SHARDABEN ARJANBHAI DHOLAKIYA WELFARE TRUST,SURAT V. CIT(EXEMPTION), AHMEDABAD, AHMEDABAD

ITA 1307/SRT/2024

AI Insights

The case involves three appeals by the Shardaben Arjanbhai Dholakiya Welfare Trust against the orders of the Commissioner of Income-tax (Exemption), Ahmedabad, which rejected the Trust's applications for registration under sections 12A and 80G(5) of the Income-tax Act, 1961. The Tribunal found that the initial rejections were based on procedural oversights and insufficient consideration of the Trust's submissions. The Tribunal emphasized the importance of natural justice and remitted the cases back to the CIT(E) for a fresh examination, allowing the Trust an opportunity to present its case adequately.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 313006 (ITAT-SURAT)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-04-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: misc
• Other Referred Cases: Mandava Foundation vs. CIT(E), Parmeshwari Bai Memorial Trust vs. CIT(E), Rambha Charitable Trust vs. CIT(E)
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ASHISH POPHARE
• Assessee Lawyers: RASESH SHAH
• Keywords: Set aside; Opportunity of being heard; Reasonable cause; Principle of natural justice; Bonafide mistake; Charitable institution
• Section: 12A

Judgement Text

" IN THE INCOME-TAX APPELLATE TRIBUNAL, SURAT BENCH, SURAT BEFORE MS SUCHITRA RAGHUNATH KAMBLE, JUDICIAL MEMBER & SHRI BIJAYANANDA PRUSETH, ACCOUNTANT MEMBER आयकर अपील सं./ITA Nos.1306 to 1308/SRT/2024 (Physical Hearing) Shardaben Arjanbhai Dholakiya Welfare Trust, B-8, Vallabhnagar Society, Opp – Baroda Pristage Varachha Road, Surat - 395006 Vs. The CIT(Exemption), Ahmedabad èथायीलेखासं./जीआइआरसं./PAN/GIR No.: ABDTS8099R (Appellant) (Respondent) Appellant by Shri Rasesh Shah, CA Respondent by Shri Ashish Pophare, CIT(DR) Date of Hearing 06/03/2025 Date of Pronouncement 30/04/2025 आदेश / O R D E R PER BIJAYANANDA PRUSETH, AM: These three appeals emanate from the separate orders dated 06.11.2024 and 20.08.2024 passed by the Commissioner of Income-tax (Exemption), Ahmedabad [in short “the CIT(E)”]. ITA No.1306/SRT/2024 is against rejection of application for registration u/s 12A of the Income-tax Act, 1961 (in short, ‘the Act’) whereas in ITA Nos.1308/SRT/2024 and 1307/SRT/2024, the appellant has agitated against rejection of its application for final/regular registration u/s 80G(5) of the Act. 2. The appeals filed by the assessee in ITA No.1307/SRT/2024 is barred by 56 days in terms of provisions of section 253(3) of the Act. The assessee 2 ITA Nos.1306 to1308/SRT/2024 Shardaben Arjanbhai Dholakiya has filed an affidavit for delay in filing of appeal before the Tribunal. In the affidavit, it has been stated that the CIT(E) rejected approval u/s 80G(5) on the ground that application for registration u/s 12A(1)(ac)(vi) was rejected vide order dated 14.08.2024. Initially, assessee decided not to file appeal against the order dated 14.08.2024 and filed fresh application for registration u/s 12A(1)(ac)(iii) of the Act as it was provisionally registered till AY.2025-26. Accordingly, it filed fresh application on 29.06.2024, which was also rejected because it was not provisionally registered u/s 12A(1)(ac)(iii) of the Act. Consequently, the application for approval u/s 80G(5) of the Act was also rejected. Therefore, appellant filed simultaneous appeals against the orders rejecting application for registration u/s 12A and u/s 80G(5) of the Act. In view of the facts, it was submitted that the delay in filing appeal was not intentional and assessee was prevented by sufficient and reasonable cause for not filing the appeal in time. 3. The learned Commissioner of Income-tax - Departmental Representative (ld. CIT-DR) for the revenue submitted that the Bench may decide the application as deemed proper. 4. We have considered the reasons given by the ld. AR and perused the accompanied documents along with the affidavit. We find that the delay in filing the appeal was not deliberate and intentional on the part of assessee. Moreover, the assessee is not going to be benefitted by filling appeal belatedly. It is now fairly settled that when technical consideration and cause 3 ITA Nos.1306 to1308/SRT/2024 Shardaben Arjanbhai Dholakiya of substantial justice are pitted against each other, the cause of substantial justice may be preferred. Hence, delay in filling the appeal is condoned and we proceed to decide the case on merit. 5. The grounds of appeal raised by the assessee in ITA No.1306/SRT/2024 are as follows: “1. On the facts and circumstances of the case as well as law on the subject, the learned Commissioner of Income Tax has erred in rejecting the application of assessee for registration u/s 12AB of the Act. 2. It is therefore prayed that registration u/s 12AB may please be allowed. 3. Appellant craves leave to add, alter or delete any ground(s) either before of in the course of the hearing of the appeal.” 