The Jaipur Bench of the Income Tax Appellate Tribunal ( ITAT ), has granted the trust the opportunity to rectify defects in Section 12AB of the Income Tax Act, 1961, with regard to registration applications.
In this case, the assessee, Ananvaya Nyasah, a Jaipur-based trust, had filed appeals challenging the CIT(E)’s rejection of its applications for registration under Section 12AB and approval under Section 80G of the Income Tax Act, 1961. The Commissioner of Income Tax (Exemptions) [ CIT(E) ] had rejected the applications citing non-registration under the Rajasthan Public Trust Act, 1959, and failure to establish the genuineness of its activities. The rejection also led to the cancellation of the trust’s provisional registration.
The ITAT noted that the trust had already applied for registration under the Rajasthan Public Trust Act and that the deficiencies pointed out by the CIT(E) were curable. The tribunal also observed that the trust was not provided with adequate opportunity to address the objections before the rejection of its applications. With a view that a liberal approach should be taken in such cases, the bench restored the matter to the CIT(E) for fresh adjudication.
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The ITAT also stated that its decision should not be interpreted as a comment on the merits of the case but was solely intended to ensure that the trust was given a fair opportunity to rectify the deficiencies. The bench directed the trust to submit all relevant documents and information to the CIT(E) for a proper evaluation of its applications.
The tribunal, comprising Rathod Kamlesh Jayantbhai ( Accountant Member ) and Sudhir Pareek ( Judicial Member), ruled in favor of the trust, setting aside the order of [CIT(E)] and directing a reconsideration of the application.
The ITAT allowed the appeals filed by the assessee for statistical purposes.
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