PANDIT KALHAN SCHOLARSHIP TRUST,JAMMU V. CIT(E), CHANDIGARH, CHANDIGARH

ITA 25/ASR/2025

AI Insights

The case involves the Pandit Kalhan Scholarship Trust appealing against the rejection of their application for registration under section 12A(1)(ac)(iii) of the Income Tax Act, 1961, by the Commissioner of Income Tax (Exemptions), Chandigarh. The initial rejection was due to a non-compliance issue with the dissolution clause in the Trust Deed. The Tribunal noted that the Trust had subsequently amended the Trust Deed to address these concerns and had submitted the revised document. The Tribunal found that the Trust was not given adequate opportunity to respond to the notices due to the closure of the e-filing portal and the timing of the notices, leading to the decision to remand the case for fresh consideration.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 705313 (ITAT-AMRITSAR)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-06-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: M.S. NETHRAPAL
• Assessee Lawyers: U. K. HANDOO
• Keywords: Set aside; Opportunity of being heard
• Section: 12AA; 12A; 80G

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH: AMRITSAR. BEFORE SH. UDAYAN DAS GUPTA, JUDICIAL MEMBER AND SH. BRAJESH KUMAR SINGH, ACCOUNTANT MEMBER I.T.A. No. 24 & 25/Asr/2025 Assessment Year.: N/A Pandit Kalhan Scholarship Trust H.No. 36, Lower Laxmi Nagar, S.O. Rehari Mohalla, Jammu, Jammu, and Kashmir. [PAN: AAFTP3492K] (Appellant) Vs. Commissioner of Income Tax, (Exemptions), Chandigarh. (Respondent) Appellant by Sh. U. K. Handoo, CA. Respondent by Sh. M.S. Nethrapal, CIT. DR Date of Hearing 29.05.2025 Date of Pronouncement 30.06.2025 ORDER Per: Udayan Das Gupta, J.M.: This appeal is filed by the assessee against the order of the ld. Commissioner of Income Tax (Exemptions), Chandigarh, dated 13.12.2024 rejecting the application for registration u/s 12A(1)(ac)(iii) of the Act 1961 due to non- compliance with the dissolution clause in the Trust Deed filed by the assessee. ITA 24/ASR /2025 2. The grounds taken by the assessee in memorandum of appeal are as follows: I.T.A. No. 24 & 25/Asr/2025 Assessment Year.: N/A 2 “1. The order of worthy CIT (E) is bad in law and on facts of the case 2. The worthy CIT (E) has disposed of the application u/s 12AA of Income Tax Act, 1961 on the plea being deficient in factual evidences in the absence of the requisite submissions of the applicant at the scheduled hearings. 3. The department had asked for information of dissolution clause in the Trust Deed & the appellant was engaged in such process and submitted the documents to the Office of SDM for registration of revised Trust Deed. It took few days to obtain a copy of revised Trust deed from the office of SDM. Meanwhile, a notice was served on 09.12.2024 fixing the date for 12.12.2024 & this remained unreplied due to the reasons that the appellant was busy with the process of registration of revised Trust Deed. No other opportunity was granted to the appellant by the Office of worthy CIT (E) & as such the case laws cited in the rejection order do not apply to the appellant as many opportunities have not been granted except or fixing of the date on 12.12.2024. Moreover, no further opportunities were granted and in fact the portal for submission of replies was immediately closed & as such the impugned rejection order is unjustifiable. The appellant, therefore, request to set aside the rejection order. 4. The Appellant craves the right to add, alter or modify any grounds of appeal before or at the time of hearing of the appeal.” I.T.A. No. 24 & 25/Asr/2025 Assessment Year.: N/A 3 3. Brief facts emerging from the record are that application filed by the assessee for registration u/s 12AA of the Act has been rejected by the ld. CIT(E) on account of factual deficiency. 