2024 (8) TMI 538 - AT - Income Tax

Denial of exemption u/s 80G(5) - As Assessee has not filed the present application within the time limit allowed not only rejected the application filed by the Assessee but also cancelled the provisional registration granted on 19.03.2022 under clause (iv) for 1st proviso to section 80G(5) of the Act - HELD THAT - Assessee remained un-represented which resulted into passing the order in limine but not on merits. As the Ld. Commissioner was unable to pass the order on merits in the absence of relevant reply/submissions and documents, therefore for the just decision of the case and for the ends of substantial justice, we are inclined to set aside the impugned order and consequently the case is remanded to the file of the Ld. Commissioner for decision afresh on merits, suffice to say by affording reasonable opportunity to the assessee to substantiate its claim. We also direct the assessee to cooperate with the appellate proceedings and to file the relevant submissions/documents which would be essential and required by the Ld. Commissioner for proper adjudication of the case. In case of further default the assessee shall not be entitled for any leniency. Appeal filed by the assessee stands allowed for statistical purposes.

Summary

Issues: Delay in filing appeal, rejection of application under section 80G(5) of the Income Tax Act, 1961, condonation of delay, remand of case for decision on merits.

Delay in Filing Appeal:
The appeal was filed with a delay of 269 days due to the Assessee initially preferring the appeal before the Pune Bench based on a mistaken belief regarding jurisdiction. The Pune Bench clarified the correct jurisdiction, leading the Assessee to file the instant appeal before the Mumbai Tribunal within 15 days of the clarification. The Tribunal, considering the delay as unintentional and based on a genuine belief, decided to condone the delay.

Rejection of Application under Section 80G(5):
The Assessee had applied for exemption under section 80G(5) by filing an application, which faced scrutiny by the Assessing Officer (AO) due to discrepancies. Despite multiple requests for information, the Assessee failed to respond adequately to a final show cause notice, leading to the rejection of the application and cancellation of provisional registration by the Ld. Commissioner. The Assessee contended that the dismissal was not based on merits and sought another opportunity to present its case.

Condonation of Delay:
The Tribunal, after reviewing the reasons for the delay, found them to be sufficient, genuine, and reasonable. Consequently, the delay of 269 days in filing the appeal was condoned, allowing the case to be heard on its merits.

Remand of Case for Decision on Merits:
The Tribunal observed that the Ld. Commissioner's rejection of the application was primarily due to procedural reasons, as the Assessee had not filed within the specified time limit, rather than on substantive grounds. Given that the Assessee had not been able to present its case adequately, the Tribunal set aside the order and remanded the case to the Ld. Commissioner for a fresh decision on merits. The Assessee was directed to cooperate with the proceedings and provide necessary submissions for a fair adjudication.

In conclusion, the appeal filed by the Assessee was allowed for statistical purposes, with the case being remanded for a fresh decision on merits, emphasizing the importance of providing all relevant information for a just outcome in legal proceedings.