JAI BHAVANIGAD VIKAS PRATISHTHAN,PUNE V. CIT EXEMPTION, PUNE

ITA 2865/PUN/2024

AI Insights

The case involves Jai Bhavanigad Vikas Pratishthan, a trust, appealing against the decision of the CIT (Exemption), Pune, which rejected their application for registration under section 12A of the Income Tax Act, 1961, and cancelled their provisional registration under section 12AB. The CIT (Exemption) had initially rejected the application due to non-compliance with notices requesting detailed information to verify the genuineness of the trust's activities and compliance with legal requirements. The tribunal, considering the circumstances and the potential for the assessee to provide the necessary details, decided to remand the case back to the CIT (Exemption) for a final opportunity to comply.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 398341 (ITAT-PUNE)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-06-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SANDEEP SENGUPTA
• Assessee Lawyers: KISHOR PHADKE VIRTUAL
• Keywords: Opportunity of being heard
• Section: 12A

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH “A”, PUNE BEFORE SHRI R. K. PANDA, VICE PRESIDENT AND SHRI VINAY BHAMORE, JUDICIAL MEMBER ITA No.2865/PUN/2024 Jai Bhavanigad Vikas Pratishthan GAT No.41, LAKHEWADI, Bawada S.O., Pune – 413103 Vs. CIT, Exemption, Pune PAN: AACTJ6965D (Appellant) (Respondent) Assessee by : Shri Kishor Phadke (virtual) Department by : Shri Sandeep Sengupta, CIT Date of hearing : 03-06-2025 Date of pronouncement : 04-06-2025 O R D E R PER R. K. PANDA, VP : This appeal filed by the assessee is directed against the order dated 22.10.2024 of the Ld. CIT(Exemption), Pune rejecting the application for grant of registration u/s 12A of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) and cancelling the provisional registration granted earlier u/s 12AB of the Act. 2. Facts of the case, in brief, are that the assessee filed an application in Form No.10AB on 29.06.2024 for registration of the trust under clause (iii) of section 12A(1)(ac) of the Act. With a view to verify the genuineness of the activities of the assessee and compliance to requirements of any other law for the time being in 2 ITA No.2865/PUN/2024 force by the trust / institution as are material for the purpose of achieving its objects, a notice was issued through ITBA portal on 05.08.2024 requesting the assessee to upload certain information / clarification. The assessee was also requested to submit the compliance by 20.08.2024. Since the assessee did not comply to the said notice, another opportunity was granted by the Ld. CIT(E) vide notice dated 04.10.2024 asking the assessee to explain as to why the application for registration u/s 12A should not be rejected and why the provisional registration granted earlier u/s 12AB should not be cancelled. Despite this notice there was no compliance from the side of the assessee for which the Ld. CIT(E) granted one more opportunity to the assessee. However, due to persistent non-compliance to the statutory notices, the Ld. CIT(E) rejected the application for grant of registration u/s 12A of the Act and also cancelled the provisional registration granted earlier u/s 12AB by observing as under: “5. The information / details were called for under the provisions of section 12AB(1)(b)(i) of the Income Tax Act, 1961. These are the basic details required to ascertain the overall nature of the activities of the assessee and are directly relevant to the present proceedings. However, the assessee has failed to comply despite giving sufficient opportunities as discussed above including an opportunity of being heard. 6. Thus, the assessee has failed to furnish the details called for under the provisions of section 12AB(1)(b)(i) of the Income Tax Act, 1961 to verify the genuineness of activities of the trust / institution and to verify the compliance to requirements of any other law for the time being in force by the trust/institution as are material for the purpose of achieving its objects. 7. In absence of the compliance to the above requirement, it is not possible to arrive at any conclusion about the genuineness of activities of the assessee and the compliance to the requirements of any other law for the time being in force by the trust / institution as are material for the purpose of achieving its objects. 3 ITA No.2865/PUN/2024 8. It is clear from the above that the assessee was given sufficient opportunity to comply, but it has not complied to the same. It seems that the assessee is not having any supporting documents / evidence to submit. The assessee has failed to comply with the provisions of section 12AB(1)(b)(i) of the Income Tax Act, 1961. Hence, the undersigned is unable to draw any satisfactory conclusion about genuineness of activities of the assessee and the compliance to the requirements of any other law for the time being in force by the trust / institution as are material for the purpose of achieving its objects. Therefore, the undersigned has left no alternative but to reject the application. 