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2022 (3) TMI 1346 - AT - Income TaxExemption u/s 11 - Denial of grant of registration and approval u/s. 12AA/80G - HELD THAT - From perusal of the written submissions made by the assessee before the Ld. CIT(E), we note that they are dated 04.10.2018, 14.09.2018, but bears acknowledged stamp/seal of the office of the CIT(E), Patna which is dated 11.10.2018. It is noted that impugned order of the Ld. CIT(E) is dated 03.10.2018 whereas the submissions made and received by the O/o the CIT(E) are dated 11.10.2018. On a specific query by the Bench to assessee on these dates, it was submitted by him that the impugned order of rejection of application was passed by the Ld. CIT(E) without considering the submissions made by the assessee for which the assessee should not be made to suffer. In the present set of facts and circumstances and considering the material and the relevant documents on record, we find it fit and proper to set aside the matter to the file of the Ld. CIT(E) and to reconsider the application made by the assessee for grant of registration and approval u/s. 12AA/80G of the Act by taking into account the material which is already on record and to pass a fresh order in accordance with law. Needless to say that the assessee be given reasonable opportunity of being heard with liberty to file any further details/documents before the Ld. CIT(E) in support of its application for grant of registration or approval. We set aside the impugned order and restore the matter back to the file of Ld. CIT(E) to re-consider the application made for registration u/s 12AA afresh by providing reasonable opportunity of being heard to the assessee. Appeal of the assessee is allowed for statistical purpose.
Issues:
- Rejection of application for grant of registration u/s 12AA and 80G(5)(vi) of the Income-tax Act, 1961 for A.Y 2018-19. Detailed Analysis: Issue 1: Rejection of Registration Application The assessee appealed the rejection of the application for registration under sections 12AA and 80G(5)(vi) of the Income-tax Act, 1961. The CIT(E) rejected the application citing deficiencies in the genuineness of activities, lack of details of beneficiaries, and unverified donation receipts. The CIT(E) observed that without proper evidence, claimed activities could not be established. The rejection was based on the lack of submission of bills, vouchers, and details of beneficiaries. Issue 2: Assessee's Arguments The assessee contended that all required documents and evidence were submitted to the CIT(E) for consideration. The counsel argued against the CIT(E)'s observations regarding expenses verification and donation genuineness. The counsel emphasized that expenses and donation details were provided, and the CIT(E) should only assess the society's objects at the registration stage, not income or expenditure. The counsel cited the judgment of the Hon'ble High Court of Karnataka in support of the contention. Issue 3: Department's Arguments The CIT (DR) supported the rejection of the application, relying on the CIT(E)'s observations. The department argued that the rejection was justified based on the deficiencies noted in the application. Judgment and Decision After hearing both parties and reviewing the submissions, the Tribunal noted discrepancies in the dates of submissions and the CIT(E)'s order. In the interest of justice, the Tribunal set aside the CIT(E)'s order and remanded the matter back for reconsideration. The Tribunal directed the CIT(E) to re-examine the application for registration under sections 12AA and 80G, providing the assessee with a reasonable opportunity to be heard and submit additional documents if required. The Tribunal allowed the appeals of the assessee for statistical purposes. Conclusion The Tribunal emphasized the CIT(E)'s limited jurisdiction to verify the trust's objects and activities' genuineness for registration under section 12AA. The Tribunal's decision focused on procedural fairness and the need for a thorough review of the application. Both appeals of the assessee were allowed, and the matters were remanded back to the CIT(E) for re-consideration.
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