THAKKAR VELSHIBHAI MAGANLAL CHARITABLE TRUST,AHMEDABAD V. THE CIT(EXEMPTION), AHMEDABAD

ITA 54/AHD/2025

AI Insights

The case involves the Thakkar Velshibhai Maganlal Charitable Trust, which appealed against the decisions of the Commissioner of Income Tax (Exemption), Ahmedabad, rejecting their applications for registration under Section 12AB and approval under Section 80G(5) of the Income Tax Act, 1961. The Tribunal found that the rejections were primarily due to the assessee's non-compliance with procedural requirements, which was attributed to the consultant's lack of knowledge. The Tribunal decided to set aside the CIT(E)'s orders and remand the matter for fresh consideration, emphasizing the importance of procedural compliance and the substantive rights of the assessee under the Act.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 39184 (ITAT-AHMEDABAD)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-03-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R.N. DSOUZA
• Assessee Lawyers: VARIS ISANI
• Keywords: Condonation of delay; Set aside; Opportunity of being heard; Principle of natural justice; Charitable institution
• Section: 80G

Judgement Text

" आयकर अपीलीय अिधकरण, अहमदा बा द \u0012ा यपीठ “ए“, अहमदा बा द । IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, AHMEDABAD सु\u0018ी सुिच\u001aा का \u001bले, \u0012ा ियक सद\u001d एवं \u0018ी मकरंद वसंत महा देवकर, लेखा सद\u001d क े सम\"। ] ] BEFORE MS. SUCHITRA KAMBLE, JUDICIAL MEMBER & SHRI MAKARAND V. MAHADEOKAR, ACCOUNTANT MEMBER आयकर अपील सं /ITA Nos.53/Ahd/2025 & 54/Ahd/2025 िनधा \u0010रण वष\u0010 /Assessment Year : - Thakkar Velshibhai Maganlal Charitable Trust C/322,Kumbhnath Society Nr.Ghodasar Police Chowki Maninagar Ahmedabad – 380 008 बनाम/ v/s. The CIT(Exemption) Ahmedabad – 380 015 \u0014थायी लेखा सं./PAN: AAATT 5156 E अपीलाथ%/ (Appellant) &' यथ%/ (Respondent) Assessee by : Shri Varis Isani, Advocate Revenue by : Shri R.N. Dsouza, CIT-DR सुनवाई की तारीख/Date of Hearing : 17 /03/2025 घोषणा की तारीख /Date of Pronouncement: 18 /03/2025 आदेश/O R D E R PER MAKARAND V. MAHADEOKAR, AM: Both these appeals have been filed by the assessee challenging the order passed by the Commissioner of Income Tax (Exemption), Ahmedabad [hereinafter referred to as “CIT(E)”] rejecting the assessee’s application for registration under Section 12AB of the Income Tax Act, 1961 [hereinafter referred to as “the Act”] and approval under Section 80G(5) of the Act. The impugned orders were passed on 04/03/2023 (for 12AB of the Act) and ITA Nos.53 & 54/Ahd/2025 Thakkar Velshibhai Maganlal Charitable Trust vs. CIT (E) 2 05/03/2023 (for 80G of the Act). Since the approval under Section 80G of the Act is consequential to the grant of 12AB of the Act registration, both the appeals were heard together and are being disposed of by this common order. Facts of the Case: 2. The assessee had been granted provisional registration under Section 12AB of the Act and provisional approval u/s. 80G of the Act. The assessee subsequently filed applications in Form No. 10AB under Rule 17A of Income Tax Rules, 1962 for registration under Section 12AB of the Act and under Rule 11AA of Income Tax Rules, 1962 for approval under Section 80G(5) of the Act electronically on 30/09/2022. The CIT(E), Ahmedabad, issued notices on 06/12/2022 & 28/12/2022 (for 12AB of the Act), and 12/12/2022 & 04/01/2023 (for 80G of the Act), requesting further details/documents. Since no response was filed by the assessee, the applications were rejected. 3. Aggrieved by the orders of the CIT(E), the assessee filed appeals before us with following common grounds of appeal(s): 1. The Ld. Commissioner of Income Tax (Exemption), Ahmedabad, has grievously erred in law while passing the order for rejection of application of the appellant filed in Form 10AB for the registration u/s.12AB of the Income Tax Act. The impugned order is opened to facts and law in so far it is prejudicial to the interest of the appellant. 2. The Ld. CIT (Exemption)has erred in rejecting application in Form 10AB for the registration u/s. 12AB of the Income Tax Act for the reason which are arbitrary, impermissible and beyond what is provided under law. ITA Nos.53 & 54/Ahd/2025 Thakkar Velshibhai Maganlal Charitable Trust vs. CIT (E) 3 3. The Ld. CIT (Exemption) failed to appreciate the fact that application u/s. 12AB of the Income Tax Act can be denied only under the circumstances given in Rule 17A of the Income Tax Rules. 4. The Ld. CIT (Exemption) failed to appreciate that objects of the appellant are in confirmative with the provisions of section 12AB of the Income Tax Act making it eligible for recognition. 