SREE SRINIVASA TRUST,BHIMAVARAM V. INCOME TAX OFFICER (EXEMPTION WARD), RAJAHMUNDRY

ITA 107/VIZ/2025

AI Insights

The case involves Sree Srinivasa Trust appealing against the rejection of their application for registration under section 12AB of the Income Tax Act, 1961 by the Learned Commissioner of Income Tax (Exemption), Hyderabad. The primary contention was that the CIT(E) did not provide a speaking order for the denial of registration, and the assessee argued that they had provided substantial documentary evidence showing their charitable activities, which was allegedly overlooked by the CIT(E). The Tribunal found that the CIT(E) had not adequately discussed the reasons for rejection and thus decided to remand the case back for a detailed examination.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 669395 (ITAT-VISAKHAPATNAM)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-06-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Principle of natural justice

Judgement Text

"आयकर अपीलीय अधिकरण, धिशाखापटणम पीठ, धिशाखापटणम IN THE INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM “DIVISION” BENCH, VISAKHAPATNAM (HYBRID HEARING) श्री रिीश सूद ,न्याधयक सदस्य एिं श्री एस बालाक ृष्णन, लेखा सदस्य क े समक्ष BEFORE SHRI RAVISH SOOD, HON’BLE JUDICIAL MEMBER & SHRI S BALAKRISHNAN, HON’BLE ACCOUNTANT MEMBER आयकर अपीलसं./I.T.A.No.107/VIZ/2025 Sree Srinivasa Trust #401, Sivaraopeta Bhimavaram – 534202 Andhra Pradesh [PAN: ABGTS5066H] v. Income Tax Officer (Exemption Ward) Income Tax Office, Aayakar Bhavan Kambala Cheruvu, Veerabhadrapuram Rajahmundry – 533105 Andhra Pradesh (अपीलार्थी/ Appellant) (प्रत्यर्थी/ Respondent) करदाता का प्रतततितित्व/ Assessee Represented by : Shri GVN Hari, Advocate राजस्व का प्रतततितित्व/ Department Represented by : Dr. Satyasai Rath, CIT(DR) सुिवाई समाप्त होिे की ततति/ Date of Conclusion of Hearing : 24.06.2025 घोषणा की तारीख / Date of Pronouncement : 27.06.2025 आदेश /O R D E R PER SHRI S BALAKRISHNAN, ACCOUNTANT MEMBER: 1. This appeal is filed by the assessee against rejection order of Learned Commissioner of Income Tax (Exemption), Hyderabad [hereinafter in short “Ld.CIT(E)”] vide DIN & Notice No. ITBA/EXM/F/EXM45/2024- I.T.A.No.107/VIZ/2025 Sree Srinivasa Trust Page. No 2 25/1070993860(1) dated 07.12.2024 seeking registration under section 12AB of the Income Tax Act, 1961 (in short ‘Act’). 2. Briefly stated facts of the case are that the assessee has filed an e-application in Form No.10AB seeking registration under section 12AB of the Act. The Ld.CIT(E) issued notices to the assessee in respect of proceedings under section 12A(1)(ac)(vi) of the Act to produce the copy of Memorandum of Association/Trust Deed for verification and to furnish a detailed reply on the specific information called for in the said notice. In response, assessee has submitted some of the details as called for. Subsequently, another notice dated 28.10.2024 was issued to the assessee to submit the full information as per the notices issued. In response, assessee furnished its reply in compliance to the notice issued by the Ld.CIT(E). On a perusal of the submissions of the assessee, Ld.CIT(E) rejected the application filed in Form-10AB for registration under section 12AB of the Act. 3. Aggrieved by the rejection order, assessee filed an appeal before us and raised following grounds in its appeal: -. “1. The order of the learned Commissioner of Income Tax (Exemption), Hyderabad is contrary to the facts and also the law applicable to the facts of the case. 2. The learned Commissioner of Income Tax (Exemption), Hyderabad is not justified in rejecting the application filed by the appellant for registration u/s 12AB of the Act. 3. Any other ground that may be urged at the time of appeal hearing.” I.T.A.No.107/VIZ/2025 Sree Srinivasa Trust Page. No 3 4. The only issue contested by the assessee is with respect to rejection of the Registration under section 12AB of the Act by the Ld.CIT(E). 