NASHIK SURGICAL SOCIETY,NASHIK V. CIT(E), PUNE

ITA 2523/PUN/2024

AI Insights

The case involves Nashik Surgical Society Pinnacle Endoscopy & Diagnostic Centre appealing against the order of the CIT (Exemption), Pune, which rejected their application for approval under section 80G of the Income Tax Act, 1961. The CIT (Exemption) had rejected the application due to non-compliance in providing necessary details to verify the genuineness of the assessee's activities, despite multiple opportunities given. The assessee argued that the rejection was based on an incorrect email address used for communication, leading to non-compliance. The Tribunal considered the circumstances and decided to restore the matter to the CIT (Exemption) for a fresh decision after providing the assessee an opportunity to present their case.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 312154 (ITAT-PUNE)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-04-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: misc
• Other Referred Cases: Connecting Trust vs. CIT (Exemption), Pune
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAVI PRAKASH
• Assessee Lawyers: SANKET M JOSHI
• Keywords: Set aside; Opportunity of being heard; Reasonable cause
• Section: 80G

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH “A”, PUNE BEFORE SHRI R. K. PANDA, VICE PRESIDENT AND MS. ASTHA CHANDRA, JUDICIAL MEMBER ITA No.2523/PUN/2024 Nashik Surgical Society Pinnacle Endoscopy & Diagnostic Centre, Dattaraj Appt, Near Ahirrao Photo Studio, College, Nashik – 422005, Maharashtra Vs. The CIT (Exemption), Pune PAN: AABTN6522F (Appellant) (Respondent) Assessee by : Shri Sanket M Joshi Department by : Shri Ravi Prakash Date of hearing : 28-04-2025 Date of pronouncement : 29-04-2025 O R D E R PER R. K. PANDA, VP : This appeal filed by the assessee is directed against the order dated 27.09.2024 of the Ld. CIT (Exemption), Pune rejecting the application for approval u/s 80G of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’). 2. Facts of the case in brief, are that the assessee filed an application in Form No.10AB on 23.05.2024 for approval under clause (iii) of first proviso to sub section (5) of section 80G of the Act. With a view to verify the genuineness of the activities of the assessee and fulfillment of conditions laid down in clause (i) to (v) of section 80G(5) of the Act, a notice was issued through ITBA portal on 24.06.2024 requesting the assessee to upload certain information / clarification. 2 ITA No.2523/PUN/2024 Since there was no response from the side of the assessee despite number of opportunities granted, the Ld. CIT(E) rejected the application for grant of approval u/s 80G of the Act and also cancelled the provisional registration granted earlier by observing as under: “5. The information / details were called for under the provisions of sub-clause (a) of clause (ii) of second proviso to section 80G(5) 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 sub-clause (a) of clause (ii) of second proviso to section 80G(5) of the Income Tax Act, 1961 to verify the genuineness of activities of the trust or institution and fulfilment of conditions laid down in clauses (i) to (v) of Section 80G(5) of the Act. 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 fulfilment of conditions laid down in clauses (i) to (v) of Section 80G(5) of the Act. 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 sub-clause (a) of clause (ii) of second proviso to section 80G(5) of the Income Tax Act, 1961 and hence, the undersigned is unable to draw any satisfactory conclusion about genuineness of activities of the assessee and fulfilment of conditions laid down in clauses (i) to (v) of Section 80G(5) of the Act and has left no alternative but to reject the application. 9 Without prejudice to the above, it is seen that the trust has obtained provisional registration in form 10AC under item (A) on 17/01/2024. However, as per submission the trust's activities were commenced atleast from the F.Y 2020-21-21 i.e. before the date of provisional registration Therefore, said provisions of sec.80G (5)(iv) (A) of the Act are not applicable to the assessee's case. 10. In view of the above, the application filed by the assessee is hereby rejected and the provisional approval dated 17/01/2024 under item (A) Sub-clause (A) of clause (Iv) of first proviso to sub-section (5) of section 80G(5) 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: 3 ITA No.2523/PUN/2024 1] The learned CIT(E) erred in rejecting application filed by the appellant in Form 10AB for approval under clause (iii) of first proviso to section 80G(5) on an ex-parte basis without appreciating that the said action was not justified on facts and in law. 2] The learned CIT(E) failed to appreciate that there was a reasonable cause due to which proper compliance was not made to the notices of hearing, in as much as, the notices were issued on email id [e-mail] belonging to one of the erstwhile trustees who did not intimate the assessee regarding the receipt of said notices and not on the email id mentioned in Form 10AB ie [e-mail] and hence, it is prayed that the matter may please be set aside to the file of the Ld. CIT(E) to adjudicate the same on merits after affording proper opportunity of being heard to the appellant. 3] The assessee submits that it has made due compliance in the 12AB proceedings and it has been granted final registration u/s 12AB by CIT(E) vide order dated 25.04.2024 and thus, it is prayed that the CIT(E) may please be directed to decide the application for registration u/s 80G afresh after granting one more opportunity of being heard in the interest of justice. 4] The learned CIT(E) further erred in rejecting the application filed by the appellant in Form 10AB for approval under clause (iii) of first proviso to section 80G(5) on the ground that the erstwhile application in Form 10A was filed under incorrect sub clause (A) of clause (iv) of first proviso to section 80G(5) instead of filing the same under sub clause (B) of clause (iv) of first proviso to section 80G(5) without appreciating that in the present application filed for final approval under clause (iii) of first proviso to section 80G(5), the scope of verification by the CIT should have been restricted to satisfying himself about genuineness of activities and fulfillment of conditions laid down in clauses (i) to (v) of section 80G(5) and therefore, the above reason stated by the CIT for rejecting the present application was not justified in law. 5] The appellant craves leave to add/ alter/ amend any of the grounds of appeal. 4. The Ld. Counsel for the assessee at the outset submitted that the hearing notices issued by the Ld. CIT(E) went to the e-mail ID of one of the old trustees instead of the e-mail ID mentioned in the application for which there was no compliance before the Ld. CIT(E). He submitted that in the interest of justice, the assessee should be given an opportunity to substantiate its case by filing the requisite details before the Ld. CIT(E). He also filed the decision of the Pune 4 ITA No.2523/PUN/2024 Bench of the Tribunal in the case of Connecting Trust vs. CIT (Exemption), Pune vide ITA No.2437/PUN/2024, order dated 14.02.2025 where the Tribunal has restored the issue to the file of the Ld. CIT(E) with a view to consider the application afresh treating the same filed under clause (iii) in accordance with law. 5. The Ld. DR on the other hand submitted that despite number of opportunities granted by the Ld. CIT(E), the assessee did not respond, therefore, the order of the Ld. CIT(E) should be upheld. 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 despite a number of opportunities granted by the Ld. CIT(E), the assessee did not respond to the same for which the Ld. CIT(E) rejected the application for grant of approval u/s 80G of the Act and also cancelled the provisional registration granted earlier. It is the submission of the Ld. Counsel for the assessee that the notices went to the e-mail ID of the one of the old trustees instead of the correct e-mail ID which was given in the application form. It is also his submission 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 5 ITA No.2523/PUN/2024 appointed date without seeking any adjournment under any pretext, 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 29th April, 2025. Sd/- Sd/- (ASTHA CHANDRA) (R. K. PANDA) JUDICIAL MEMBER VICE PRESIDENT पुणे Pune; दिन ांक Dated : 29th April, 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.2523/PUN/2024 S.No. Details Date Initials Designation 1 Draft dictated on 28.04.2025 Sr. PS/PS 2 Draft placed before author 29.04.2025 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 "