WOMAN DEVELOPMENT FOUNDATION,PUNE V. CIT(EXEMPTION), PUNE, PUNE

ITA 385/PUN/2025

AI Insights

The case involves the Woman Development Foundation appealing against the decision of the CIT(E), Pune, which rejected their application for registration under section 80G(5) of the Income Tax Act, 1961. The CIT(E) had rejected the application on the grounds of non-submission of a regular approval order under section 80G(5)(vi) and other discrepancies. The assessee contended that the rejection was without following the principles of natural justice and that the necessary documents were already on record. The ITAT found merit in the assessee's arguments and decided to remand the case back to the CIT(E) for a fresh decision.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 312160 (ITAT-PUNE)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-04-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AJAY KUMAR KESHARI
• Assessee Lawyers: MAHAVIR JAIN
• Keywords: Set aside; Opportunity of being heard; Principle of natural justice; Charitable institution
• Section: 80G

Judgement Text

" आयकर अपीलीय अधिकरण “बी” न्यायपीठ पुणे में । IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH, PUNE BEFORE SHRI R.K. PANDA, VICE PRESIDENT AND MS. ASTHA CHANDRA, JUDICIAL MEMBER आयकर अपील सं. / ITA No.385/PUN/2025 Woman Development Foundation, Office No. 302, Plot No. 9, Yashada, Fortune Business Centre, Baner, Pune-411007 PAN : AACCW3288M Vs. CIT (Exemptions), Pune अपीलार्थी / Appellant प्रत्यर्थी / Respondent Assessee by : Shri Mahavir Jain Department by : Shri Ajay Kumar Keshari Date of hearing : 16-04-2025 Date of Pronouncement : 29-04-2025 आदेश / ORDER PER ASTHA CHANDRA, JM : The appeal filed by the assessee is directed against the order dated 22.01.2025 of the Ld. Commissioner of Income Tax (Exemption), Pune [“CIT(E)”] whereby he rejected the application of the assessee filed on 25.09.2024 before him in Form No. 10AB under clause (ii) of first proviso to sub-section (5) of section 80G of the Income Tax Act, 1961 (the “Act”). 2. The assessee has raised the following grounds of appeal :- “On facts and in law, 1] The order passed u/s. 80G(5) of the Act is bad in law, since it is passed without following the principle of natural justice. The order of rejection may therefore kindly be set aside. 2] The Ld. CIT erred in passing the ex-parte order without waiting for assessee to file the submission even when ample time was available with him to pass the order till 31.03.2025. 3] The Ld. CIT erred in completing the proceedings in hurried manner without appreciating the appellant could not file the submission in stipulated time as the consultant of the appellant was facing technical problem at his end in uploading the submission. 4] Without prejudice, the Ld. CIT ought to have appreciated that all documents were already furnished vide earlier submission filed on 05.12.2024 and that even the issue raised in show cause notice dated 2 ITA No.385/PUN/2025 08.01.2025 was duly clarified in the previous reply itself and therefore, the rejection order is unwarranted. 5] The Ld. CIT failed to appreciate that appellant has filed the application under clause (ii) of the first proviso to Sec. 80G(5) of the Act and that the appellant was already having a regular approval under clause (ii) of the first proviso to Sec. 80G(5) of the Act and thus, issue raised in the show cause notice was totally irrelevant. Therefore, the approval u/s. 80G(5) ought to have been granted to the appellant. 6] The Ld. CIT erred in not granting renewal of approval u/s. 80G(5) to the appellant even though appellant has satisfied all the terms & conditions prescribed under the Act. 7] The appellant craves leave to add, alter, amend or delete any of the above grounds of appeal.” 