6. The grounds of appeal raised by the assessee in ITA No.1307/SRT/2024 are as follows: “1. On the facts and circumstances of the case as well as law on the subject, the learned Commissioner of Income Tax (Exemption), Ahmedabad has erred in rejecting assessee’s application in Form No.10Ab for registration u/s 80G(5)(iii) on the ground that assessee’s application for registration u/s. 12AB was rejected. Assessee submits that the assessee has filed for separate appeal against the refusal of registration u/s 12AB by Ld. CIT(Exemption). 2. It is therefore prayed that order of CIT(Exemption), passed u/s 80G(5) of the I.T. Act, 1961 may please be set aside to the file of CIT(Exemption) with appropriate direction. 3. Appellant craves leave to add, alter or delete any ground(s) either before of in the course of the hearing of the appeal.” 7. The grounds of appeal raised by the assessee in ITA No.1307/SRT/2024 are as follows: “1. On the facts and circumstances of the case as well as law on the subject, the learned Commissioner of Income Tax has erred in rejecting the application of assessee for approval u/s 80G(5) of the Act. 4 ITA Nos.1306 to1308/SRT/2024 Shardaben Arjanbhai Dholakiya 2. It is therefore prayed that approval u/s 80G(5) may please be allowed. 3. Appellant craves leave to add, alter or delete any ground(s) either before or in the course of hearing of the appeal.” ITA No.1306/SRT/2024: 8. The assessee filed application for registration of the trust under sub- clause (iii) of clause (ac) of sub-section (1) of section 12A in Form No.10AB of the Act. The CIT(E) issued notice on 23.08.2024 and in absence of various details, he rejected the application of the assessee as premature and non- maintainable. He stated that the assessee was not provisionally registered u/s 12AB of the Act. 9. Aggrieved by the order of CIT(E), the assessee filed appeal before the Tribunal. The learned Authorized Representative (ld. AR) submitted that the action of the CIT(E) is not correct as assessee filed Form No.10A earlier on the wrong code i.e., ‘10’ instead of ‘01’. This was a bonafide mistake committed by the assessee through inadvertence. He submitted that Form No.10A is common for both section 10(23C) and 12AB of the Act and, hence, all details were filed correctly for obtaining provisional approval u/s 12AB of the Act. The CIT(E) failed to point out any deficiency in details filed for obtaining provisional registration. He placed reliance on the decisions in cases of Mandava Foundation vs. CIT(E), ITA No.47/Hyd/2024 (Hyderabad – Trib.), Parmeshwari Bai Memorial Trust vs. CIT(E), 161 taxmann.com 311 (Orissa) and Rambha Charitable Trust vs. CIT(E), ITA No.5111/Mum/2024 (Mumbai – 5 ITA Nos.1306 to1308/SRT/2024 Shardaben Arjanbhai Dholakiya Trib.). He submitted that the application for registration may be restored to the file of CIT(E). 10. On the other hand, the learned Commissioner of Income-tax - Departmental Representative (ld. CIT-DR) for the revenue supported the order of CIT(E). 11. We have heard both parties and perused the materials available on record. We have also deliberated on the decisions relied upon by the ld. AR. We find that the CIT(E) has issued only one notice on 23.08.2024 and proceeded to decide the appeal on the basis of the details available on record. The ld. AR submitted that all details are available with the appellant. Considering the above facts, we are of the view that the principle of natural justice has not been adhered to the instant case. It is settled law that principle of natural justice requires that the affected party is granted sufficient opportunity of being heard to present his case. Therefore, without delving deeper into the merits of the case, in the interest of justice, we restore the matter back to the file of CIT(E) for de novo adjudication and pass a speaking order after affording sufficient opportunity of being heard to the assessee. The assessee is directed to furnish its submission and relevant details/documents before the CIT(E). For statistical purposes, the appeal of the assessee is treated as allowed. 12. In the result, appeal filed by the assessee is allowed for statistical purposes. 6 ITA Nos.1306 to1308/SRT/2024 Shardaben Arjanbhai Dholakiya ITA Nos.1307 & 1308/SRT/2024: 13. In both these appeals, the CIT(E) has issued only one notice of hearing, i.e., on 11.06.2024 and 12.09.2024 respectively and proceeded to dismiss the appeals. Hence, following the reasons given in ITA No. 1306/SRT/2024 (supra), the orders of CIT(E) are set aside and remitted to the file of CIT(E) for fresh adjudication after granting reasonable and sufficient opportunity of being heard to the appellant. For statistical purposes, the appeals of the assessee are treated as allowed. 14. In the result, appeals of the assessee are allowed for statistical purposes. 15. In the combined result, appeals filed by the assessee are allowed for statistical purposes. Order is pronounced under provision of Rule 34 of ITAT Rules, 1963 on 30/04/2025. Sd/- Sd/- (SUCHITRA R. KAMBLE) (BIJAYANANDA PRUSETH) JUDICIAL MEMBER ACCOUNTANT MEMBER Surat Ǒदनांक/ Date: 30/04/2025 SAMANTA Copy of the Order forwarded to: 1. The Assessee 2. The Respondent 3. The CIT(A) 4. CIT 5. DR/AR, ITAT, Surat 6. Guard File By Order // TRUE COPY // Assistant Registrar/Sr. PS/PS ITAT, Surat "