5. The Ld. CIT (Exemption)has rejected the application of the appellant Trust only on the ground of mismatch of the name as per PAN and as per Trust Deed without verifying the amendment in the name of the appellant Trust. 6. The appellant craves leave to add, alter or amend any of the grounds of appeal either before or at the time of hearing of the appeal. Prayer: It is therefore prayed that, 1. That Hon'ble ITAT may be pleased to set aside the order of CIT(Exemption) and grant registration / recognition u/s. 12AB of the Income Tax Act. 2. Delay caused in filing the appeal may please be condoned in the interest of justice. Delay condonation application is filed separately. 3. The Hon'ble CIT (Exemption) may please be directed to grant registration/ recognition u/s. 12AB of the Income Tax Act. 4. Any other relief which may deemed fit and proper may please be given. 4. During the course of the hearing before us, the Authorized Representative (AR) submitted that the consultant handling the registration process was unaware of the procedural requirements, leading to the non- compliance and consequential rejection of the applications. The AR requested that the order be set aside, and the matter be restored back to the CIT(E) for fresh adjudication. The Departmental Representative (DR), considering the facts and circumstances, left the issue to the Bench to decide in the interest of justice. ITA Nos.53 & 54/Ahd/2025 Thakkar Velshibhai Maganlal Charitable Trust vs. CIT (E) 4 5. We have heard both the parties and perused the records. It is evident that the assessee’s non-compliance was due to an inadvertent procedural lapse rather than any deliberate non-cooperation. Considering that the substantive rights of the assessee under Sections 12AB and 80G (5) of the Act are involved, we are of the view that one more opportunity should be granted to the assessee to present its case before the CIT(E). 5.1. The delay of 587 days in filing the present appeals has been pointed out by the Registry. The assessee has filed a condonation of delay application citing genuine reasons for the delay, including lack of procedural knowledge by the consultant and subsequent rectification through legal advice. Considering the principle of natural justice, we deem it appropriate to condone the delay in filing the appeals. 5.2. However, since the assessee has failed to respond to multiple notices issued by the CIT(E) and caused an unnecessary delay in the proceedings, we deem it fit to impose a cost of Rs.5,000/- per appeal on the assessee, payable to the Income Tax Department. 5.3. In view of the above, we set aside the orders of the CIT(E) and restore the matter back to his file for fresh adjudication after granting the assessee due opportunity of being heard. The assessee is directed to comply with all notices issued by the CIT(E) and furnish the requisite details within the stipulated time. ITA Nos.53 & 54/Ahd/2025 Thakkar Velshibhai Maganlal Charitable Trust vs. CIT (E) 5 6. In the combined result, both the appeals of the assessee are allowed for statistical purposes, subject to the payment of Rs.5,000/- per appeal by the assessee. Order pronounced in the Open Court on 18th March, 2025 at Ahmedabad. Sd/- Sd/- (SUCHITRA KAMBLE) JUDICIAL MEMBER (MAKARAND V. MAHADEOKAR) ACCOUNTANT MEMBER अहमदाबाद/Ahmedabad, िदनांक/Dated 18/03/2025 टी.सी.नायर, व.िन.स./T.C. NAIR, Sr. PS आदेश की #ितिलिप अ$ेिषत/Copy of the Order forwarded to : 1. अपीलाथ% / The Appellant 2. #&थ% / The Respondent. 3. संबंिधत आयकर आयु' / Concerned CIT 4. आयकर आयु' ) अपील ( / The CIT(E)-Ahmedabad 5. िवभागीय #ितिनिध , आयकर अपीलीय अिधकरण , राजोकट/DR,ITAT, Ahmedabad, 6. गाड\u0010 फाईल / Guard file. आदेशानुसार/ BY ORDER, स&ािपत #ित //True Copy// सहायक पंजीकार (Asstt. Registrar) आयकर अपीलीय अिधकरण, ITAT, Ahmedabad 1. Date of dictation (word processed by Hon’ble AM in his laptop) : 17.3.2025 2. Date on which the typed draft is placed before the Dictating Member. : 17.3.2025 3. Date on which the approved draft comes to the Sr.P.S./P.S : 4. Date on which the fair order is placed before the Dictating Member for pronouncement. : 5. Date on which fair order placed before Other Member : 6. Date on which the fair order comes back to the Sr.P.S./P.S. : 19.3.25 7. Date on which the file goes to the Bench Clerk. : 19.3.25 8. Date on which the file goes to the Head Clerk. : 9. The date on which the file goes to the Assistant Registrar for signature on the order. : 10. Date of Despatch of the Order : "