3. Briefly stated, the facts of the case are that on receipt of the assessee’s application for registration 80G of the Act along with annexures thereto, with a view to verify the genuineness of the activities of the assessee trust and fulfillment of conditions laid down in clauses (i) to (v) of section 80G(5) of the Act etc., the Ld. CIT(E) issued notice on 06.11.2024 through ITBA portal which was duly served on the assessee requesting the assessee to upload certain information/clarification such self-certified copy of order of regular approval under section 80G(5) in Form No. 10AC, date of such approval, date of expiry of such approval, proof of identity of main trustees / directors, year-wise list of donations received, note on activities carried out along with supporting credible evidence, details of religious objectives, details of expenses on religious objectives, details of income from profits and gains of business, details of provisions of trust deed / MoA for transfer or application of income for any purpose other than charitable purposes etc.. The information /details were called for under the provisions of sub-clause (a) of clause (ii) of second proviso to section 80G(5) of the Act to ascertain the overall nature of the activities of the assessee. The compliance was sought by 21.11.2024. The assessee was specifically informed that in the event of failure to comply by the due date i.e. 21.11.2024, the application of the assessee shall be liable to be rejected and the registration/approval shall also be liable to be cancelled. On verification of the details/documents filed by the assessee, the Ld. CIT(E) noticed few discrepancies which were communicated vide issue of another notice dated 08.01.2025 duly served on the assessee via email/e-portal, seeking compliance by 15.01.2025. The said discrepancies are reproduced below : \"On verification of records and details furnished by you, it is seen that you have not furnished the copy of regular approval under section 80G(5)(vi) of the Income Tax Act, 1961. You have filed application under clause (ii) of first 3 ITA No.385/PUN/2025 proviso to section 80G(5) of the Act. The provisions of said section are applicable to a trust or institution which is regularly approved under section 80G(5)(vi) of the Act. As per the provisions of Rule 11AA(2)(e) of the Income Tax Rules, 1962, the copy of existing order granting approval was required to be submitted along with the application itself. Therefore, the copy of order of regular approval under section 80G(5)(vi) of the Act in form No.10AC issued under the provisions of clause (i) or clause (iii) of first proviso to section 80G(5) of the Act was required to be submitted by you along with the application, itself. You were also specifically requested vide the notice dated 06/11/2024 to furnish copy of such approval. However, it is seen that the copy of such regular approval is neither submitted along with the application nor submitted during the present proceedings till date. The copy of order of approval available on record is a provisional approval under section 80G(5)(vi) of the Act and not a regular approval. Further, it is also seen from the records that you have not made any valid application for regular approval under section 80G(5)(vi) of the Act.\" 3.1 The assessee failed to respond to the above notice. The Ld. CIT(E) based on the material available on record, observed that “the assessee has not furnished the copy of regular approval in form No.10AC u/s 80G(5)(vi) read with clause (i) or clause (iii) of first proviso to sub-section (5) of section 80G of the Act but submitted a copy of provisional approval u/s 80G(5)(vi) read with clause (iv) of first proviso to sub-section (5) of section 80G of the Act. The present application is filed by the assessee under clause (ii) of first proviso to sub-section (5) of section 80G of the Act. The provisions of clause (ii) of first proviso to sub-section (5) of section 80G are related to application for renewal of regular approval of a trust or institution which is already having regular approval under section 80G(5)(vi) of the Act and the period of said registration is about to expire. The assessee was specifically requested vide the initial notice to furnish the copy of order of regular approval under section 80G(5)(vi) of the Act. Such copy is actually required to be furnished along with the application itself under the provisions of Rule 11AA(2)(e) of the Income Tax Rules, 1962. However, the assessee has neither submitted the same along with the application nor in response to the notice issued in this regard. Thus the assessee failed to furnish the same. The copy of order submitted by the assessee along with the present application is a copy of provisional approval under section 80G(5)(vi) read with clause (iv) of first proviso to sub-section (5) of section 80G of the Act and not a copy of regular approval under section 80G(5)(vi) read with clause (i) or clause (iii) of first proviso to sub-section (5) of section 80G of the Act. The non-submission of copy of order of regular approval under section 80G(5)(vi) of the Act establishes the fact that the prerequisite for application under clause (ii) of first proviso to sub- section (5) of section 80G of the Act is not fulfilled in this case. Therefore, prima-facie it appears that the application is not 4 ITA No.385/PUN/2025 maintainable.” The Ld. CIT(E), hence proceeded to pass the impugned order treating the application of the assessee as non-maintainable and rejected its application for statistical purposes without going into the merits of the case and drawing any adverse inference against the assessee. 