SHRI BASANTILAL RATHI CHARITABLE TRUST,AHMEDABAD V. THE CIT(EXEMPTION), AHMEDABAD

ITA 1789/AHD/2024

AI Insights

The case involves the Shri Basantilal Rathi Charitable Trust appealing against the decision of the Commissioner of Income Tax (Exemption), Ahmedabad, which rejected their application for registration under Section 12A of the Income Tax Act and cancelled their provisional registration. The trust argued that they were not given a reasonable opportunity to present their case, as they were unable to access the e-portal and thus unaware of the notices issued by the CIT(E). Both parties agreed that the matter should be reconsidered by the CIT(E).

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 473816 (ITAT-AHMEDABAD)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-02-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PRATHVI RAJ MEENA
• Assessee Lawyers: HEMANT SUTHAR
• Keywords: Opportunity of being heard; Charitable institution
• Section: 12A

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL “D” BENCH, AHMEDABAD BEFORE DR. BRR KUMAR, VICE PRESIDENT & SHRI SIDDHARTHA NAUTIYAL, JUDICIAL MEMBER I.T.A. No.1789/Ahd/2024 (Assessment Year: N.A.) Shri Basantilal Rathi Charitable Trust, 35, New Cloth Market, O/s. Raipur Gate, Ahmedabad-380002 Vs. Commissioner of Income Tax (Exemption), Ahmedabad [PAN No.AABTS0680B] (Appellant) .. (Respondent) Appellant by : Shri Hemant Suthar, A.R. Respondent by: Shri Prathvi Raj Meena, CIT DR Date of Hearing 17.02.2025 Date of Pronouncement 19.02.2025 O R D E R PER SIDDHARTHA NAUTIYAL - JUDICIAL MEMBER: This appeal has been filed by the Assessee against the order passed by the Ld. Commissioner of Income Tax (Exemptions), (in short “Ld. CIT(E)”), Ahmedabad vide order dated 29.08.2024. 2. The Assessee has taken the following grounds of appeal:- “1. The Ld. CIT (Exemption), Ahmedabad has erred in law and in facts in: (a) Rejecting the application for registration filed u/s. 12A(1)(ac)(iii) of the I.T. Act in Form 10AB by the Applicant-Trust for the reason that the appellant has failed to furnish required documentary evidences. (b) In cancelling the provisional registration granted u/s. 12A for the A.Y. 2021-22 to A.Y. 2023-24. The Ld. CIT (Exemption) ought to have afforded reasonable opportunity of being heard before rejecting the appellant’s said application and ought not to have cancelled the provisional registration granted. The application of the appellant may kindly be restored to the file of the Ld. CIT (Exemption) and he may please be directed to grant appellant the registration u/s. 12A as sought after affording reasonable opportunity of being heard. 2. Your appellant craves liberty to add, alter, amend, substitute or withdraw any of the ground(s) of appeal hereinabove contended.” ITA No. 1789/Ahd/2024 Shri Basantilal Rathi Charitable Trust vs. CIT(E) Asst.Year –N.A. - 2– 3. The brief facts of the case are that the assessee / applicant trust filed application for grant of registration under Section 12A of the Act in Form 10AB. Ld. CIT(E) issued notices to the assessee dated 11.06.2024 and 29.06.2024 asking for certain details / documents. The CIT(E) noted that the applicant trust has filed part details vide it’s response dated 05.07.2024. Accordingly, the Ld. CIT(E) rejected the application for grant of registration under Section 12A of the Act and also directed cancellation of provisional registration earlier granted to the applicant trust. While passing the order, Ld. CIT(E) made the following observations: “7. As discussed above, the applicant/assessee has failed to file documentary evidences to enable me to satisfy about: i. Genuineness of the activities of the trust or institution. ii. That the activities of trust or institution are in consonance with the objects of the trust or institution. iii. That other laws material for the purpose of achieving objects are complied with. 8. In view of the above, the present application filed in Form No.10AB u/s 12A(1)(ac)(iii) of the Act is rejected and also your provisional registration stands cancelled. 9. Further, the applicant should compute its tax liability under section 115TD of Income Tax Act, 1961 read with Rule 17CB of IT Rules and report the same in return of Income. It should also pay the tax so computed within timeline provided under section 115TD(5) of Income Tax Act,1961. In case applicant is filing appeal against this order u/s. 253 of IT Act 1961, proof of filing of appeal should be provided to AO to get benefit of extended time limit provided u/s. 115TD(5) of IT Act 1961.” 4. The assessee / applicant is in appeal before us against the aforesaid order passed by Ld. CIT(E). Before us, the Counsel for the assessee submitted that there was lack of opportunity granted to the assessee / applicant trust since only two notices of hearing were issued on very short intervals. The assessee for that period could not access the e-portal and accordingly, the assessee / applicant trust was not aware about the issuance of notices by Ld. CIT(E). Accordingly, the Counsel for the assessee submitted that the matter may be restored to the file of Ld. CIT(E) to ITA No. 1789/Ahd/2024 Shri Basantilal Rathi Charitable Trust vs. CIT(E) Asst.Year –N.A. - 3– decide the case of the assessee on merits, after giving due opportunity of hearing to the assessee. 5. In response, the D.R. also did not object to the matter being restored to the file of Ld. CIT(E) for de-novo consideration. 6. We have heard the rival contentions and perused the material on record. 7. Accordingly, looking into the above facts placed on record, in the interest of justice, the matter is restored to the file of Ld. CIT(E) for de- novo consideration, after giving due opportunity of hearing to the assessee. 8. In the result, the appeal of the assessee is allowed for statistical purposes. This Order pronounced in Open Court on 19/02/2025 Sd/- Sd/- (DR. BRR KUMAR) (SIDDHARTHA NAUTIYAL) VICE PRESIDENT JUDICIAL MEMBER Ahmedabad; Dated 19/02/2025 TANMAY, Sr. PS TRUE COPY आदेश की Ůितिलिप अŤेिषत/Copy of the Order forwarded to : 1. अपीलाथŎ / The Appellant 2. ŮȑथŎ / The Respondent. 3. संबंिधत आयकर आयुƅ / Concerned CIT 4. आयकर आयुƅ(अपील) / The CIT(A)- 5. िवभागीय Ůितिनिध, आयकर अपीलीय अिधकरण, अहमदाबाद / DR, ITAT, Ahmedabad 6. गाडŊ फाईल / Guard file. आदेशानुसार/ BY ORDER, उप/सहायक पंजीकार (Dy./Asstt.Registrar) आयकर अपीलीय अिधकरण, अहमदाबाद / ITAT, Ahmedabad "