TRENDSET SUMANJALI WELFARE ASSOCIATION,HYDERABAD V. CIT (EXEMPTION) , HYDERABAD

ITA 935/HYD/2025

AI Insights

The case involves the Trendset Sumanjali Welfare Association, which appealed against the decision of the Commissioner of Income Tax (Exemptions), Hyderabad, rejecting their application for registration under section 12AB of the Income Tax Act, 1961. The rejection was initially based on the grounds that the association was not carrying out substantial charitable activities. The association contended that they were not aware of the rejection order until their Chartered Accountant discovered it on the ITBA Portal while filing the income return. The Tribunal found that the order was not properly communicated to the association, leading to a delay in filing the appeal, which was subsequently condoned. The Tribunal criticized the vague reasoning of the Commissioner for rejection and remanded the case for a detailed examination of the association's activities.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 787401 (ITAT-HYDERABAD)
• Duration Of Justice: 5 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-11-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB-A
• Assessment Year: misc
• Appeal Filed On: 29-05-2025
• Other Referred Cases: Collector, Land Acquisition Vs. MST.Katiji and Others (1987) 167 ITR 471, Concord of India Insurance Co. Ltd., Vs Smt. Nirmala Devi and Others 118 ITR 507
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PAVAN KUMAR BEER LA
• Assessee Lawyers: PAWAN KUMAR C HAKRAPANI
• Keywords: Condonation of delay; Opportunity of being heard; Period of limitation
• Section: 12A

