ITAT Condones Delay, allows Religious Trust another Chance for 12A Registration Appeal [Read Order]

The case involves Shree Goverdhan Nathji Pare Bethakji Seva Trust, which had appealed against an order dated July 25, 2024, from the CIT (Exemption) in Ahmedabad. The CIT(E) had rejected the trust's application for registration under Section 12A(1)(ac)(iii) and cancelled its provisional registration. The trust’s counsel explained the delay in filing the appeal to the tribunal, stating that the order was uploaded on the ITBA portal, but due to unavoidable circumstances, the trust could not check the email promptly. It was only when the trust followed up with its counsel on the status of the application that they discovered the rejection order. The appeal was subsequently filed on October 17, 2024, resulting in a 24-day delay, which the counsel argued was neither intentional nor deliberate.

During the proceedings, the trust’s authorized representative argued that the principles of natural justice were not followed during the initial assessment. He submitted that the assessee had missed two notices from the CIT(E), dated April 30, 2024, and June 6, 2024, which were purportedly served via email. The representative contended that the trust was prepared to submit all necessary documents and details and pleaded for one more opportunity to plead its case on merit. On the other hand, the revenue's representative relied on the original order but raised no objection if the matter was sent back to the CIT(E) for a fresh look. On the issue of the delay, he left the matter to the tribunal's discretion.

After hearing both sides, the ITAT bench found that the delay in filing the appeal was not intentional and decided to condone it. On the merits of the case, the tribunal observed that the CIT(E) had decided the matter ex parte due to the trust's non-compliance with the two notices. Citing settled law that principles of natural justice require an affected party to be granted a sufficient opportunity to be heard, the bench decided to restore the matter to the file of the CIT(E). The tribunal set aside the previous order and directed the CIT(E) to pass a fresh order in accordance with the law after giving the trust a reasonable opportunity for a hearing. The trust was also directed to be more vigilant and to furnish all required details and explanations without seeking unnecessary adjournments.

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The ruling was delivered by a bench comprising Pawan Singh (Judicial Member) and Bijayananda Pruseth (Accountant Member). The appeal of the assessee was allowed for statistical purposes.

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