MINHAJUS SHARQIA EDUCATIONAL SOCIETY,HYDERABAD V. CIT (EXEMPTION), HYDERABAD

ITA 839/HYD/2025

AI Insights

The Minhajus Sharquia Educational Society, a long-established educational institution in Hyderabad, sought permanent registration under Sections 12AB and 80G(5) of the Income-tax Act, 1961. The Commissioner of Income-Tax (Exemption), Hyderabad, initially issued notices requesting additional details, which the society partially fulfilled. However, the CIT(Exemption) later rejected their applications, citing insufficient information without specifying the deficiencies. The Tribunal found the CIT(Exemption)'s orders to be non-speaking and in violation of the principles of natural justice, leading to the setting aside of the orders and remanding the matter for a fresh decision.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 716509 (ITAT-HYDERABAD)
• Duration Of Justice: 3 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-08-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB-B
• Assessment Year: misc
• Appeal Filed On: 16-05-2025
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Set aside; Opportunity of being heard; Principle of natural justice
• Section: 12A; 80G

Judgement Text

"आयकर अपीलीय न्यायाधिकरण में, हैदराबाद ‘बी’ बेंच, हैदराबाद IN THE INCOME TAX APPELLATE TRIBUNAL Hyderabad “B” Bench, Hyderabad श्री रवीश सूद, माननीय न्याययक सदस्य एवं श्री मिुसूदन सावडिया, माननीय लेखा सदस्य SHRI RAVISH SOOD, HON’BLE JUDICIAL MEMBER AND SHRI MADHUSUDAN SAWDIA, HON’BLE ACCOUNTANT MEMBER आयकरअपीलसं./I.T.A.Nos.838 and 839/Hyd/2025 (निर्धारण वर्ा/ Assessment Year: 2025-26) Minhajus Sharquia Educational Society, Hyderabad. PAN : AADAM3988R Vs. The Income Tax Officer, Ward 9(1), Hyderabad. (अपीलार्थी/ Appellant) (प्रत्यर्थी/ Respondent) करदाता का प्रतततितित्व/ Assessee Represented by : Shri B. Satayanarayana Murthy, C.A. राजस्व का प्रतततितित्व/ Department Represented by : Dr. Narendra Kumar Naik, CIT(DR) सुिवाई समाप्त होिे की ततति/ Date of Conclusion of Hearing : 05.08.2025 घोर्णध की तधरीख/ Date of Pronouncement : 20.08.2025 O R D E R प्रनत रवीश सूद, जे.एम./PER RAVISH SOOD, J.M. The captioned appeals filed by the assessee society are directed against two separate orders passed by the Commissioner of Income-Tax (Exemption), [for short “CIT (Exemptions)”], Hyderabad, dated 21.03.2025 and 20.03.2025, wherein the latter had declined the Printed from counselvise.com 2 ITA Nos.838 and 839/Hyd/2025 Minhajus Sharquia Educational Society applications filed by the assessee society for permanent registration/approval u/s. 12AB and u/s 80G(5) of the Income-tax Act, 1961 (in short ‘the Act’), respectively. Since these appeals pertain to the same assessee society, therefore, these are being taken up and disposed off by way of a consolidated order. 2. We shall first take up the appeal filed by the assessee society in ITA No.838/Hyd/2025, wherein it has assailed the impugned order on the following grounds of appeal: “1.The Order of the learned Commissioner of Income Tax (Exemptions) is contrary to the facts of the case and the Provisions of Law. 2. The learned Commissioner of Income Tax (Exemptions) is not justified in rejecting the Application for Registration U/s. 12AB of the Income Tax Act on the ground that there is no response to the notices sent by him. 3. The learned Commissioner of Income Tax (Exemptions) should have appreciated that the Appellant Society has been running a school from the year 1962 and has been enjoying the Registration under the Income Tax Act for several years. 4. The learned Commissioner of Income Tax (Exemptions) should have given another opportunity to the Appellant Trust for submitting the necessary details required by him Instead of refusing the Registration for want of reply to this Notice even because most of the details were filed by the Appellant Society.” 