SALEEM AND MUINRA MERCHANT CHARITABLE FOUNDATION,THANE V. DCIT CIRCLE 15(1)(1)9, MUMBAI, MUMBAI

ITA 2121/MUM/2025

AI Insights

The case involves the Saleem and Muinra Merchant Charitable Foundation appealing against the orders of the CIT(E) which denied their registration under sections 12A and 80G of the Income Tax Act. The primary reason for the denial was the inclusion of a clause in the trust's objectives that violated section 11 of the Act, as it intended to apply/receive funds outside India. The foundation argued that they were not given sufficient opportunity to respond to the show cause notice before the rejection of their application. Additionally, they had amended the contentious clause and notified the Ministry of Corporate Affairs. The Tribunal found that the CIT(E) had not provided adequate opportunity for the foundation to present their case, which constituted a violation of the principles of natural justice.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 713081 (ITAT-MUMBAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-07-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Assessment Year: 2024-2025
• Other Referred Cases: Collector Land Acquisition Vs. Mst. Katiji & Ors. (1987) 167 ITR 471
• Laws Referred To: Section 12A of the Income Tax Act, Section 80G of the Income Tax Act, Section 11 of the Income Tax Act, Limitation Act of 1963
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: ARUN KANTI DATTA
• Assessee Lawyers: PIYUSH BAFNA
• Keywords: Condonation of delay; Opportunity of being heard; Reasonable cause; Principle of natural justice
• Section: 11; 12A; 80G

