SARASWATI MANDIR SANSTHA,PUNE V. C.I.T (EXEMPTION), PUNE, PUNE

ITA 2650/PUN/2024

AI Insights

The case involves Saraswati Mandir Sanstha, a trust, which appealed against the decision of the Commissioner of Income Tax (Exemption), Pune, denying them registration under section 12A of the Income Tax Act, 1961. The denial was based on the incorrect section code used in Form 10AB during the application process. The Tribunal found that the error was inadvertent and not fatal to the application, referencing a similar case (Shree Swaminarayan Gadi Trust Vadtal) where a similar mistake was rectified. The Tribunal emphasized the importance of natural justice and directed the CIT(E) to allow the appellant to amend the application and reconsider it on merits.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 474142 (ITAT-PUNE)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-02-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: misc
• Other Referred Cases: Shree Swaminarayan Gadi Trust Vadtal (SVG) Vs. CIT (Exemptions), ITA No.2650/PUN/2024
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ARVIND DESAI
• Assessee Lawyers: SHARAD A. VAZE
• 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 MS. ASTHA CHANDRA, JUDICIAL MEMBER आयकर अपील सं. / ITA No.2650/PUN/2024 Saraswati Mandir Sanstha, 1359, Saraswati Mandir, Bajirao Road, Pune 411 002 Maharashtra PaN : AACTS1638N Vs. CIT (Exemption), Pune Appellant Respondent आदेश / ORDER PER DR. MANISH BORAD, ACCOUNTANT MEMBER : The captioned appeal at the instance of appellant is directed against the order framed by ld. Commissioner of Income Tax (Exemption), Pune dated 22.11.2024 denying grant of registration u/s.12A of the Income Tax Act, 1961 ( in short ‘the Act’). 2. Appellant has raised following grounds of appeal : “1. On the basis of facts and in the circumstances of the case and as per law, the Commissioner of Income Tax (Exemptions), Pune, is not justified in rejecting the regular registration even after the submission of information called from the appellant-trust The rejection is only on the hyper-technical ground of wrong section code inadvertently /mistakenly used by the appellant in Form 10AB. The Commissioner of Income Tax (Exemptions) Pune be directed to consider Form 10AB filed on 27.03.2024 as having been filed under Clause (iii) of sec 12A(1)(ac), by condoning the delay / limitation, if any. The appellant craves leave to add, alter, omit or substitute any of the grounds at the time of hearing of the appeal.” Appellant by : Shri Sharad A. Vaze Revenue by : Shri Arvind Desai Date of hearing : 11.02.2025 Date of pronouncement : 14.02.2025 ITA No.2650/PUN/2024 Saraswati Mandir Sanstha 2 3. Succinctly, the facts of the case are that the appellant is a Trust, filed application on Form No.10AB under clause (vi) of section 12A(1)(ac) of the Act for grant of regular registration on 03.07.2024. In order to verify the genuineness of activities of the appellant, the ld. CIT (Exemption) issued a notice through ITBA portal on 30.08.2024 calling upon the appellant to file certain information/clarification. There was no compliance from the side of appellant 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. 4. Aggrieved appellant is now in appeal before the Tribunal in the present appeal assailing the impugned order denying grant of registration u/s.12A of the Act. 5. Ld. Counsel for the appellant submitted that the application of the appellant has been rejected on hyper-technical ground. The appellant has selected wrong code inadvertently while filing the application in Form No.10AB. Therefore, the appellant may be given an opportunity for rectification of the same. 6. On the other hand, ld. Departmental Representative submitted that ld.CIT(E) has rightly rejected the application filed by the appellant. 7. We have heard both the sides and perused the record placed before us. The main grievance of the issue agitated in this appeal is selection of wrong section code by the appellant pertaining to renewal of regular registration other than section 12A(1)(ac)(iii) of the Act. We note that similar issue came up for adjudication before Coordinate Bench, Surat in the case of Shree Swaminarayan Gadi Trust Vadtal (SVG) Vs. CIT (Exemptions), ITA No.2650/PUN/2024 Saraswati Mandir Sanstha 3 Ahmedabad in ITA Nos. 369 & 370/Srt/2024, dated 13.05.2024 and the finding of the Tribunal reads as under : “5. We have considered the submissions of both the parties and perused the record carefully. There is no dispute that the appellant applied for registration under Section 12A/12AB of the Act under Form 10AB on 28.09.2023. The ld. CIT(E) while considering the application of appellant noted that the application filed by appellant is not maintainable and accordingly, a show cause notice dated 02/11/2023 was issued for seeking clarification. The appellant responded to the show cause notice of ld CIT(E) vide their reply dated 15.12.2023. The contents of show cause notice and the reply thereof is not recorded by ld CIT(E) in his order. We find that the appellant vide their reply dated 15/12/2023 prayed to consider the application in appropriate sub- clause of section 12A(1). The ld CIT(E) held that he has no power to change/ amend or rectify Form-10AB. We find that it was an inadvertent mistake and the appellant has already explained the facts and prayed for correction before the ld. CIT(E). In our view the mistake in filing entry was not fatal and could be considered in appropriate sub-clause or clause of section 12A(1). Otherwise, the appellant has provided all the details and information in Form-10AB, while applying for registration under section 12A/12AB. Being first appellate authority, the plea of appellant for correction in Form-10AB is accepted and the order of ld CIT(E) is set-aside. The registry official of ld CIT(E) maintaining record of ITBA portal about the registration of trust under section 12A/12AB is directed either to correct such mistake or allow the appellant to rectify or amend the relevant clause/ sub-clause of section 12A(1). Considering the fact that the application of appellant was not considered on merit, therefore, we deem it appropriate to direct the ld. CIT(E) to treat the application of appellant under Section 12A(1)(ac)(iii) in place of Section 12A(1)(ac)(iv) of the Act and to consider the case on merit and pass the order in accordance with law. Needless to direct that before passing the order, the ld CIT(E) shall grant opportunity of hearing to the appellant. The appellant is also directed to furnish complete details to prove its object and activity and make all compliances as desired by the ld. CIT(E). In the result, the grounds of appeal raised by the appellant are allowed for statistical purposes only.” 8. In light of the above decision and having given our thoughtful consideration to the given facts and circumstances prevailing in the instant case, we are of the opinion that the ld. CIT(E) ought to have given an opportunity to the appellant to ITA No.2650/PUN/2024 Saraswati Mandir Sanstha 4 rectify the defect. Further we are of the view that wrong selection of section code/clause would not disentitle the appellant to its rightful claim. Selection of wrong clause by the appellant cannot be treated as fatal to the proceedings initiated after the filing of the application. We therefore in the interest of natural justice being fair to both the parties deem it appropriate to grant one more opportunity to the appellant, setting aside the impugned order to the file of ld. CIT(E). The ld.CIT(E) shall give an opportunity to the appellant to file the correct application and then decide the case on merits denovo after granting reasonable opportunity to the appellant. 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. 9. In the result, the appeal of the appellant is allowed for statistical purposes. Order pronounced on this 14th day of February, 2025. Sd/- Sd/- (ASTHA CHANDRA) (MANISH BORAD) JUDICIAL MEMBER ACCOUNTANT MEMBER पुणे / Pune; \u0001दनांक / Dated : 14th February, 2025. Satish ITA No.2650/PUN/2024 Saraswati Mandir Sanstha 5 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. "