Tribunal overturns registration denial under Income Tax Act, stresses fair hearing and CSR compliance

The Tribunal set aside the order rejecting the application for registration under section 12AA of the Income Tax Act, noting the Trust's compliance with requirements and aims to fulfill corporate social responsibility obligations. The Tribunal directed the Commissioner of Income Tax (Exemptions) to issue a speaking order after granting the assessee a fair hearing opportunity. The Tribunal emphasized the importance of full participation without abusing trust. The appeal was allowed for statistical purposes, with the decision announced in Open Court on 20th April 2018.

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Issues:
1. Correctness of the order u/s 12AA(1)(b)(ii) of the Act dated 24.08.2017
2. Rejection of application u/s 12 AA of the Income Tax Act 1961
3. Non-attendance due to final notice received on E-mail
4. Request for restoration of appeal for adjudication after hearing the assessee
5. Opportunity of being heard and remanding the matter back to the authority
6. Passing of order ex-parte
7. Seeking registration u/s 12A on 02.02.2017
8. Trust's Aims and Objects
9. Settlers of the Trust and their relationship with the parent company
10. Directions for passing a speaking order and giving a reasonable opportunity of being heard
11. Participation before the authority and not abusing the trust

Analysis:
1. The appeal was filed challenging the correctness of the order u/s 12AA(1)(b)(ii) of the Act dated 24.08.2017. The appellant argued that the Commissioner of Income Tax Exemptions erred in rejecting the application u/s 12 AA due to non-attendance, which was attributed to a final notice received via E-mail that went unanswered. The Trust fulfilled all conditions for registration, and the appellant sought the grant of the same.

2. The appellant requested the restoration of the appeal for adjudication after hearing the assessee. The appellant's representative highlighted that the assessee had sought an adjournment on a previous hearing date, but subsequent notices were not received by the assessee due to not checking the E-mail. The appellant prayed for an opportunity to be heard and for the matter to be remanded back to the authority for compliance with necessary information.

3. The Senior DR had no objection if the assessee presented full facts and submissions before the CIT (Exemptions), acknowledging that the order had been passed ex-parte.

4. The Tribunal reviewed the material on record, noting that the Trust had applied for registration u/s 12A on 02.02.2017. The Trust's Aims and Objects, including fulfilling CSR obligations of the parent company, were considered. The Tribunal set aside the impugned order and directed the CIT (Exemptions) to pass a speaking order after giving the assessee a reasonable opportunity to be heard. The assessee was instructed to participate fully and fairly, with a warning against abusing the trust reposed.

5. The Tribunal allowed the appeal of the assessee for statistical purposes, with the order pronounced in the Open Court on 20th April 2018.

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