The Ahmedabad bench of the Income Tax Appellate Tribunal (ITAT) set aside the Commissioner of Income Tax (Exemption) [CIT(E)] order, noting that the assessee had not been given a fair opportunity to be heard before the rejection of the application under Section 80G (5) of the Income Tax Act, 1961, as principles of natural justice require such an opportunity.
An appeal has been filed by the assessee against the order dated September 20, 2023, issued by the Commissioner of Income Tax (Exemption) [CIT (E)] in Ahmedabad. The order rejected the application for registration under Section 80G (5) of the Income Tax Act, 1961.
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The assessee, Manav Seva Mandir has also submitted an application seeking the condonation of a 129-day delay in filing the appeal. The delay is attributed to the assessee’s lack of awareness regarding the notices issued by CIT (E) due to the absence of any communication through email, message, or post. Consequently, the assessee could not respond to the notices dated August 4, 2023, and August 31, 2023, leading to the rejection of the Section 80G (5) application.
Mr. H. Phani Raju representing the revenue confirmed that the CIT (E)’s office had failed to serve the email notice to the assessee due to a technical error. An email confirmation from CIT (E)’s office was presented, indicating that the assessee’s email ID could not be retrieved due to this technical issue. Despite this, further noted that the assessee could have accessed the notices or orders via the e-portal and would have received alerts on their registered mobile number.
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The bench, comprising T.R. Senthil Kumar (Judicial Member) and Makarand V. Mahadeokar (Accountant Member), reviewed the appeal grounds, the case facts, the trustee’s affidavit, and the DR’s submission. The affidavit supported the claim that the delay was unintentional and not due to any malafide intention but rather due to inadequate communication from the department.
Given the email confirmation from CIT (E)’s office, it was determined that the assessee was not properly served with the notice or order via email, marking a significant procedural lapse. This finding aligns with the Supreme Court’s decision in Collector, Land Acquisition, Anantnag v. Mst. Katiji, which advocates a liberal interpretation of “sufficient cause” under Section 5 of the Limitation Act, 1963, to uphold justice.
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The ITAT decided to condone the delay in filing the appeal. On examining the merits, it was observed that the assessee had not been given a fair opportunity to be heard before the application rejection under Section 80G (5). The principles of natural justice necessitate such an opportunity.
The ITAT has set aside the CIT(E)’s order dated September 20, 2023, and remanded the matter to CIT(E) for a fresh decision on merits, ensuring that the assessee is given a reasonable opportunity to present their case.
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The CIT (E)’s order was set aside and the case was returned to CIT (E) for reconsideration in accordance with the principles of natural justice.
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