Shri Sadguru Dada Maharaj Sangavadekar Seva Pratishthan, Kolhapur V. Commissioner of Income Tax (Exemption), Pune, Pune

ITA 637/PUN/2023

AI Insights

The case involves Shri Sadguru Dada Maharaj Sangavadekar Seva Pratishthan, a public trust, which appealed against the orders of the Commissioner of Income Tax (Exemption), Pune. The Commissioner had rejected the trust's applications for 12AB registration and 80G recognition, which are essential for tax exemptions under the Income Tax Act, 1961. The tribunal noted that the Commissioner had not provided a show-cause notice before rejecting the applications, which deprived the trust of a fair opportunity to present its case. The tribunal emphasized the importance of the principles of natural justice and remanded the case for a re-evaluation, instructing the Commissioner to provide adequate opportunities for the trust to comply with the requirements and substantiate its claims.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 136294 (ITAT-PUNE)
• Duration Of Justice: 2 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-07-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 26-07-2023
• Assessment Year: misc
• Appeal Filed On: 23-05-2023
• Other Referred Cases: St. Paul’s Anglo Indian Education Trust (2003) 262 ITR 377 (Pat)
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Opportunity of being heard; Audi alteram partem
• Section: 80G

Judgement Text

॥ आयकर अपीलीय न्यायाधिकरण, पुणे “बी” न्यायपीठ, पुणे में ॥ ITAT-Pune Page 1 of 5 IN THE INCOME TAX APPELLATE TRIBUNAL, PUNE “B” BENCH, PUNE BEFORE HON’BLE SHRI S. S. VISWANETHRA RAVI, JUDICIAL MEMBER AND SHRI G. D. PADMAHSHALI, ACCOUNTANT MEMBER आयकर अपीऱसं. / ITA No. 637 & 638/PUN/2023 Shri Sadguru Dada Maharaj Sangavadekar Seva Pratishthan, R.S.No. 697/B, Vishwapandhari, B Ward, Opp. I.T.Park, Kolhapur. PAN:AAITS 6440 E . . . . . . . अपीऱार्थी / Appellant बनाम / V/s. Commissioner of Income Tax Exemption, Pune. . . . . . . .प्रत्यर्थी / Respondent द्वारा / Appearances Assessee by : None Revenue by : Shri Ajay Kumar Kesari स ु नवाई की तारीख / Date of conclusive Hearing : 27/07/2023 घोषणा की तारीख / Date of Pronouncement : 01/08/2023 आदेश / ORDER PER G. D. PADMAHSHALI, AM; These two appeals of the assessee trust are directed against the separate orders of Ld. Commissioner of Income Tax (Exemption), Pune [for short ‘CIT(E)’] dt. 31/03/2023 passed u/s 12AB(4) & 80G(5) of the Income- tax Act, 1961 [for short ‘the Act’] rejecting to grant for 12AB registration and 80G recognition to the appellant trust. Shri Sadguru Dada Maharaj Sangavadekar Seva Pratishthan ITA No.637 & 638/PUN/2023 PAN: AAITS 6440 E ITAT-Pune Page 2 of 5 2. Since the facts of these two appeals are similar, related and interconnected, for the purpose of convenience and brevity, these are head together for consolidated order. In the absence of appellant, after considering order-sheet entries and recording no objection of Ld. DR, we deem fit to proceed to dispose of these matters ex-parte on merits u/r 24 of the Income Tax Appellate Tribunal Rules, 1963. 3. Pithily stated facts borne out of the case records are; the appellant is a public trust, has e-filed its application in Form No 10AB on 30/09/2022 seeking grant of registration u/s 12AB under the category of charitable trust / institution and an application in Form 10AB on 30/09/2022 for recognition u/s 80G of the Act. The Ld. CIT(E) in-order to verify the objects, activities and to ascertain the fulfilment of conditions for granting registration u/s 12AB and recognition u/s 80G of the Act, was put the appellant to a notices from time to time, which were replied by the assessee. 