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL “G” BENCH, MUMBAI BEFORE SMT. BEENA PILLAI (JUDICIAL MEMBER) AND SHRI GIRISH AGRAWAL (ACCOUNTANT MEMBER) I.T.A. No. 2121/Mum/2025 Assessment Year: 2024-25 & I.T.A. No. 2122/Mum/2025 Assessment Year: 2024-25 Saleem and Muinra Merchant Charitable Foundation F205, Tower 2, Plot No. R- 1, Sector 40, Seawoods, Darave, Thane Maharashtra-400706 PAN:ABLCS4734Q Vs. DCIT Circle 15(1)(1) 9 Aayakar Bhawan Mumbai-400020 (Appellant) (Respondent) Appellant by Shri Piyush Bafna Respondent by Shri Arun Kanti Datta, CIT D.R. Date of Hearing 03.07.2025 Date of Pronouncement 28.07.2025 ORDER Per: Smt. Beena Pillai, J.M.: Printed from counselvise.com 2 ITA No. 2121 & 2122/Mum/2025; A.Y. 2024-25 Saleem and Muinra Merchant Charitable Foundation The present appeals are filed by the assessee against orders dated 26/12/2024 passed by Ld.CIT(E), denying the registration u/s.12A and 80G of the Act. Brief facts of the case are as under: 2. At the outset the Ld.AR submitted that there is a delay of about 31 days in filing the present appeals before this Tribunal. 2.1 The assessee filed application seeking condonation of delay along with affidavit in support of the same. Scanned and annexed here with is the affidavit the director of Saleem and Munira Merchant Charitable Foundation: Printed from counselvise.com 3 ITA No. 2121 & 2122/Mum/2025; A.Y. 2024-25 Saleem and Muinra Merchant Charitable Foundation Printed from counselvise.com 4 ITA No. 2121 & 2122/Mum/2025; A.Y. 2024-25 Saleem and Muinra Merchant Charitable Foundation Printed from counselvise.com 5 ITA No. 2121 & 2122/Mum/2025; A.Y. 2024-25 Saleem and Muinra Merchant Charitable Foundation 3. From the above it is noted that, the reason that caused delay in filing appeal before this Tribunal was because the assessee awaiting legal advice and was not aware if assessee could file appeal against the impugned order. For this reason, the delay occurred and submitted that, there is no malafide intention attributable to the assessee in causing the delay in filing the present appeal before this Tribunal. The Ld.AR relied on the order of the Hon’ble Supreme Court in case of Collector Land Acquisition Vs. Mst. Katiji & Ors., reported in (1987) 167 ITR 471. 3.1 On the contrary, the Ld.DR though vehemently opposed the condonation of delay was of the opinion that the issue should be decided on merits. We have perused the submissions advanced by both sides in the light of records placed before this Tribunal. 4. In our opinion, the assessee made out a reasonable cause for the delay that caused in filing the present appeal before this Tribunal. Nothing to establish anything contrary has been filed by the revenue before this Tribunal. Thus there is ‘sufficient cause’ for condoning the delay as observed by Hon’ble Supreme Court in case of Collector Land Acquisition Vs. Mst. Katiji & Ors., reported in (1987) 167 ITR 471 in support of his contentions. 4.1 We place reliance on following observations by Hon’ble Supreme Court in case of Collector Land Acquisition Vs. Mst. Katiji & Ors., reported in (1987) 167 ITR 471 wherein, Hon’ble Court observed as under:- Printed from counselvise.com 6 ITA No. 2121 & 2122/Mum/2025; A.Y. 2024-25 Saleem and Muinra Merchant Charitable Foundation “The Legislature has conferred the power to condone delay by enacting section 51 of the Limitation Act of 1963 in order to enable the courts to do substantial justice to parties by disposing of matters on de merits\". The expression “sufficient cause” employed by the Legislature is adequately elastic to enable the courts to apply the law in a meaningful manner which subserves the ends of justice that being the life-purpose of the existence of the institution of courts. It is common knowledge that this court has been making a justifiably liberal approach in matters instituted in this court. But the message does not appear to have percolated down to all the other courts in the hierarchy. And such a liberal approach is adopted on principle as it is realized that : 1. Ordinarily, a litigant does not stand to benefit by lodging an appeal late. 2. Refusing to condone delay can result in a meritorious matter being thrown out at the very threshold and cause of justice being defeated. As against this, when delay is condoned, the highest that can happen is that a cause would be decided on merits after hearing the parties. ......................................................1.Any appeal or any application, other than an application under any of the provisions of Order XXI of the Code of Civil Procedure, 1908, may be admitted after the prescribed period if the appellant or the applicant satisfies the court that he had sufficient cause for not preferring the appeal or making the application within such period.” 4.2 Considering the submissions by both sides and respectfully following the observation by Hon’ble Supreme Court, we find it fit to condone the about 31 days delay caused in filing the present appeal as it is not attributable to the assessee. Accordingly delay in filing both the present appeals before this Tribunal stands condoned. 5. On merits the Ld.AR submitted that, registration u/s.12A was denied as the assessee had one of its object clause which was in violation of provisions sub section 11 of the Act, since the trust intends to apply/receive funds outside India. He submitted that, a show cause notice was issued on 21/12/2024 to the Printed from counselvise.com 7 ITA No. 2121 & 2122/Mum/2025; A.Y. 2024-25 Saleem and Muinra Merchant Charitable Foundation assessee in respect of the same, and without giving sufficient opportunity, orders rejecting the registration u/s. 12A & 80G was passed on 26/12/2024. 5.1 The Ld.AR submitted that the assessee has amended its object clause and the same has been furnished with the ministry of corporate affairs. He thus submitted that, the assessee may be granted an opportunity of being heard before Ld.CIT(E) to substantiate its claim as there was violation of principle natural justice. 5.2 On the contrary, the Ld.DR relied on the orders passed by the authorities below. We have perused submissions advance by both sides in the light of records placed before us. 6. It is noted that, the assessee was not granted sufficient opportunity of being heard by the Ld.CIT(E) which is in violation of principle natural justice. Considering the fact that the assessee also amended the object clause that was in violation of section 11 of the Act, the Ld.CIT(E) is directed to reconsider the application seeking registration u/s.12A and 80G in accordance with law. Needless to say that proper opportunity of being heard must be granted to the assessee. Accordingly the grounds raised by the assessee in both the appeals stands partly allowed for statistical purposes. In the result the both the appeals filed by the assessee stands partly allowed for statistical purposes Printed from counselvise.com 8 ITA No. 2121 & 2122/Mum/2025; A.Y. 2024-25 Saleem and Muinra Merchant Charitable Foundation Order pronounced in the open court on 28/07/2025 Sd/- Sd/- (GIRISH AGRAWAL) (BEENA PILLAI) Accountant Member Judicial Member Mumbai: Dated: 28/07/2025 Poonam Mirashi, Stenographer Copy of the order forwarded to: (1)The Appellant (2) The Respondent (3) The CIT (4) The CIT (Appeals) (5) The DR, I.T.A.T. True Copy By order (Asstt. Registrar) ITAT, Mumbai Printed from counselvise.com "