JAISWAL YOUTH FEDERATION,MUMBAI V. CIT (EXEMPTIONS), MUMBAI, MUMBAI

ITA 2410/MUM/2025

AI Insights

The case involves the Jaiswal Youth Federation appealing against the decision of the CIT (Exemptions), Mumbai, which had rejected their application for approval under section 80G of the Income-tax Act, 1961. The rejection was primarily based on the interpretation that the assessee's MOA allowed for the application/receipt of funds outside India, which was seen as a violation of section 11 of the Act. The assessee contended that this interpretation was incorrect and that they had not been given a fair opportunity to respond to the final show cause notice. The tribunal noted that a similar issue regarding the rejection of the assessee's application for registration under section 12AB was previously addressed, and the matter was restored to the CIT (Exemptions) for a fresh decision. Following this precedent, the tribunal restored the current appeal to the CIT (Exemptions) with directions to provide a fair hearing and consider the amended MOA/objects clause.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 706155 (ITAT-MUMBAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-06-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Assessment Year: misc
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: VIVEK PERAMPURNA
• Assessee Lawyers: BHUPENDRA SHAH
• Keywords: Opportunity of being heard; Principle of natural justice
• Section: 11; 12A; 80G

Judgement Text

" |आयकर अपीलीय न्यायाधिकरण न्यायपीठ, म ुंबई| IN THE INCOME-TAX APPELLATE TRIBUNAL “F” BENCH, MUMBAI BEFORE MS. KAVITHA RAJAGOPAL, JUDICIAL MEMBER & SMT. RENU JAUHRI, ACCOUNTANT MEMBER आयकर अपील सुं./ITA No. 2410/MUM/2025 (नििाारण वर्ा / Assessment Year :2025-26) Jaiswal Youth Federation 105, Adishakti CHS, Behind S Habri Hotel, M. G. Road, Goregaon (West), Mumbai, Maharashtra- 400104 v/s. बिाम CIT (Exemptions), Mumbai 601, Comballa Hill, MTNL TE Building, Pedder Road, Dr. Gopalrao Deshmukh Marg, Cumballa Hill, Mumbai, Maharashtra- 400026 स्थायी लेखा सं./जीआइआर सं./PAN/GIR No: AAECJ8414G Appellant/अपीलार्थी .. Respondent/प्रनिवादी निर्ााररती की ओर से /Assessee by: Shri Bhupendra Shah राजस्व की ओर से /Revenue by: Shri Vivek Perampurna स िवाई की िारीख / Date of Hearing 30.06.2025 घोर्णा की िारीख/Date of Pronouncement 30.06.2025 आदेश / O R D E R PER RENU JAUHRI [A.M.] :- This appeal is filed by the assessee against the order of the Learned Commissioner of Income-tax (Exemptions), Mumbai [hereinafter referred to as “CIT(E)”] dated 25.12.2024, rejecting the approval u/s 80G of the Income-tax Act, 1961 [hereinafter referred to as “Act”]. P a g e | 2 ITA No. 2410/Mum/2025 A.Y. 2025-26 Jaiswal Youth Federation 2. The assessee has raised the following grounds of appeal: 1. Based on the facts and circumstances of the case, and in accordance with the law, the learned CIT (Exemptions), Mumbai wrongly interpreted the ancillary object clause that appellant intends to receive/spend funds outside India hence the same is in violation of the provisions of section 11, and rejected the application, which is not justified. 2. Based on the facts and circumstances of the case, and in accordance with the law, the learned CIT (Exemptions), Mumbai was not justified in giving only 5 days' time in final SCN dt. 12/12/2024, thereby denying the appellant sufficient opportunity of being heard, hence, violated the principal of natural justice. 3. Based on the facts and circumstances of the case, and in accordance with the law, the learned CIT (Exemptions), Mumbai erred in not giving sufficient opportunity as the appellant was unaware of the final SCN issued on 12/12/2024 and rejected the application in a hurried manner. 4. Based on the facts and circumstances of the case, and in accordance with the law, the learned CIT (Exemptions), Mumbai failed to consider the documents already filed, which proved the charitable activities carried on and rejected the application on technical grounds of non-submission of details/documents asked for. 5. Based on the facts and circumstances of the case, and in accordance with the law, the appellant contends that the rejection of the 12A application by the CIT (Exemptions), Mumbai was procedurally flawed, as it was carried out hastily, with misinterpretation of the object clause and without providing sufficient opportunity for representation. Consequently, the rejection of the 80G application, based on the absence of 12A registration, is unjustified. The appellant seeks a fair review of both applications, ensuring adherence to the principles of natural justice and procedural propriety. 6. Based on the facts and circumstances of the case, and in accordance with the law, the learned CIT (Exemptions), Mumbai was not justified in denying the registration ignoring the fact that the appellant is a section 8 company and involved in charitable activities, as proved from the documents already filed. 3. Brief facts of the case are that the assessee filed an application in Form 10AB on 12.06.2024 requesting for approval u/s 80G of the Act. The assessee filed information in response to the notice issued by Ld. CIT(E) on 05.11.2024, wherefrom the Ld. CIT(E) noted that the MOA provides for application/receipt P a g e | 3 ITA No. 2410/Mum/2025 A.Y. 2025-26 Jaiswal Youth Federation of funds outside India under the objects clause 3(b)(2). He therefore held that the objects of the assessee are in violation of the provisions of Section 11 of the Act, and accordingly, the application was rejected vide order dated 25.12.2024. Aggrieved with the order of Ld. CIT(E), the assessee has preferred an appeal before the Tribunal. 4. Before us, Ld. AR has submitted that the assessee company is a Section 8 registered company, which is involved in genuine charitable activities. He has also submitted that for the same reasons, the assessee’s application for registration u/s 12AB was also rejected, against which the assessee’s appeal was heard by the coordinate bench. He has further submitted that the proposed modification of the object clauses is underway. 5. We have heard the rival submissions and perused the material placed before us. It is seen that the assessee’s application for registration u/s 12AB of the Act was also rejected for identical reasons. The assessee’s appeal against the rejection order u/s 12AB has been decided vide the coordinate bench’s order dated 25.05.2025, whereby the matter has been restored to the Ld. CIT(E) for a fresh decision after giving sufficient opportunity to the assessee and liberty to it to file the amended MOA/objects clause. Accordingly, the present appeal is also restored to the Ld. CIT(E) for a fresh decision after giving due opportunity to the assessee. The assessee is at liberty to file the amended MOA/objects clause P a g e | 4 ITA No. 2410/Mum/2025 A.Y. 2025-26 Jaiswal Youth Federation before the Ld. CIT(E), which should be taken into account while deciding the application. 6. In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open court on 30.06.2025. Sd/- Sd/- KAVITHA RAJAGOPAL RENU JAUHRI (न्यानयक सदस्य/JUDICIAL MEMBER) (लेखाकार सदस्य/ACCOUNTANT MEMBER) Place: म ुंबई/Mumbai दिन ुंक /Date 30.06.2025 अननक ेत स ुंह र जपूत/ स्टेनो आदेश की प्रनतनलनि अग्रेनित/Copy of the Order forwarded to : 1. अपीलार्थी / The Appellant 2. प्रत्यर्थी / The Respondent. 3. आयकर आयुक्त / CIT 4. विभागीय प्रविविवि, आयकर अपीलीय अविकरण DR, ITAT, Mumbai 5. गार्ड फाईल / Guard file. सत्यानित प्रनत //True Copy// आदेशािुसार/ BY ORDER, सहायक िंजीकार (Asstt. Registrar) आयकर अिीलीय अनर्करण/ ITAT, Bench, Mumbai. "