4. In so far as the application for 12AB is concerned, for the want of evidences in support of activities purported to be engaged by the trust, without putting the assessee to Shri Sadguru Dada Maharaj Sangavadekar Seva Pratishthan ITA No.637 & 638/PUN/2023 PAN: AAITS 6440 E ITAT-Pune Page 3 of 5 show-case notice, the Ld. CIT(E) has rejecting the said application cancelled the provisional registration granted u/s 12AB r.w.s. 12A(1)(ac)(iii) of the Act. Consequent to the aforestated denial to grant registration u/s 12AB of the Act, the application for 80G is also found rejected by the Ld. CIT(E) by an impugned order of even date. 5. Thus aggrieved by the aforestated rejections, the appellant is in appeal alleging the action of Ld. CIT(E) as violative of principle of audi alteram partem. 6. We have heard Ld. DR; and subject to the provisions of rule 18 of ITAT Rules, perused the material placed on record which suggest that, the preliminary submission of the appellant trust did failed to give plausible response to various queries raised by the registering authority and also failed to substantiate its activities with cogent evidences, as a consequence the Ld. CIT(E) without further opportunity to the appellant trust rejected the applications in violation of principle of natural justice as commanded by sub-clause (B) of section 12AB(1)(b)(ii) and by clause (ii)(b)(B) of 2 nd proviso to 80G(5) of the Act r.w. proviso to rule 11AA(5) of the Income Tax Rules, 1962. Shri Sadguru Dada Maharaj Sangavadekar Seva Pratishthan ITA No.637 & 638/PUN/2023 PAN: AAITS 6440 E ITAT-Pune Page 4 of 5 7. In our considered view, the action of the Ld. CIT(E) suffered from sufficiency of reasonable opportunity to the appellant to refute the rejection vis-à-vis to comply with the requirements sought. It shall be worthy to underlined that the opportunity of being heard should be real, reasonable and effective and same should not be empty formalities, it should not be a paper opportunity, the doctrine of natural justice is a facet of fair play in action and no person shall be saddled with a liability without being heard. In the light of decision of High court of Patna in ‘St. Paul’s Anglo Indian Education Trust (2003) 262 ITR 377 (Pat)’ we hold that, rejection of application is unjustified as the assessee deprived of reasonable opportunity and time to produce all relevant documents to substantiate its claim for registration u/s 12AB and recognition of 80G. 8. In the light of aforestated discussion, without commenting on the merits of the case, we deem it fit to remand these matters back to the file of Ld. CIT(E) for according two effective opportunities to the assessee to comply with the directions or the requirements vis-à-vis to refute the reasons of rejection as the case may be. Shri Sadguru Dada Maharaj Sangavadekar Seva Pratishthan ITA No.637 & 638/PUN/2023 PAN: AAITS 6440 E ITAT-Pune Page 5 of 5 9. In result, both these appeals are ALLOWED FOR STATISTICAL PURPOSE. In terms of rule 34 of ITAT Rules, the order pronounced in the open court on this Tuesday, 01 st day of August, 2023. -S/d- -S/d- S. S. VISWANETHRA RAVI G. D. PADMAHSHALI JUDICIAL MEMBER ACCOUNTANT MEMBER पुणे / PUNE ; दिन ांक / Dated : 01st day of August, 2023. आदेश की प्रधिधलधप अग्रेधिि / Copy of the Order forwarded to : 1.अपील र्थी / The Appellant. 2. प्रत्यर्थी / The Respondent. 3. The Pr. CIT, Pune 4. The Pr. CIT(E), Pune 5. DR, ITAT, “B” Bench, Pune 6. ग र्डफ़ इल / Guard File. आिेश नुस र / By Order, वररष्ठ दनजी सदिव / Sr. Private Secretary आयकरअपीलीय न्य य दिकरण, पुणे / ITAT, Pune.