Judgement Text

"आयकर अपीलȣय अͬधकरण, हैदराबाद पीठ IN THE INCOME TAX APPELLATE TRIBUNAL Hyderabad ‘A’ Bench, Hyderabad Įी ͪवजय पाल राव, उपाÚ य¢ एवं Įी मधुसूदन सावͫडया, लेखा सदè य क े सम¢ । BEFORE SHRI VIJAY PAL RAO, VICE PRESIDENT AND SHRI MADHUSUDAN SAWDIA, ACCOUNTANT MEMBER आ.अपी.सं /ITA No.935/Hyd/2025 [U/sec.12AB of the Income Tax Act, 1961] Trendset Sumanjali Welfare Association, Hyderabad – 500 034. PAN AAIAT3303J vs. The Commissioner of Income Tax (Exemptions), Hyderabad – 500 004. Telangana. (Appellant) (Respondent) िनधाŊįरती Ȫारा /Assessee by: CA Pawan Kumar Chakrapani राज̾ व Ȫारा /Revenue by: Sri Pavan Kumar Beerla, CIT-DR सुनवाई की तारीख/Date of hearing: 12.11.2025 घोषणा की तारीख/Pronouncement: 19.11.2025 आदेश/ORDER PER VIJAY PAL RAO, VICE PRESIDENT : This appeal by the Assessee is directed against the order dated 16.12.2024 of learned Commissioner of Income Tax-(Exemptions), Hyderabad, whereby the application of the assessee in Form-10AB seeking regular registration u/sec.12AB was rejected. Printed from counselvise.com 2 ITA.No.935/Hyd./2025 2. There is a delay of 90 days in filing the present appeal. The assessee has filed an application for condonation of delay which is supported by the Affidavit of the General Secretary of the assessee. The learned Authorised Representative of the Assessee has submitted that the impugned order passed by the learned CIT(E) was not served on the assessee either physically or through email. Therefore, the assessee was not aware about the impugned order till the Chartered Accountant of the assessee while filing the return of income of the assessee found on the Portal that the learned CIT(E) passed the impugned order dated 16.12.2024 and rejected the application of the assessee for registration under section 12AB of Income Tax Act. Thus, the learned Authorised Representative of the Assessee has contended that the assessee / appellant did not receive the impugned order either physically or through mail and, therefore, the same was not in the knowledge of the assessee trust till it was noticed by the Chartered Accountant who accordingly informed the members of the assessee trust. Therefore, the delay Printed from counselvise.com 3 ITA.No.935/Hyd./2025 of 90 days in filing the present appeal is neither intentional nor deliberate, but, due to the reasons that the impugned order was not communicated to the assessee. He has prayed that the delay of 90 days in filing the appeal may be condoned and the appeal of the assessee be admitted for adjudication on merits. 3. On the other hand, the learned DR for the Revenue has submitted that the order was duly uploaded on the ITBA Portal which amounts to service of the Order to the assessee. 4. We have considered the rival submissions as well as relevant material on record. The assessee has explained the delay of 90 days in filing the present appeal in Paras-4 to 10 of the application for condonation of delay as under : “4. The appellant being aggrieved by the rejection of application vide order dated 16/12/2024 is preferring an appeal before the Hon'ble Income Tax Appellate Tribunal, Hyderabad for redressal of various grievances being raised. The appellant is making this petition for condonation of delay in filing the said appeal due to reasons beyond the appellant's control and knowledge of the proceedings being conducted under 12AB of the Act. Printed from counselvise.com 4 ITA.No.935/Hyd./2025 5. The Chartered Accountant who files the return of income of the trust, found on the portal that the appellate order rejecting the application for registration of trust under section 12AB of the Act, dated 16/12/2024 was passed by the Honourable Commissioner of Income-tax (Exemptions), Hyderabad. The appellate order was not received through mail nor was brought to the notice of the members of the Trust. It was only by the Chartered Accountant the members of the trust were informed that the order of rejection was passed by the Honourable Commissioner. 6. On receipt of information the Appellant contacted, the present counsel to seek advice of further course of action. The current counsel after perusing the document suggested that an appeal should be preferred before the Honourable Tribunal against the order of rejection passed by the Honourable Commissioner. 7. Soon after obtaining the professional advice from the present counsel the Appellant within a reasonable time has filed this present appeal before this Honourable Tribunal. 8. It is submitted that due to the above-mentioned reasons the Appellant could not file the Appeal before this Hon'ble Tribunal well in time 1.e. on or before 28/02/2025 and by the time the Appellant sought the present counsel's advice, there arose 90 days delay in filing the appeal before this Hon'ble Tribunal. 9. It is humbly prayed that this Hon'ble Tribunal takes a lenient and compassionate view and condones the delay of 90 days in filing the Appeal before this Hon'ble Tribunal and hears the same on merits for the advancement of substantial cause of justice. 10. It is submitted that if this application for condonation of delay in filing the Appeal is not allowed, the Appellant would be put to Printed from counselvise.com 5 ITA.No.935/Hyd./2025 great hardship and irreparable injury and on the other hand no hardship or injury would be caused to the Respondent if this application of Condonation of delay is allowed. Reliance is placed on the decision of the Hon'ble Apex Court in the case of Collector, Land Acquisition Vs. MST.Katiji and Others (1987) 167 ITR 471 and also in the case of Concord of India Insurance Co. Ltd., Vs Smt. Nirmala Devi and Others 118 ITR 507.” 