2020 (10) TMI 937 - AT - Income Tax

ITAT grants Assessee's appeal, directs fair reconsideration under section 80G(5)(vi)

The ITAT allowed the appeal of the Assessee, setting aside the rejection of the application under section 80G(5)(vi) of the I.T. Act, 1961 by the Ld. ... Application u/s 80G(5)(vi) rejected - charitable activity u/s 2(15) - assessee has been granted registration u/s 12AA - HELD THAT:- From the registration granted u/s 12AA that objects of the assessee were charitable in nature and assessee has been doing some activities. On the last date of hearing the CIT(E) called for certain explanation and details with regard to activities which according to Assessee have been sent vide letter dated 27.12.2017 through email on 29.12.2017. CIT(E) has passed the impugned order prior to it on 28.12.2017. Thus, it would show that assessee was interested in pursuing the matter and there was no justification for the Ld. CIT(E) to hold that assessee is not interested in pursuing the matter. Copy of the email of the O/o. Ld. CIT(E) dated 22.12.2017 is filed at page-128 of the PB in which even no date have been given for making the compliance. There were no justification to pass the impugned order on 28.12.2017 before waiting for the reply of the assessee which assessee has ultimately filed on 29.12.2017. The facts clearly show that the matter requires re-consideration at the level of the CIT(E) because the documentary evidence or record have not been considered and appreciated by him. In view of the above discussion, we set aside the impugned order. Appeal of the Assessee is allowed for statistical purposes. Issues:Appeal against rejection of application under section 80G(5)(vi) of the I.T. Act, 1961.Analysis:The appeal was filed against the Order of the Ld. CIT(E), Chandigarh, rejecting the application under section 80G(5)(vi) of the I.T. Act, 1961. The Ld. CIT(E) noted that for approval under section 80G(5)(vi), the institution or fund must be established in India for 'Charitable Purposes'. The assessee had filed an application on 01.06.2017 for approval under section 80G, after being incorporated on 27.05.2016 and granted registration under section 12AA of the Act on 27.03.2017. The Ld. CIT(E) issued show cause notices to the assessee for information regarding the society's objects, use of donations, and activities not reflected in financial statements. The assessee responded to the queries through email, with the last reply sent on 27.12.2017. However, the Ld. CIT(E) rejected the application on 28.12.2017, deeming the assessee uninterested in pursuing the matter.The Learned Counsel for the Assessee argued that all queries were responded to, and documentary evidence was not fully considered by the Ld. CIT(E). The matter was then presented for reconsideration, with the Ld. D.R. suggesting a remand to the Ld. CIT(E) for a review. The ITAT considered the submissions and found that the Ld. CIT(E) had received responses from the assessee, and the registration under section 12AA indicated charitable objectives were being pursued. The ITAT noted that the last response from the assessee was sent on 29.12.2017, a day after the impugned order was passed. Highlighting the lack of justification for the rejection, the ITAT set aside the order and directed the Ld. CIT(E) to re-decide the matter, ensuring the documentary evidence and records are duly considered and giving the assessee a fair opportunity to be heard.Therefore, the ITAT allowed the appeal of the Assessee for statistical purposes, emphasizing the need for a reconsideration of the matter by the Ld. CIT(E) in accordance with the law, providing the assessee with a reasonable and sufficient opportunity to present their case.