2025 (7) TMI 817

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....he assessee has raised the following grounds of appeal: 1. The learned Commissioner of Income tax (Exemptions), Bangalore has erred in passing the impugned order in the manner passed by him. The order passed being bad in law, erroneous without considering the facts and is liable to be quashed. 2.1 The learned Commissioner of Income tax (Exemptions) has erred in rejecting the application filed for Registration U/s. 12AB of the I.T. Act, 1961, on the grounds that: i) The appellant has selected wrong section code while applying Form 10AB for registration. The appellant has selected section code '01-Sub clause (ii) of clause (ac) of sub - section (1) of section 12A'. Which is the applicable section co....

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....applied for the provisional registration before the ld. CIT(E) in form 10A under section 12A(1)(ac)(vi) of the Act on 24.3.2022. Thereafter, the assessee had been granted provisional registration in form 10AC u/s 12A(1)(ac)(vi) of the Act on 31.3.2022 effective from AY 2022-23 to AY 2024-25. The assessee trust thereafter commenced its activity on 5.5.2022 and accordingly applied for final registration in form 10AB on 3.2.2023 u/s 12A(1)(ac)(iii) of the Act. Thereafter, ld. CIT(E) Bangalore had granted registration in form 10AD u/s 12A(1)(ac)(iii) of the Act on 1.8.2023 effective from 2022-23 to AY 2026-27 subject to conditions mentioned in annexure to form 10AD. 3.1 Finally, the assessee trust filed form 10AB on 29.9.2024 u/s 12A(1)(ac)(....

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.... for registration and the reason for the same. We are of the considered opinion that another facet of the principles of natural justice is "right to reason". The ld. CIT(E) has not made any discussion as to how the section code selected by the assessee trust was wrong. Application of mind is best demonstrated by disclosure of mind by the authority making the order and the disclosure is best done by recording the reasons that led the authority to pass the order in question. In the absence of reasons in support of the order it is difficult to assume that the authority had properly applied his/her mind before passing the order. Further, we also take a note of the fact that the ld. CIT(E) before rejecting the application in Form 10AB even did n....