The Ahmedabad Bench of the Income Tax Appellate Tribunal ( ITAT ) directed the CIT(E) to give affordable opportunity to the assessee in the matter of non-submission of the documents while granting the provisional registration It remanded the matter back to the file of the CIT(E).
Assessee, Vidhyanagar Jain Society, applied for registration of the charitable trust under section 12A(1)(iii)(ac) with Form 10AB to the Commissioner of Income Tax (Exemptions) CIT(E) in Ahmedabad. The CIT(E) had sent notices for hearings but the assessee could not make it due to unforeseen and unavoidable circumstances. The CIT(E) rejected the application due to insufficient documents and a delay in submission.
The assessee appealed before the ITAT, Ahmedabad. The assessee’s counsel argued that they applied in good faith and could not submit the required documents within the stipulated time due to unforeseen and unavoidable circumstances despite receiving two hearing notices. The assessee’s counsel mentioned that the assessee responded to the notices and expressed the intention to comply with the required document submission.
The assessee’s counsel contended that failure to respond to the income tax notices should not have resulted in the assumption that the assessee’s activities are not genuine and humbly request leniency. The assessee’s counsel requested to remand the matter back to the CIT(E) to allow the assessee to rectify the deficiencies in the application process and present the necessary documents for registration. The assessee’s counsel relied on the Kalyan Riverside Charitable Foundation vs CIT (Exemption) Pune which is similar to this case and the tribunal allowed the appeal in the favour of the assessee.
The respondent’s represented by Kamlesh Makwana argued that the CIT(E) had sent notices twice to submit the required documents. It contended that the assessee neither filed any submission nor sought any adjournment.
The assessee’s counsel responded that one of the assessee was ill and the other had traveling commitments for one and a half months.
The bench of Siddhartha Nautiyal (Judicial Member) and Makarand V. Mahadeokar (Accountant Member) observed the arguments. The tribunal observed that the assessee was granted provisional registration and the CIT(E) could not verify the genuineness of the assessee’s activities despite giving opportunities to submit the required documents.
The tribunal noted that the CIT(E) counsel didn’t object to referring the matter back to the file of CIT(E) for fresh adjudication on merit. For the just decision and for the ends of substantial justice, the matter remands back to the CIT(E). It set aside CIT(E)’s order and the appeal of the assessee allowed for statistical purposes
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