5. The Department has not disputed this fact as explained by the assessee that the impugned order was not served on the assessee either physically or through email and, therefore, we are satisfied that the assessee was having a ‘sufficient reason’ for not filing the appeal within the period of limitation. It is pertinent to note that the service of the Order was required to be effected on the assessee through the mode as prescribed u/sec.282 of the Income Tax Act, 1961 read with Rule 127 of I.T. Rules, 1962. Once, the Order was not served on the assessee through any of the modes as provided under the Act as well as Rules, then, it is a clear case of lack of knowledge of the impugned order till the Chartered Accountant of the Assessee noticed it from the ITBA Portal while filing the return of income. Printed from counselvise.com 6 ITA.No.935/Hyd./2025 Accordingly, we condone the delay of 90 days in filing the present appeal. 6. The assessee has raised the following grounds : 1. “The order of rejection for approval under section 12AB of the Act, passed by the learned Principal Commissioner of Income-tax [Exemption], Hyderabad, dated 16/12/2024, in so far as it is against the Appellant is opposed to law, equity, weight of evidence, probabilities and the facts and circumstances in the Appellant's case. 2. Whether the learned Principal Commissioner of Income-tax (Exemptions), Hyderabad, is justified in mechanically rejecting the application filed by the Appellant for registration of the Appellant Welfare Association under section 12AB of the Act, under the facts and circumstances of the case. 3. Whether the learned Principal Commissioner of Income-tax (Exemptions), Hyderabad, is justified in mechanically rejecting the application filed by the Appellant Trust under section 12AB stating that no substantial charitable activities are being carried out, under the facts and circumstances of the case. 4. The Appellant craves leave of this Honorable Tribunal to add, alter, delete or substitute any or all of the grounds urged above, at the time of hearing of the appeal by this Honorable Tribunal. 5. In the view of the above and other grounds that may be urged at the time of the hearing of the appeal, the Appellant prays that the appeal may be allowed in the interest of justice and equity.” Printed from counselvise.com 7 ITA.No.935/Hyd./2025 7. The learned Authorised Representative of the Assessee has submitted that the learned CIT(E) has rejected the application without giving the reasons as to how the activities of the assessee are not charitable in nature. He has pointed-out that in para-3 of the impugned order, the learned CIT(E) has given only one reason that “no substantial activity which are charitable in nature are being carried-out by the assessee”, whereas, the assessee has filed all the requisite details and documents to show that the assessee has carried-out charitable activities, but, the same were not considered by the learned CIT(E) while passing the impugned order. Thus, he has pleaded that the impugned order of the learned CIT(E) be set-aside and the matter be remanded to the record of the learned CIT(E) for re-consideration of the application of the assessee for registration u/sec.12AB of the Act after proper verification and examination of the relevant record in support of the fact that the assessee has carried-out charitable activities. Printed from counselvise.com 8 ITA.No.935/Hyd./2025 8. On the other hand, the learned DR for the Revenue has submitted that the learned CIT(E) has given a finding that no substantial activities which are charitable are being carried-out by the assessee. He has relied upon the impugned order of the learned CIT(E). 9. We have considered the rival submissions and carefully perused the impugned order of the learned CIT(E). In Para-3 of the impugned order the reasons given for rejecting the application, which reads as under : “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 section 12A of the IT Act, 1961. In view of the above, the present application in form 10AB for registration u/s 12A is herewith rejected.” 10. It is apparent from these reasons that a very vague and cryptic reasons are given by the learned CIT(E) for rejection of the application. The learned CIT(E) has not disputed that the assessee has filed the submissions and records, but, there is no whisper about any of the record filed by the assessee and how the activities of the assessee Printed from counselvise.com 9 ITA.No.935/Hyd./2025 are not charitable in nature. Therefore, the rejection of the application without considering the relevant record and fact and by a non-speaking order is highly arbitrary and unjustified. Accordingly, in the facts and circumstances of the case, the impugned order of the learned CIT(E) is set- aside and the matter is remanded to the record of the learned CIT(E) for registration of the application of the assessee for registration u/sec.12AB of the Act, after considering relevant record and details to be filed by the assessee as well as giving an opportunity of being heard to the assessee. 11. In the result, appeal of the Assessee is allowed for statistical purposes. Order pronounced in the open Court on 19.11.2025. Sd/- Sd/- [MADHUSUDAN SAWDIA] [VIJAY PAL RAO] ACCOUNTANT MEMBER VICE PRESIDENT Hyderabad, Dated 19th November, 2025 VBP Printed from counselvise.com 10 ITA.No.935/Hyd./2025 Copy to : 1. Trendset Sumanjali Welfare Association, 101 Block C1, 8-2-393B, Trendset Sumanjali, Road No.5, Banjara Hills, Hyderabad – 500 034. 2. The Commissioner of Income Tax (Exemptions), 2nd Floor, Aaykar Bhawan, Basheerbagh, Hyderabad. PIN – 500 004. Telangana. 3. The. Addl. CIT (Exemptions), Hyderabad 4. The DR, ITAT, A-Bench, Hyderabad. 5. Guard file. BY ORDER, //True copy// Printed from counselvise.com "