5. At the outset, Ld. Authorized Representative (hereinafter in short “Ld.AR”] submitted that Ld. CIT(E) has not passed a speaking order for the denial of registration to the assessee. He further submitted that various documentary evidences have been provided before Ld. CIT(E) but he has casually observed the no substantial activities which are charitable in nature are being carried out by the assessee. He therefore pleaded that one more opportunity may be provided to the assessee to submit its reply with documentary evidences once again to the Ld.CIT(E). 6. On the other hand, Ld. Departmental Representative [hereinafter in short “Ld. DR”] heavily relied on the order of the Ld. CIT(E). 7. We have heard both the sides and perused the material available on record. The assessee responded to the notices issued by the Ld.CIT(E) but it is observed from the order of the Ld.CIT(E) that the assessee has partly responded. We find that Ld. CIT(E) while rejecting the application in Form10AB for the purpose of Registration of the society under section 12AB of the Act has observed as follows: - “3. On perusal of the submissions made by the assessee, it is observed that no substantial activities which are charitable in nature are being carried out by the assessee, which is in violation of the provisions of the I.T.A.No.107/VIZ/2025 Sree Srinivasa Trust Page. No 4 section 12AB of the IT Act, 1961. In view of the above, the present application in form 10AB for registration u/s. 12AB is herewith rejected.” 8. On a perusal of the Ld. CIT(E) order, we find that he has not discussed anything except stating that the no substantial activities which are charitable in nature are being carried out by the assessee. Ld. CIT(A) has not specified how the assessee’s activities cannot be deciphered as charitable in nature. Ld.CIT(E) has simply rejected the assessee’s application which, in our considered opinion is not correct. Therefore, in the interest of natural justice, we find it appropriate to grant another one more opportunity to the assessee to submit the relevant documents including the evidences as detailed in the notices. Accordingly, we grant one more opportunity to the assessee and thereby set-aside the impugned order and restore the matter back to the file of Ld.CIT(E) with a direction to provide one more opportunity to the assessee to furnish required details and to decide the case on merits by passing a speaking order. Assessee is also directed to fully cooperate and furnish necessary documents / information as required by the Ld.CIT(E). 9. In the result, appeal of the assessee is allowed for statistical purposes. Order pronounced in the open court on 27th June, 2025. Sd/- (रिीश सूद) (RAVISH SOOD) न्याधयक सदस्य/JUDICIAL MEMBER Sd/- (एसबालाक ृष्णन) (S. BALAKRISHNAN) लेखासदस्य/ACCOUNTANT MEMBER Dated:27.06.2025 Giridhar, Sr.PS I.T.A.No.107/VIZ/2025 Sree Srinivasa Trust Page. No 5 आदेशकी प्रतत तलतप अग्रेतषत/ Copy of the order forwarded to:- 1. तिर्ााररती/ The Assessee : Sree Srinivasa Trust #401, Sivaraopeta Bhimavaram – 534202 Andhra Pradesh 2. राजस्व/ The Revenue : Income Tax Officer (Exemption Ward) Income Tax Office, Aayakar Bhavan Kambala Cheruvu, Veerabhadrapuram Rajahmundry – 533105 Andhra Pradesh 3. The Principal Commissioner of Income Tax 4. तिभागीयप्रतततितर्, आयकरअपीलीयअतर्करण, तिशाखापटणम /DR,ITAT, Visakhapatnam 5. The Commissioner of Income Tax 6. गार्ाफ़ाईल / Guard file आदेशािुसार / BY ORDER Sr. Private Secretary ITAT, Visakhapatnam "