3. Succinctly stated, the assessee society is registered with the Registrar of Societies, Andhra Pradesh vide Certificate of Registration No. 74 of 1962, dated 03.07.1962. The assessee society, has as its objectives rendering dedicated services of providing education to girls, and in furtherance of the same is running certain educational Printed from counselvise.com 3 ITA Nos.838 and 839/Hyd/2025 Minhajus Sharquia Educational Society institutions, viz. (i). Princess Durru Shehvar Girls High school; (ii). Model High School; (iii). Princess Durru Shehvar Jr. College for Girls; and (iv). Princess Durru Shehvar College of Education for Women. 4. The assessee society was granted provisional registration under Section 12A of the Act. Subsequently, the assessee society applied for permanent registration in Form No. 10AB. 5. The CIT(Exemption), Hyderabad issued notice dated 03.12.2024 seeking certain details, viz. Memorandum of Association/Trust deed for verification and a detailed reply on certain issues. However, the assessee society failed to comply with the aforesaid notice. Thereafter, the CIT(Exemption) issued another notice dated 07.02.2025, wherein the assessee society was provided another opportunity to furnish the requisite details. In compliance, the assessee society duly responded vide its reply dated 22.02.2025 that was uploaded/filed on the same date. 6. However, the CIT(Exemption), Hyderabad, vide his impugned order dated 21.03.2025 in “Form 10AD”, rejected the application for registration filed by the assessee society under Section 12AB of the Act. The CIT(Exemption), though observed in his order that the assessee Printed from counselvise.com 4 ITA Nos.838 and 839/Hyd/2025 Minhajus Sharquia Educational Society society had furnished only partial information based on which the genuineness of its activities could not be verified, but he failed to specify what particular information was not provided. 7. We have thoughtfully considered the order passed by the CIT(Exemption), and are of the considered view that the impugned order is a non-speaking order. The CIT(Exemption) has not articulated as to which information was missing, despite the assessee society furnishing a detailed reply along with supporting documents., Page 13-16 of APB. We are of a firm conviction that the rejection by the CIT(Exemption) of the application filed by the assessee society for permanent registration without passing a reasoned order violates the principles of natural justice. It will be apposite to observe, that non-speaking, cryptic, and mechanical orders passed by quasi-judicial authorities are not sustainable in law. The CIT(Exemption), while disposing off the application filed by the assessee society for permanent registration under Section 12AB of the Act was expected to provide a reasoned order and specific findings after considering the material on record. 8. In view of the above, the impugned order dated 21.03.2025 is hereby set aside, and the matter is restored to the file of the CIT(Exemption), Hyderabad with a direction to pass a fresh speaking Printed from counselvise.com 5 ITA Nos.838 and 839/Hyd/2025 Minhajus Sharquia Educational Society and reasoned order in accordance with law. Needless to say, the assessee society in the course of the set aside proceedings shall be afforded a reasonable opportunity of being heard and remain at liberty to submit any further documents or explanations as may be required. 9. In the result, the appeal filed by the assessee society in ITA No.838/Hyd/2025 is allowed for statistical purposes in terms of our aforesaid observations. ITA No.839/Hyd/2025 10. We shall now deal with the appeal filed by the assessee society, wherein it has assailed the rejection of its application for permanent registration under Section 80G(5) of the Act by the CIT(Exemption), Hyderabad. The assessee society has assailed the impugned order on the following grounds of appeal before us: “1.The Order of the learned Commissioner of Income Tax (Exemptions) is contrary to the facts of the case and the Provisions of Law. 2. The learned Commissioner of Income Tax (Exemptions) is not justified in rejecting the Application for Registration U/s.80G of the Income Tax Act on the ground that there is no response to the notices sent by him. 3. The learned Commissioner of Income Tax (Exemptions) should have appreciated that the Appellant Society has been running a school from the year 1962 and has been enjoying the Registration under the Income Tax Act for several years. 