2017 (11) TMI 171 - AT - Income Tax

Request for registration of the assessee society u/s 12A(1) rejection - assessee had failed to provide the complete address and PAN of the donors and also failed to produce the books of account, bank statements and vouchers in respect of expenses claimed by the assessee for verification of the objects and activities of the trust - Held that - On a careful consideration of the matter and having regard to the submissions of the ld. AR, we are of the considered opinion that instead of dismissing the appeal in limine for non-production of the record before the Ld. CIT (E) during the course of enquiry, the ends of justice would be met by allowing an opportunity to the assessee to prove their case with reference to the documentary evidence to be produced before the Ld. CIT (E). It is made amply clear that it is the final opportunity to the assessee to produce all the relevant record before the Ld. CIT (E) and to cooperate for the disposal of the matter on merits. Ld. CIT (E) will afford an opportunity to the assessee to prove their case by producing the record available with them.

Summary

Issues: Appeal against rejection of registration u/s 12A(1) of the Income Tax Act due to failure to provide complete address and PAN of donors, failure to produce books of account, bank statements, and vouchers.

In this judgment by the Appellate Tribunal ITAT Delhi, the appeal challenged the order of the Ld. Commissioner of Income Tax (Exemptions)-Lucknow, rejecting the registration of the assessee society u/s 12A(1) of the Income Tax Act, 1961. The rejection was based on the assessee's failure to provide complete address and PAN of donors, as well as the failure to produce books of account, bank statements, and vouchers for verification of the trust's objects and activities. The Ld. AR submitted that due to a mistake, the records could not be produced before the Ld. CIT (E), and if given an opportunity, the assessee was willing to present the evidence before the Tribunal or lower authorities. The Ld. DR argued that despite being given the best opportunity, the assessee still failed to produce the necessary documents. The Ld. AR pointed out discrepancies in the claims made by the assessee regarding distribution of dry fruits to the poor and needy, while the Ld. DR contended that considering such materials at this stage would not be feasible. The Tribunal, after considering the submissions, decided to grant the assessee a final opportunity to produce all relevant records before the Ld. CIT (E) and cooperate for a thorough examination of the case on its merits. The appeal was allowed for statistical purposes, emphasizing the importance of producing the required documentation for further proceedings.

This judgment highlights the significance of complying with the procedural requirements for registration under the Income Tax Act, emphasizing the need for complete and accurate documentation to support the activities and objects of a trust or society seeking registration. It also underscores the principle of providing opportunities for parties to present their case and evidence, even in situations where initial failures to produce documents occurred. The decision to grant a final opportunity to the assessee reflects the Tribunal's commitment to ensuring a fair and thorough consideration of the matter, with a focus on substantiating claims through proper documentation. The judgment serves as a reminder of the responsibilities and obligations of entities seeking tax exemptions or benefits under the law, emphasizing the importance of maintaining transparency and providing necessary information to tax authorities for effective evaluation and decision-making.