9. In view of the above, the application filed by the assessee is hereby rejected and the provisional registration granted on 27/05/2021 under section 12AB read with section 12A(1)(ac) (vi) of the Income Tax Act, 1961 is hereby cancelled.” 3. Aggrieved with such order of Ld. CIT(E), the assessee is in appeal before the Tribunal by raising the following grounds: 1. The learned CIT (Exemption), Pune, erred in law and on facts in rejecting the appellant's application for registration u/s 12A of ITA, 1961. 2. The learned CIT (Exemption), Pune erred in law and on facts in not providing reasonable opportunity of being heard to the appellant, as provided u/s 12AB of the ITA, 1961; to submit the details / information. The learned CIT (Exemption), Pune ought to have considered submission filed over email on 04/10/2024. As such, the rejection order passed by the learned CIT (Exemption), Pune, needs to be set-aside. 3. The learned CIT (Exemption), Pune, ought to have appreciated that appellant's activities are genuine and bonafide, and as such, eligible for registration u/s 12A of ITA, 1961. 4. Appellant craves leave to add, alter, clarify, explain, modify, delete any or all of the grounds of appeal, and to seek any just and fair relief. 4. The Ld. Counsel for the assessee submitted that due to preoccupation of the concerned Chartered Accountant, the details could not be filed. He submitted that given an opportunity the assessee is in a position to substantiate its case by filing 4 ITA No.2865/PUN/2024 all the relevant details for deciding the issue afresh. He accordingly submitted that the matter may be restored to the file of the Ld. CIT(E). 5. The Ld. DR on the other hand strongly objected to the arguments advanced by the Ld. Counsel for the assessee. He submitted that the Ld. CIT(E) has passed a detailed order rejecting the application for grant of registration and also cancelling the provisional registration granted earlier due to the non-compliance. Therefore, the same should be upheld and the appeal filed by the assessee be dismissed. 6. We have heard the rival arguments made by both the sides, perused the order of the Ld. CIT(E) and the paper book filed on behalf of the assessee. It is an admitted fact that due to non-compliance to the notice issued by the Ld. CIT(E) asking for certain details, he rejected the application for grant of registration and also cancelled the provisional registration granted earlier. It is the submission of the Ld. Counsel for the assessee that given an opportunity the assessee is in a position to substantiate its case by filing all the relevant details before the Ld. CIT(E). Considering the totality of the facts of the case and in the interest of justice, we deem it proper to restore the issue to the file of the CIT(E) with a direction to grant one final opportunity to the assessee to substantiate its case by filing the requisite details to his satisfaction and decide the issue as per fact and law. The assessee is also hereby directed to submit the details as called for by the CIT(E) on the appointed date without seeking any adjournment under any pretext, 5 ITA No.2865/PUN/2024 failing which the CIT(E) is at liberty to pass appropriate order as per law. We hold and direct accordingly. The grounds raised by the assessee are accordingly allowed for statistical purposes. 7. In the result, the appeal filed by the assessee is allowed for statistical purposes. Order pronounced in the open Court on 4th June, 2025. Sd/- Sd/- (VINAY BHAMORE) (R. K. PANDA) JUDICIAL MEMBER VICE PRESIDENT पुणे Pune; दिन ांक Dated : 4th June, 2025 GCVSR आदेश की प्रतितिति अग्रेतिि/Copy of the Order is forwarded to: 1. अपीलार्थी / The Appellant; 2. प्रत्यर्थी / The Respondent 3. 4. The concerned Pr.CIT, Pune DR, ITAT, ‘A’ Bench, Pune 5. गार्ड फाईल / Guard file. आदेशानुसार/ BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलीय अधिकरण ,पुणे / ITAT, Pune 6 ITA No.2865/PUN/2024 S.No. Details Date Initials Designation 1 Draft dictated on 03.06.2025 Sr. PS/PS 2 Draft placed before author 04.06.2025 Sr. PS/PS 3 Draft proposed & placed before the Second Member JM/AM 4 Draft discussed/approved by Second Member AM/AM 5 Approved Draft comes to the Sr. PS/PS Sr. PS/PS 6 Kept for pronouncement on Sr. PS/PS 7 Date of uploading of Order Sr. PS/PS 8 File sent to Bench Clerk Sr. PS/PS 9 Date on which the file goes to the Head Clerk 10 Date on which file goes to the A.R. 11 Date of Dispatch of order "