MILLENNIAL FOUNDATION,AHMEDABAD V. CIT (EXEMPTION), AHMEDABAD

ITA 1988/AHD/2024

AI Insights

The Millennial Foundation appealed against the orders of the Commissioner of Income Tax (Exemption), Ahmedabad, which had rejected their applications for registration under sections 12A and 80G of the Income Tax Act for the assessment year 2024-25. The primary contention was the denial of adequate opportunity to be heard before the rejection of their applications. The tribunal noted the procedural lapses and the need for a fair hearing, emphasizing the principles of natural justice. Both appeals were consolidated due to the common facts and issues involved.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 41023 (ITAT-AHMEDABAD)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-02-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2024-2025
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PRATHVI RAJ MEENA
• Assessee Lawyers: RIMA MEHTA
• Keywords: Set aside; Opportunity of being heard; Sale consideration of property below Jantri Value; Principle of natural justice
• Section: 12A; 80G

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL “D” BENCH, AHMEDABAD BEFORE SHRI SIDDHARTHA NAUTIYAL, JUDICIAL MEMBER & SHRI MAKARAND VASANT MAHADEOKAR, ACCOUNTANT MEMBER I.T.A. Nos.1987&1988/Ahd/2024 (Assessment Year: 2024-25 & 2024-25) Millennial Foundation, B-52, Goyal Park, B/h. Premchand Nagar, Vastrapur, Gujarat-380015 Vs. Commissioner of Income Tax (Exemption), Ahmedabad [PAN No.AAITM1250C] (Appellant) .. (Respondent) Appellant by : Ms. Rima Mehta, A.R. Respondent by: Shri Prathvi Raj Meena, CIT-DR Date of Hearing 13.02.2025 Date of Pronouncement 19.02.2025 O R D E R PER SIDDHARTHA NAUTIYAL - JUDICIAL MEMBER: These are appeals have been filed by the Assessee against the order passed by the Ld. Commissioner of Income Tax (Exemption), (in short “Ld. CIT(E)”), Ahmedabad vide orders dated 26.09.2024 passed for A.Y. 2024-25. Since common facts and issues are involved for both the years under consideration, both the cases are taken up together. 2. These are appeals filed by the assessee against non-grant of registration under section 12A and 80G of the Act to the applicant trust. Since both the issues/matters before us pertain to the same year under consideration, both the appeals filed by the assessee are being taken up together. ITA Nos. 1987&1988/Ahd/2024 Millennial Foundation vs. CIT(E) Asst. Year –2024-25 - 2– 3. We shall first take up the assessee’s appeal with respect to rejection of grant of registration under section 12A of the Act. The assessee has taken the following grounds of appeal: “1. Ld CIT (Exemption) erred in law and on facts in rejecting the application of the Appellant seeking registration under section 12A of the Act. The Learned Commissioner of Income Tax (Exemption), erred in passing the order rejecting the application cancelling provisional registration by not granting proper, sufficient and adequate opportunity of being heard to the Appellant while passing the order 2. Ld CIT(E) failed to appreciate that as per the principles of natural justice, providing adequate opportunity of being heard to the appellant is necessary before passing the adverse order. 3. In the light of the circumstances, it is humbly prayed to set aside the order passed by Ld. CIT (Exemption). 4. The Appellant craves leave to add, alter, amend and/or withdraw any ground or grounds of appeal either before or during the course of hearing of the appeal.” 4. The brief facts of the case are that the assessee filed application for approval under section 12A in form 10AB. The CIT (Exemptions) asked the applicant trust to submit certain details/documents vide notice dated 04-07-2024. In response to the said notice, the assessee vide reply dated 21-07-2020 sought an adjournment for 15 days. However, the assessee did not file any additional details as called for by the CIT (Exemptions). Accordingly, vide order dated 26-09-24, CIT dismissed the application of the assessee/applicant trust on the ground that the applicant/assessee has failed to file documentary evidences to satisfy about the genuineness of the activities of the trust, that the activities of the trust are in consonance with the objects of the trust and whether the laws for the purpose of achieving the objects of the trust have been complied with. ITA Nos. 1987&1988/Ahd/2024 Millennial Foundation vs. CIT(E) Asst. Year –2024-25 - 3– 5. The assessee is in appeal before us against the aforesaid order passed by CIT dismissing the application for grant of registration under section 12A of the Act. Before us, the counsel