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2024 (7) TMI 1424 - AT - Income TaxRejection of application for registration u/s 80G(5) - section code is wrongly mentioned - assessee accepted its mistake of wrongly selecting section code 13-Clause (ii) of first proviso to sub-section (5) of section 80G instead of selecting section code 14-Clause (iii) of first proviso to sub-section (5) of section 80G in letter dated 11.03.2023 and offered to resubmit the application - HELD THAT - As submitted that though the objects of the trust may be religious but the same is not bar for applying for 80G registration as section 80G(5B) itself provides allowance of 5% for religious expenditure. It was also explained that expenditure of temple etc. were not carried out by the trust but by the trustees in their individual capacity. Thus, the same did not appear in the financial statement of the trust. The position regarding vegan food center was also clarified. Likewise, explanation for non-audit of financial statements, work done by the trust for animal welfare, donation received by the assessee was furnished. Necessary evidence in support including the copy of the decision in Santshreshtha Gajajan Maharaj Sevabhavi Sanstha 2022 (12) TMI 338 - ITAT PUNE accompanied the said reply. But nothing was considered by the Ld. CIT(E) in his impugned order. The matter deserves to be set aside and restored back to the file of the Ld. CIT(E) for decision afresh on merits taking into account all the material available in the records and after allowing adequate opportunity of being heard to the assessee to present its case. Appeal of the assessee is treated as allowed for statistical purposes.
Issues Involved:
1. Rejection of the application for registration under section 80G(5) of the Income Tax Act. 2. Rejection of the application for registration under section 12AB of the Income Tax Act. Detailed Analysis: Issue 1: Rejection of the application for registration under section 80G(5) of the Income Tax Act 1. Facts and Grounds of Appeal: - The assessee filed an application in Form No. 10AB under clause (ii) of the first proviso to sub-section (5) of section 80G of the Income Tax Act on 10.12.2022. - The Ld. CIT(E) issued a notice on 10.03.2023 requiring the assessee to upload certain information/clarification/details. - The Ld. CIT(E) rejected the application on the grounds that the assessee did not furnish a copy of regular registration u/s 12AB or 10(23C) and that the application for registration u/s 12AB was already rejected. 2. Assessee's Arguments: - The assessee admitted to a clerical error in selecting the wrong section code and offered to resubmit the application. - The assessee contended that the Ld. CIT(E) did not consider their detailed submission and requested for more time to comply with the notice dated 18.06.2023. 3. Tribunal's Observations: - The Tribunal noted that the assessee accepted its mistake and offered to resubmit the application. - The Tribunal observed that the Ld. CIT(E) did not consider the detailed submission made by the assessee and passed the order without adequate consideration of the materials on record. 4. Decision: - The Tribunal set aside the order of the Ld. CIT(E) and remanded the matter back for fresh adjudication on merits, allowing adequate opportunity for the assessee to present its case. Issue 2: Rejection of the application for registration under section 12AB of the Income Tax Act 1. Facts and Grounds of Appeal: - The assessee filed an application in Form No. 10AB under clause (iii) of section 12A(1)(ac) on 10.12.2022. - The Ld. CIT(E) issued a notice on 14.03.2023 requiring certain information/clarification. - The Ld. CIT(E) rejected the application citing discrepancies and the lack of satisfactory clarification and documentary evidence on the genuineness of the activities. 2. Assessee's Arguments: - The assessee contended that they provided point-wise replies to the Ld. CIT(E)'s queries and requested more time to collate necessary documentary evidence. - The assessee argued that the Ld. CIT(E) did not consider their detailed submission and relied on several legal precedents to support their case. 3. Tribunal's Observations: - The Tribunal noted that the assessee furnished a detailed reply and rebutted the points raised by the Ld. CIT(E). - The Tribunal observed that the Ld. CIT(E) did not consider the assessee's rebuttal and passed the order without adequate consideration of the materials on record. 4. Decision: - The Tribunal set aside the order of the Ld. CIT(E) and remanded the matter back for fresh adjudication on merits, considering all the material available in the records and the legal precedents relied upon by the assessee. Conclusion: Both appeals (ITA Nos. 949 & 950/PUN/2023) are allowed for statistical purposes, with the matters remanded to the Ld. CIT(E) for fresh adjudication on merits, ensuring adequate opportunity for the assessee to present their case.
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