Fly High Charitable Society, Pune V. Commissioner of Income-Tax -Exemption, Pune

ITA 946/PUN/2022

AI Insights

The case involves Fly High Charitable Society, which appealed against the decision of the CIT (Exemption), Pune, rejecting their application for registration under section 12AB of the Income Tax Act. The CIT (Exemption) had rejected the application on the grounds that the activities undertaken by the society, such as fashion shows, were not charitable in nature. The Tribunal found that the CIT (Exemption) had not adequately addressed the charitable activities documented by the society, such as donating sanitary vending machines and conducting clothing drives for underprivileged groups. The Tribunal criticized the CIT (Exemption) for not conducting a proper enquiry or providing a detailed reasoning for the rejection and remanded the case for further investigation and a reasoned decision.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 132874 (ITAT-PUNE)
• Duration Of Justice: 2 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-02-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 21-02-2023
• Assessment Year: misc
• Appeal Filed On: 25-12-2022
• Laws Referred To: Section 12AB of the Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Principle of natural justice

Judgement Text

आयकर अपीलीय अधिकरण “ए” न्यायपीठ पुणे में । IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, PUNE BEFORE SHRI R.S. SYAL, VICE PRESIDENT AND SHRI PARTHA SARATHI CHAUDHURY, JUDICIAL MEMBER आयकर अपील सं. / ITA No.946/PUN/2022 Fly High Charitable Society, Flat No. 401, 4 th Floor, Vasant Vaibhav, A-2 Wing, S. No. 14IB 1A, Hingne, Pune – 411052 PAN : AAATF7242D ......अपीलार्थी / Appellant बनाम / V/s. The CIT (Exemption), Pune ......प्रत्यर्थी / Respondent Assessee by : Shri C.H. Naniwadekar & Kiran Sanmane Revenue by : Shri Keyur Patel सुनवाई की तारीख / Date of Hearing : 22-02-2023 घोषणा की तारीख / Date of Pronouncement : 27-02-2023 आदेश / ORDER PER PARTHA SARATHI CHAUDHURY, JM : This appeal preferred by the assessee emanates from the order of the Ld. CIT(Exemption), Pune dated 27.10.2022 as per following grounds of appeal : “1. The learned CIT(Exemption) erred on facts and in law in rejecting approval u/s 12AB of the Act. He failed to appreciate the facts and contentions of the assessee in proper perspective. 2. The appellant craves leave to add, alter, delete or substitute all or any of the above grounds of appeal.” 2 ITA No.946/PUN/2022 2. In this appeal, the assessee is aggrieved with the decision of Department for not granting registration u/s. 12AB of the Act. That as per provisions of section 12AB of the Act the Commissioner shall satisfy himself regarding the genuineness of the activities of applicant- trust/society and also that such applicant complies that all the applicable laws prevailing at the relevant point of time. As per Para 2 of the order of CIT(Exemption) various details were called for from the assessee and from bare reading of Para 3, it is understood that all the required documents/details have been furnished by the assessee before the Department. The Ld. CIT(Exemption) has rejected the application for registration only by observing that the assessee has undertaken activities which includes fashion shows etc. and therefore, these are not charitable in nature within the spirit and ambit of section 12AB of the Act. 3. At the time of hearing, the Ld. Counsel for the assessee demonstrated that they have submitted the entire memorandum of the assessee’s trust before the Department, wherein, all the detailed objects have been specifically provided for. That further, the assessee has also submitted before the Ld. CIT(Exemption) that they have donated sanitary vending machine for girls especially from rural areas, winter clothes drive for orphans and old age home people, medical/clothes donation drive for flood relief people in the area of Sangli. The assessee’s trust has also submitted various photographs, wherein, it can be seen that the applicant’s trust is distributing these sanitary vending machines to some schools etc. We are of the considered view that all these facts were in front of the Ld. CIT(Exemption). Once, he is rejecting the application for registration u/s. 12AB of the Act, he should specify the reasons as to why the activities of the trust are not genuine in nature and that they are also 3 ITA No.946/PUN/2022 not charitable in nature. The Ld. CIT(Exemption) has not discussed in his order that in spite of the charitable objects enumerated in the memorandum of the assessee’s trust and the various activities performed for the benefit of the society what independent enquiry and verification he has conducted before rejecting the application. In this case in spite of the submissions given by the assessee, the order of Ld. CIT(Exemption) is absolutely silent about any enquiry conducted and verification, if any, he has done in relation to these submissions of the assessee before rejecting the application of the assessee’s trust. As a Quasi Judicial Authority the principles of natural justice demands such an exercise from him. Therefore, the order of Ld. CIT(Exemption) being a non-speaking order cryptic and summarily done suffers from the lacuna for non-conducting of enquiry and verification and therefore, in the interest of justice, we set aside the said order and remand the matter back to his file to undertake detailed enquiry regarding the genuineness of the objects of the applicant’s trust/society and come out with a speaking order as per law complying with principles of natural justice. 4. In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open court on 27 th February, 2023. Sd/- Sd/- (R.S. Syal) (Partha Sarathi Chaudhury) VICE PRESIDENT JUDICIAL MEMBER पुणे / Pune; दिनाांक / Dated : 27 th February, 2023. रदव 4 ITA No.946/PUN/2022 आदेश की प्रधिधलधप अग्रेधिि / Copy of the Order forwarded to : 1. अपीलार्थी / The Appellant. 2. प्रत्यर्थी / The Respondent. 3. The CIT(Exemption), Pune. 4. दवभागीय प्रदतदनदि, आयकर अपीलीय अदिकरण, “ए” बेंच, पुणे / DR, ITAT, “A” Bench, Pune. 5. गार्ड फ़ाइल / Guard File. //सत्यादपत प्रदत// True Copy// आिेशानुसार / BY ORDER, वररष्ठ दनजी सदचव / Sr. Private Secretary आयकर अपीलीय अदिकरण ,पुणे / ITAT, Pune