4. The learned Commissioner of Income Tax (Exemptions) should have given another opportunity to the Appellant Trust for submitting the necessary details required by him Instead of refusing the Registration for want of reply to this Notice even because most of the details were filed by the Appellant Society.” Printed from counselvise.com 6 ITA Nos.838 and 839/Hyd/2025 Minhajus Sharquia Educational Society 11. Succinctly stated, the assessee society was granted provisional registration under Section 80G of the Act. Subsequently, the assessee society applied for permanent registration in “Form No. 10AB”, which, however, was rejected by the CIT(Exemption), Hyderabad, vide his order passed in “Form 10AD”, dated 20.03.205. 12. The CIT(Exemption), Hyderabad issued notices dated 03.12.2024 and 14.02.2025 seeking certain details, viz. Memorandum of Association/Trust deed for verification and detailed reply on certain issues. In compliance, the assessee society filed the requisite details vide its reply dated Nil that was uploaded/filed on 27.02.2025. 13. However, the CIT(Exemption), Hyderabad, vide his impugned order dated 20.03.2025 in “Form 10AD”, rejected the application for registration filed by the assessee society under Section 80G of the Act. The CIT(Exemption), though observed in his order that the assessee society had furnished only partial information based on which the genuineness of its activities could not be verified, but he failed to specify what particular information was not provided. Printed from counselvise.com 7 ITA Nos.838 and 839/Hyd/2025 Minhajus Sharquia Educational Society 14. As the facts attending to the rejection of the application filed by the assessee society for permanent registration under Section 80G(5) remain the same as were involved in its appeal against the order of the CIT(Exemption) declining its registration u/s 12AB of the Act in ITA No. 838/Hyd/2025, therefore, our order therein passed shall apply mutatis mutandis for the purpose of disposing the present appeal. 15. In the result, the impugned order dated 20.03.2025 is on the same terms hereby set aside, and the matter is restored to the file of the CIT(Exemption), Hyderabad with a direction to pass a fresh speaking and reasoned order in accordance with law. Needless to say, the assessee society in the course of the set aside proceedings shall be afforded a reasonable opportunity of being heard and will remain at liberty to submit any further documents or explanations as may be required. 16. In the result, the appeal filed by the assessee society in ITA No. 839/Hyd/2025 is allowed for statistical purposes in terms of our aforesaid observations. Printed from counselvise.com 8 ITA Nos.838 and 839/Hyd/2025 Minhajus Sharquia Educational Society 17. Resultantly, both the appeals filed by the assessee society are allowed for statistical purposes in terms of our aforesaid observations. Order pronounced in the Open Court on 20th August, 2025. Sd/- (श्री मिुसूदन सावडिया) (MADHUSUDAN SAWDIA) लेखा सदस्य/ACCOUNTANT MEMBER Sd/- (श्री रवीश सूद) (RAVISH SOOD) न्यायिक सदस्य/JUDICIAL MEMBER Hyderabad, dated 20.08.2025. TYNM/sps आदेशकी प्रनतनलनप अग्रेनर्त/ Copy of the order forwarded to:- 1. निर्धाररती/The Assessee : Minhajus Sharquia Educational Society, 17-8-467, Yakutpura Post, Dabeerpura, Hyderabad – 500023, Telangana. 2. रधजस्व/ The Revenue : The Income Tax Officer, Ward 9(1), Hyderabad. 3. The Principal Commissioner of Income Tax (Exemptions), Hyderabad. 4. नवभधगीयप्रनतनिनर्, आयकर अपीलीय अनर्करण, / DR, ITAT, Hyderabad. 5. गधर्ाफ़धईल / Guard file आदेशधिुसधर / BY ORDER Sr. Private Secretary ITAT, Hyderabad. Printed from counselvise.com "