2021 (4) TMI 198 - AT - Income Tax

Application for exemption under Section 12AA(1)(b)(ii) rejected - HELD THAT - It appears that though all the documents as directed to be submitted by the appellant were not submitted before the Revenue but the Ld. CIT(E) has not even taken into consideration the documents already submitted before him while considering the matter for registration of the appellant trust under Section 12AA of the Act. Hence, in order to prevent the miscarriage of justice, in our considered opinion another opportunity be given to the appellant to present its case before the Revenue with all the evidences/documents. In that view of the matter we quash the order impugned and set-aside the issue to the file of the Ld. CIT(E) for his consideration afresh upon taking into account the evidences on record in support of the case of the assessee or any other evidence which the assessee may choose to file at the time of hearing of the matter. The Ld. CIT(E) is further directed to give an opportunity of being heard to the assessee for proper consideration of the matter. Appeal is allowed for statistical purposes.

Summary

Issues:
1. Rejection of application for exemption under Section 12AA(1)(b)(ii) of the Income Tax Act, 1961.
2. Rejection of application for approval under Section 80G(5)(vi) of the Income Tax Act, 1961.

Issue 1: Rejection of application for exemption under Section 12AA(1)(b)(ii) of the Income Tax Act, 1961:
The appeal arose from the orders passed by the Ld. CIT(E) Ahmedabad rejecting the application for exemption under Section 12AA of the Act. The appellant failed to provide necessary details and documents despite multiple opportunities. The Ld. CIT(Exemption) rejected the application as the genuineness of the trust's activities could not be verified due to lack of relevant documents. During the appeal hearing, the appellant's counsel argued that the documents were submitted on time but were not considered by the Ld. CIT(E). The ITAT observed that although all directed documents were not submitted, the Ld. CIT(E) failed to consider the documents already provided. To prevent a miscarriage of justice, the ITAT set aside the order and directed the Ld. CIT(E) to reconsider the matter, giving the appellant an opportunity to present all evidence. The appeal was allowed for statistical purposes.

Issue 2: Rejection of application for approval under Section 80G(5)(vi) of the Income Tax Act, 1961:
The order rejecting the application for approval under Section 80G(5)(vi) of the Act was challenged, which was linked to the application under Section 12AA being reconsidered. The ITAT directed the CIT(Exemption) to pass orders in accordance with the reconsideration of the Section 12AA application. Ultimately, both appeals of the assessee were allowed for statistical purposes. The order was pronounced in Open Court on 02/03/2021.

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