2020 (12) TMI 1224 - AT - Income Tax

ITAT Mumbai remits case for compliance with section 12A registration requirements. Assessee's appeal allowed.

Marathwada Mitra Mandal Versus CIT (Exemption), Mumbai

The ITAT Mumbai remitted the case back to the learned CIT(A) to provide the assessee with another opportunity to comply with the registration requirements ... Exemption u/s 11 - rejecting the assessee’s application for registration u/s.12A - HELD THAT:- In our considered opinion the non-compliance by the assessee is fully attributable to the conduct of the consultant. In the substance interest of justice, we remit the issue to the file of learned CIT(A). Learned CIT(A) shall give the assessee one more opportunity for the compliance of his queries. Thereafter he shall decide as per law. The assessee is also directed to provide full cooperation. Issues:Appeal against rejection of registration u/s. 12A of the Income Tax Act by the learned CIT(A).Analysis:The appeal was against the rejection of the assessee's application for registration u/s. 12A of the Income Tax Act by the learned CIT(A). The assessee's Trust had filed the registration application on 11.5.2017 but failed to submit various required details, leading to the rejection of the application. The rejection was based on the non-submission of property details, loan information, and financial statements for specific assessment years. The assessee contended that the failure to comply was due to the non-cooperation of their auditors, resulting in delays and non-submission of necessary documents. The authorized CA's lack of cooperation and failure to inform the Trust about the requirements were highlighted as reasons for the non-compliance. The Trust eventually appointed a new firm of Chartered Accountants to complete the audits and comply with the registration requirements.The ITAT Mumbai, after hearing both counsels and reviewing the case, found that the non-compliance was primarily due to the conduct of the consultant, i.e., the auditors. In the interest of justice, the ITAT remitted the issue back to the learned CIT(A) for another opportunity for compliance. The learned CIT(A) was directed to provide the assessee with a chance to fulfill the queries and then decide as per the law. The assessee was also instructed to fully cooperate in the process. Consequently, the appeal by the assessee was allowed for statistical purposes, with the order pronounced on 10.12.2020 under Rule 34(4) of the ITAT Rules.