for the assessee submitted that admittedly, there was an error on the part of the assessee/applicant trust in not making adequate compliance before the CIT (Exemptions). However, it was submitted before us that the assessee/applicant trust along with Form 10AB, had filed the audited accounts of the assessee trust and had also sought further time to file the necessary documents to prove the genuineness of the trust. However, it was submitted that within a very short span of time, (albeit though there was non-compliance on behalf of the assessee/applicant trust as well), the application of the assessee/applicant trust was rejected by the CIT (Exemptions), without conducting further enquiry/without granting any opportunity to the assessee/applicant trust. However, the counsel for the assessee/applicant trust assured us that if given an opportunity, the assessee shall promptly and diligently comply with all notices issued by CIT (Exemptions) and file all necessary details/supporting documents to prove the genuineness of the Trust, in a timely manner. 6. In response, DR placed reliance on the observations made by CIT (Exemptions) in the order denying grant of registration and also submitted that admittedly, as per the authorised representatives of the assessee/applicant trust, there has been non-compliance on part of the assessee/applicant trust before CIT (Exemptions). However, in interest of ITA Nos. 1987&1988/Ahd/2024 Millennial Foundation vs. CIT(E) Asst. Year –2024-25 - 4– justice the Ld. DR has not objected to the matter being restored to the file of CIT (Exemptions) for de novo hearing. 7. We have heard the rival contentions and perused the material on record. On going through the instant facts as stated above, in interest of justice, the matter is restored to the file of CIT (Exemptions), with a view to allow a fresh opportunity of hearing to the assessee/applicant trust. The assessee/applicant trust is directed to promptly comply with all notices of hearing and furnish all supporting documents/evidences to prove the genuineness of the activities of the trust, that the activities of the trust or institutional are in consonance with the objects for which it has been incorporated and that all material laws have been complied with by the assessee/applicant trust. In the event, if it is found that there is further non- compliance by the assessee/applicant trust before CIT (Exemptions), he would be at liberty to pass appropriate orders, on the basis of details furnished/material available on record before him, in accordance with law. 8. In the result, the appeal of the assessee/applicant trust is allowed for statistical purposes. 9. We observe that the background and facts for consideration are similar in the appeal filed by the assessee/applicant trust, against the order Passed by CIT (Exemptions), dismissing the application filed by the assessee/applicant trust for grant of registration under section 80G of the Act. Accordingly, the matter is restored to the file of CIT (Exemptions), for de novo consideration on this issue as well. ITA Nos. 1987&1988/Ahd/2024 Millennial Foundation vs. CIT(E) Asst. Year –2024-25 - 5– 10. In the result, both the appeals filed by the assessee have been restored to the file of CIT (Exemptions) and the appeals of the assessee are allowed for statistical purposes. This Order is pronounced in the Open Court on 19/02/2025 Sd/- Sd/- (MAKARAND V. MAHADEOKAR) (SIDDHARTHA NAUTIYAL) ACCOUNTANT MEMBER JUDICIAL MEMBER Ahmedabad; Dated 19/02/2025 TANMAY, Sr. PS TRUE COPY आदेश की Ůितिलिप अŤेिषत/Copy of the Order forwarded to : 1. अपीलाथŎ / The Appellant 2. ŮȑथŎ / The Respondent. 3. संबंिधत आयकर आयुƅ / Concerned CIT 4. आयकर आयुƅ(अपील) / The CIT(A)- 5. िवभागीय Ůितिनिध, आयकर अपीलीय अिधकरण, अहमदाबाद / DR, ITAT, Ahmedabad 6. गाडŊ फाईल / Guard file. आदेशानुसार/ BY ORDER, उप/सहायक पंजीकार (Dy./Asstt.Registrar) आयकर अपीलीय अिधकरण, अहमदाबाद / ITAT, Ahmedabad 1. Date of dictation 17.02.2025(Dictated by Hon’ble Member over his dragon software) 2. Date on which the typed draft is placed before the Dictating Member 17.02.2025 3. Other Member………………… 4. Date on which the approved draft comes to the Sr.P.S./P.S 18.02.2025 5. Date on which the fair order is placed before the Dictating Member for pronouncement 20.02.2025 6. Date on which the fair order comes back to the Sr.P.S./P.S 20.02.2025 7. Date on which the file goes to the Bench Clerk 20.02.2025 8. Date on which the file goes to the Head Clerk…………………………………... 9. The date on which the file goes to the Assistant Registrar for signature on the order…………………….. 10. Date of Dispatch of the Order…………………………………… "