2018 (2) TMI 1594 - AT - Income Tax

Appeal allowed due to lack of essential details under Income Tax Act

The appeal arose against the rejection of the registration application u/s.12AA of the Income Tax Act, 1961 by the CIT(Exemptions), Ahmedabad due to the ... Approval u/s. 12AA denied - eligibility criteria - assessee has not filed the relevant details in support of its registration application - Held that:- Assessee refers to the relevant statement of facts pleading therein that father of the managing trustee and President had demised at the time when the registration’s case was fixed before CIT(Exemptions). He stated to have filed for adjournment application as well. The assessee is very much interested in pursuing its registration plea before the CIT(Exemptions). She has also filed a detailed compilation of all the relevant details comprising of forwarding letter of registration application, Form 10A, copy of memorandum and request of Association of the Trust, Charity Commissioner’s Bhuj’s Certificate, PAN card, notice dated 07.05.2015, adjournment application sent through courier, its tracking detail, death certificate of father of the managing trustee, reply of notice dated 07.05.2015 (which could not be filed), copy of enquiry application dated 05.01.2016 and request letter seeking copy of the impugned order; respectively. The above details in support of assessee’s registration application need to be examined in detail in corresponding proceedings. - Decided in favour of assessee for statistical purposes. Issues:1. Rejection of registration application u/s.12AA of the Income Tax Act, 1961 by CIT(Exemptions), Ahmedabad.2. Lack of communication leading to failure in filing relevant details.3. Appeal against rejection of registration application.Issue 1: Rejection of registration application u/s.12AA:The appeal arose against the CIT(Exemptions), Ahmedabad's order rejecting the registration application u/s.12AA of the Income Tax Act, 1961. The CIT found that the assessee failed to provide essential details as required by the procedure for registration u/s 12AA. Despite issuing multiple letters requesting specific documents and information, the applicant did not attend the office, furnish any details, or seek adjournment. The CIT concluded that without complete details, it was impossible to ascertain the genuineness of the trust's activities. Consequently, the application was rejected as the CIT was unable to satisfy about the genuineness of the activities of the trust or their alignment with the trust's objects.Issue 2: Lack of communication leading to failure in filing relevant details:The counsel for the assessee highlighted a lack of proper communication between the assessee and the relevant date of hearing in the registration proceedings as the reason for not filing the necessary details. The counsel explained that due to the demise of the managing trustee's father at the time of the hearing, there were difficulties in communication and filing the required documents. The counsel submitted a detailed compilation of relevant documents to support the registration application, emphasizing the interest of the assessee in pursuing the registration plea. The Tribunal observed that the larger interest of justice would be served by allowing the assessee to submit the necessary details and directed the CIT(Exemptions) to consider these documents and pass a fresh order after providing a fair hearing to the assessee.Issue 3: Appeal against rejection of registration application:The Tribunal allowed the assessee's appeal for statistical purposes, emphasizing the importance of proper communication and providing an opportunity for the assessee to present the required details. The Tribunal directed the assessee to send a copy of the Tribunal's order along with the case records to the CIT(Exemptions) within a specified timeframe to ensure a fair reconsideration of the registration application.This detailed analysis outlines the rejection of the registration application, the communication challenges faced by the assessee, and the Tribunal's decision to allow the appeal for the sake of justice and fairness in the registration process.