SALAFIYA EDUCATION AND WELFARE TRUST,SOLAPUR V. .CIT EXEMPTION, PUNE, PUNE

ITA 1215/PUN/2024

AI Insights

The case involves Salafiya Education and Welfare Trust, which appealed against the orders of the Commissioner of Income Tax (Exemption), Pune, denying them registration under section 12A and approval under section 80G(5) of the Income Tax Act, 1961. The Trust had applied for registration and faced multiple notices from the CIT (Exemption) regarding discrepancies in their application. The Tribunal noted that the time allowed for compliance was unreasonable and that the principles of natural justice were not adequately followed. Consequently, the Tribunal set aside the CIT's orders and remitted the case for a fresh decision, emphasizing the need for fair opportunity and compliance with legal provisions.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 474131 (ITAT-PUNE)
• Duration Of Justice: 6 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-12-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: misc
• Appeal Filed On: 27-05-2024
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANISH KUMAR SINGH
• Assessee Lawyers: P. D. KUDVA
• Keywords: Reasonable cause; Principle of natural justice

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCHES “B”, PUNE BEFORE DR.MANISH BORAD, ACCOUNTANT MEMBER AND SHRI VINAY BHAMORE, JUDICIAL MEMBER आयकर अपील सं. / ITA Nos.1215 and 1214/PUN/2024 Salafiya Education and Welfare Trust, Bagum Peth, Solapur 413 001 Maharashtra PAN : AAUTS2399P Vs. CIT (Exemption), Pune Appellant Respondent आदेश / ORDER PER DR. MANISH BORAD, ACCOUNTANT MEMBER : The captioned appeals at the instance of appellant are directed against the orders framed by ld. Commissioner of Income Tax (Exemption), Pune both dated 28.03.2024 denying grant of registration u/s.12A and approval u/s.80G(5) of the Income Tax Act, 1961 (‘the Act’). ITA No.1215/PUN/2024 : 2. Tersely, the facts of the case are that the appellant filed application on Form No.10AB under clause (iii) of section 12A(1)(ac) of the Act for grant of regular registration u/s.12A of the Act on 26.09.2023. In order to verify the genuineness of activities of the appellant, the ld. CIT (Exemption) issued a notice through ITBA portal on 17.11.2023 calling upon the appellant trust to file certain information/clarification. The appellant filed the requisite details. However, the ld.CIT(E) issued another Assessee by : Shri P.D. Kudva Revenue by : Shri Manish Kumar Singh Date of hearing : 04.12.2024 Date of pronouncement : 09.12.2024 ITA Nos.1215 and 1214/PUN/2024 Salafiya Education and Welfare Trust 2 notice to the appellant on 14.02.2024 pointing out certain discrepancies (para 2.2 of the impugned order). The assessee responded to the said notice on 23.02.2024. Thereafter, the ld.CIT(E) issued another notice on 24.03.2024 communicating certain other discrepancies. There was no compliance by the assessee to such notice. In the circumstances, the ld.CIT(E) rejected the application filed by the appellant, thereby cancelling the provisional registration granted to it by observing as under : “3.2. Since, the assessee has not furnished any explanation to the discrepancies communicated to it, it is presumed that the assessee has nothing to say in the matter. 4. Considering the above facts discussed in the show notice and discrepancies noticed and also that the assessee has not complied with the provisions of section 12AB(1)(b)(i) of the Income Tax Act, 1961 as well as the provisions of Rule 17A(2) of Income Tax Rules, 1962 in spite giving sufficient opportunities, the undersigned is unable to draw any satisfactory conclusion about the genuineness of activities of the assessee and compliance of requirements of any other law for the time being in force by the assessee as are material for the purpose of achieving its objects. 5. In view of the above, the application filed by the assessee is hereby rejected and the provisional registration granted on 08/12/2022 under section 12AB read with section 12A(1)(ac) (vi) of the Income Tax Act, 1961 is hereby cancelled.” 3. Aggrieved appellant approached the Tribunal challenging the impugned order denying grant of registration u/s.12A of the Act. 4. We have heard the parties and perused the relevant material on record. We note that the ld.CIT(A) issued notice dated 24.03.2024 to the appellant fixing the date of compliance as 27.03.2024, non-compliance of which led to passing of the impugned order. We find obviously the time allowed to the appellant for compliance is unreasonable. We have given our ITA Nos.1215 and 1214/PUN/2024 Salafiya Education and Welfare Trust 3 thoughtful consideration to the facts and circumstances of the case, lack of proper and fair opportunity having been granted to appellant trust and the principles of natural justice being fair to both the parties. Considering the same, we are of the view that the appellant was for sufficient cause prevented from prosecuting the appeal effectively, therefore deserves to be given one more opportunity to prove its case on merits. In view thereof, without dwelling into merits of the issue, we set-aside the impugned order under challenge and remit back to the file of Ld. CIT(E) to the stage of its institution with a direction to adjudicate the subject matter denovo in accordance with law after providing three effective opportunities and pass a speaking order. Appellant is also directed to remain vigilant and make satisfactory compliance to the notice(s) of hearing issued by ld.CIT(E). It should refrain from taking adjournments unless otherwise required for reasonable cause. Effective grounds of appeal raised by the appellant are allowed for statistical purposes. ITA No.1214/PUN/2024 : 5. The instant appeal is against the order framed by ld.CIT(A) denying grant of approval u/s.80G(5) of the Act. Since we have remanded the issue of grant of registration to the file of ld.CIT(E) for denovo adjudication, therefore, in the interest of justice, it would be appropriate to remit the issue of grant of approval u/s.80G(5) as well to the file of ld.CIT(E), being consequential, for denovo adjudication. ITA Nos.1215 and 1214/PUN/2024 Salafiya Education and Welfare Trust 4 6. In the result, both the appeals of the assessee are allowed for statistical purposes. Order pronounced on this 09th day of December, 2024. Sd/- Sd/- (VINAY BHAMORE) (MANISH BORAD) JUDICIAL MEMBER ACCOUNTANT MEMBER पुणे / Pune; \u0001दनांक / Dated : 09th December, 2024. Satish आदेश क\u0002 \u0003ितिलिप अ\tेिषत / Copy of the Order forwarded to : 1. अपीलाथ\f / The Appellant. 2. \r\u000eयथ\f / The Respondent. 3. The Pr. CIT concerned. 4. िवभागीय \rितिनिध, आयकर अपीलीय अिधकरण, “B” ब\u0014च, पुणे / DR, ITAT, “B” Bench, Pune. 5. गाड\u0004 फ़ाइल / Guard File. आदेशानुसार / BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलीय अिधकरण, पुणे / ITAT, Pune. "