Charitable Trust Registration Rejected Without Fair Hearing Opportunity: ITAT orders Reconsideration [Read Order]

The Income Tax Appellate Tribunal (ITAT), Amritsar Bench has invalidated the rejection of the application for registration of Charitable Trust observing that the assessee was not offered a fair and reasonable opportunity of being heard.

The appeal was filed by the Society of Educational Assistance and Training

against the order of the Commissioner of Income Tax (Exemption) (CIT(E)), Chandigarh rejecting the registration application of the assessee under Section 12AA and Section 80G(5) of the Income Tax Act, 1961.

The assessee is a charitable organisation that provides education to economically disadvantaged students and the wider community without any discrimination based on caste or creed.

The assessee trust, represented by Yasmeen Jan, its Trustee, argued that the rejection of registration was arbitrary and contended that they were denied a reasonable opportunity to be heard during the proceedings.

The assessee also expressed concerns over the inadequate time provided to them by the revenue authorities for submission of necessary documents.

The revenue pointed out the deficiency in factual evidances and absence of requisite submissions from the side of the assessee.

The revenue argued that there is non-compliance of the notice by the assessee since they had not appeared for the scheduled hearings along with the requsite documents before the authority.

The revenue, represented by Sh. Girish Bali, substantiated the rejection of application for registration made under Section 12AA of the Income Tax Act, 1961 arguing that the assessee had not utilised the opportunity for hearing and in the absence of any submission from assessee, it is impossible to ascertain the objects and activities carried out by the assessee.

The bench clarified that the assessee is a charitable trust providing education to people without considering any caste or creed.

The bench observed that the assessee had been denied a fair opportunity to present their case and submit the required documents before the revenue authorities.

The two-member bench consisting of Dr. M. L. Meena (Accountant Member) and Anikesh Banerjee (Judicial Member), finding merit in assessee's contentions, remitted back the matter to the CIT(E) for de novo adjudication, granting the assessee a reasonable opportunity for a hearing and submission of evidence. The appeal of the assessee was allowed for statistical purposes.

To Read the full text of the Order CLICK HERE

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