4. Dissatisfied, the assessee is in appeal before the Tribunal and all the grounds of appeal relate thereto. 5. The Ld. AR submitted that there was no intentional non-compliance before the Ld. CIT(E). He submitted that the assessee could not file its submission to the second notice within the prescribed due date as the consultant of the assessee was facing technical problem at his end in uploading the submission. He further submitted that the documents/ details called upon by the Ld. CIT(E) vide issue of second notice dated 08.01.2025 were already available on record of the Ld. CIT(E) as these were submitted in the previous reply of the assessee. He also contended that the assessee has filed the application under clause (ii) of the first proviso to section 80G(5) of the Act and that the assessee was already having a regular approval under clause (ii) of the first proviso to section 80G(5) of the Act and thus, issue raised in the show cause notice was totally irrelevant. Therefore, the approval u/s 80G(5) ought to have been granted to the assessee. He urged that as can be seen from the order of the Ld. CIT(E), adequate opportunity of hearing was not granted to the assessee to present its case before him. He submitted that given an opportunity the assessee is in a position to explain and substantiate its case before the Ld. CIT(E) and submit all the requisite details/documentary evidence in support of its application and respond to discrepancies noticed by the Ld. CIT(E). He, therefore, prayed that the matter may be set aside to the file of the Ld. CIT(E) to adjudicate the same afresh after on merits affording one more opportunity of being heard to the assessee. 6. The Ld. DR conceded to the above proposition of the Ld. AR. 7. We have considered the rival submissions and perused the records. It is an admitted fact that due to non-compliance to the notice issued by the Ld. CIT(E) asking for certain details and non-submission of copy of order of regular approval u/s 80G(5)(vi) of the Act, he rejected the application for grant of registration as non-maintainable. It is the submission of the Ld. Counsel for the assessee before us that given an 5 ITA No.385/PUN/2025 opportunity, the assessee is in a position to explain and substantiate its case before the Ld. CIT(E) by filing all the relevant details/documents. Considering the totality of the facts and in the circumstances of the assessee’s case, we are of the view that it would be judicially expedient and in the interest of justice and fair play if the matter is restored back to the file of Ld. CIT(E) to consider the assessee’s application for registration u/s 80G(5) of the Act afresh and decide the matter on merits, in accordance with facts and law after allowing one more opportunity of being heard to the assessee and present its case. The assessee shall provide the requisite support in terms of submitting the relevant details/documentary evidence as may be required/ called upon on the appointed date without seeking any adjournment unless for sufficient cause, failing which the Ld. CIT(E) shall be at liberty to pass appropriate order as per law. We order accordingly. 8. In the result, the appeal of assessee is treated as allowed for statistical purposes. Order pronounced in the open court on 29th April, 2025. Sd/- Sd/- (R.K. Panda) (Astha Chandra) VICE PRESIDENT JUDICIAL MEMBER पुणे / Pune; दिन ांक / Dated : 29th April, 2025. रदि आदेश की प्रधिधलधप अग्रेधिि / Copy of the Order forwarded to : 1. अपील र्थी / The Appellant. 2. प्रत्यर्थी / The Respondent. 3. The Pr. CIT concerned. 4. दिभ गीय प्रदिदनदि, आयकर अपीलीय अदिकरण, “बी” बेंच, पुणे / DR, ITAT, “B” Bench, Pune. 5. ग र्ड फ़ इल / Guard File. //सत्य दपि प्रदि// True Copy// आिेश नुस र / BY ORDER, िररष्ठ दनजी सदचि / Sr. Private Secretary आयकर अपीलीय अदिकरण ,पुणे / ITAT, Pune "