ITAT Remands Case Back, Grants Fresh Opportunity for Registration under Sections 12AB and 80G [Read Order]

The Income Tax Appellate Tribunal (ITAT) Mumbai Bench remanded the case of a Trust back to the Commissioner of Income Tax (Exemptions) CIT(E), granting the trust a fresh opportunity to seek registration under Section 12AB and approval under Section 80G of the Income Tax Act, 1961. The tribunal ruled that the trust was not given sufficient time to respond to the last notice issued by CIT(E), which led to the rejection of its applications.

Mohanlal Shikshan Sanstha, appellant Trust had applied for registration under Section 12AB and approval under Section 80G by submitting Form 10AB. The CIT(E) issued multiple notices seeking details about the trust’s activities and financial records.

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The trust complied with earlier notices but was given only three days to respond to the final notice dated September 21, 2024. Due to the short timeframe, the trust could not provide the required information, leading to the CIT(E) rejecting its applications on September 25, 2024.

Consequently, the trust appealed before the ITAT Mumbai, arguing that it had been complying with the notices and should have been granted more time for the final submission.

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The ITAT Mumbai Bench composed of Saktijit Dev(Vice-President) and Renu Jauhri(Accountant Member) ruled in favor of the trust, acknowledging that it had made efforts to comply with the department’s requests.

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The tribunal observed that the CIT(E) had rejected the application due to a statutory deadline of September 30, 2024, rather than due to any failure on the trust’s part to furnish necessary details.

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The ITAT noted that since the trust had responded to previous notices and was willing to provide the pending details, the CIT(E) should have exercised discretion and granted a reasonable extension.

Based on these findings, the ITAT set aside the CIT(E)’s rejection order and remanded the case back for fresh adjudication. The trust has been directed to submit the required details, while the CIT(E) has been instructed to issue a fresh order within three months from the date of receiving the ITAT’s decision.

To Read the full text of the Order CLICK HERE

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