3.1 During the course of registration proceedings, notices has been issued from the office of the ld. CIT(E), in order to verify the genuineness of the activities and the objects of the trust. However, considering the reply filed by the assessee it was seen that in the deed of trust furnished by the assessee, there is no proper clarification in the dissolution clause, which makes it difficult to ascertain as to how the assets of the assessee trust will be distributed in case, the trust is dissolved. Necessary queries were raised by various notices issued from the office of the ld. CIT(E) against which adjournment has been sought by the assessee but no proper reply has been filed and in absence of any proper representation from the assessee the application for registration has been rejected. 3.2 Before the Tribunal the ld. AR of the assessee submitted that the deed of trust has been revised with necessary amendments, and the issue regarding dissolution of trust has been duly addressed and a copy of the said revised or amended deed of trust has been submitted before us in (pages 11 to 16 of the paper book). I.T.A. No. 24 & 25/Asr/2025 Assessment Year.: N/A 4 3.3 The ld. AR further submitted that the notice issued calling for necessary particulars has been served on the assessee on 09.12.2024 fixing the case on 12th December 2024 which means within 3 (three days) and thereafter no further opportunities has been allowed to the assessee to file the necessary particulars and the e-filed portal for submission of replies were immediately closed and the assessee was prevented by sufficient cause from uploading his reply in response to such notice. 3.4 As such, he prays before the tribunal that an opportunity of hearing may please be allowed to the trust for submission of all papers and necessary documents for the purpose of proper adjudication in the mater and for considering the same along with the amended trust deed. 4. The ld. DR has no objection, if the matter is remanded back to the file of the ld. CIT(E) for fresh adjudication after compliance with necessary deficiency. 5. We have heard the rival submissions and considered the materials on record and we find that the trust deed has been amended and copy of the same filed before us which needs to be considered by the ld. CIT(E) and also considering the fact that proper and reasonable opportunity has not been allowed to the assessee for submission of all papers and documents, we consider it fit and proper to remand the I.T.A. No. 24 & 25/Asr/2025 Assessment Year.: N/A 5 matter back to the file of the ld. CIT(E) for fresh consideration of the application for registration. 5.1 We also direct the assessee to file all necessary particulars and documents as per queries raised by the ld. CIT(E) within a period of 30 days (thirty days) from the date of the receipt of this order along with amended copies of trust deed and to fully cooperate in the registration proceedings. The ld. CIT(E) shall allow proper and reasonable opportunity of being heard to the assessee and shall proceed with the application for registration afresh as per provisions of law. We have not express any opinion on merits and all legal issue are left open. The appeal of the assessee is allowed for statistical purposes. ITA No. 25/ASR/2025 6. This appeal is filed by the assessee against rejection of approval. The application for approval u/s 80G of the Act 1961 has been e-filed by the assessee on 28.06.2024 in Form 10 AB, which has been rejected on the ground that the application of registration u/s 12A (1)(ac)(iii) has been rejected. 7. We have already remanded the matter back to the ld. CIT(E) in ITA 24/Asr/2025 and we also remand this matter back to the file of the ld. CIT(E) for adjudication afresh. Our observation in the above appeal shall apply mutatis mutandis to this appeal also, and we remand this appeal for fresh consideration in I.T.A. No. 24 & 25/Asr/2025 Assessment Year.: N/A 6 Coordination with the application for registration u/s 12AB, and for disposal of the same accordingly. This appeal is also allowed for statistical purposes. 8. In the result, both the appeals of the assessee bearing ITA Nos. 24 & 25/Asr/2025 are allowed for statistical purposes. Order pronounced on 30.06.2025 at Amritsar, Punjab in accordance with Rule 34(4) of the Income tax (Appellate Tribunal) Rules, 1963. Sd/- Sd/- (BRAJESH KUMAR SINGH) (UDAYAN DAS GUPTA) Accountant Member Judicial Member Copy of the order forwarded to: (1)The Appellant (2) The Respondent (3) The CIT (4) The DR, I.T.A.T. True Copy By Order I.T.A. No. 24 & 25/Asr/2025 Assessment Year.: N/A 7 "