The Income Tax Appellate Tribunal (ITAT) Chennai Bench has set aside the order of the Commissioner of Income Tax (Exemptions) CIT(E) rejecting the 80G registration application of appellant. The tribunal ruled that the assessee was not provided sufficient time to submit the required details, which amounted to a violation of the principles of natural justice.
S K N N S M Society, appellant-assessee had filed an application on March 13, 2024, in Form 10AB under Rule 17A of the Income Tax Rules, 1962, seeking approval under Section 80G(5)(iii) of the Income Tax Act, 1961. The CIT(E) issued a letter on June 6, 2024, asking the assessee to submit details of its activities, to which the assessee responded. However, on July 11, 2024, the CIT(E) issued another show-cause notice, requiring additional documents by July 16, 2024, allowing only five days for compliance. The assessee failed to respond within the given period, leading to rejection of the application by the CIT(E).
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Challenging the rejection, the assessee filed an appeal before the ITAT, contending that the time given was too short to furnish the required details. The assessee argued that the rejection was unfair and that if granted sufficient opportunity, it could provide the necessary documents to support its case.
The tribunal carefully examined the matter and found that the CIT(E) had given an unreasonably short deadline to comply with the notice. The ITAT ruled that to uphold the principles of natural justice, the assessee must be given another opportunity to present its case before the CIT(E).
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The case was heard by Manoj Kumar Aggarwal (Accountant Member) and Manu Kumar Giri (Judicial Member). The tribunal decided to remand the matter back to the CIT(E) for fresh adjudication. The CIT(E) has been directed to provide the assessee with a reasonable opportunity to submit all necessary documents before making a final decision. The assessee has also been advised to comply with the proceedings without further delays.
The ITAT concluded that the order passed by the CIT(E) was not sustainable, as it did not allow adequate time for response. Therefore, the rejection order was set aside, and the matter was sent back for De Novo (fresh) adjudication.
In the result, the appeal was allowed for statistical purposes.
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