2021 (12) TMI 802 - AT - Income Tax

Exemption u/s 11 - rejection of applications seeking registration u/s 12AA and approval u/s 80G - No appearance by assessee - HELD THAT - We find that there is no dispute with regard to the fact that the impugned order was passed in the absence of the assessee. It is seen from the records that Ld.CIT(E) had given opportunity vide letters dated 20.01.2020, 19.06.2020 04.09.2020. In ordinary circumstances, these opportunities would have been sufficient for the assessee. However, looking to the fact that there has been wide spread of Covid-19 pandemic and on some occasions, the Government had also issued instructions for imposing lockdown. To sub-serve the interest of principle of natural justice and to provide meaningful opportunity for effective representation, the impugned order deserves to be set aside. We hereby, set aside the impugned order and restore the application u/s 12AA of the Act dated 09.12.2019 to the file of Ld. CIT(E) to decide it afresh - Grounds raised by the assessee are allowed for statistical purposes

Summary

Issues Involved:
Appeals against rejection of applications for registration u/s 12AA and approval u/s 80G of the Income Tax Act, 1961 due to absence of the assessee during proceedings.

Analysis:
1. Issue 1 - Registration u/s 12AA:
- The assessee filed applications for registration u/s 12AA and approval u/s 80G, but the applications were rejected in the absence of the assessee during the proceedings.
- The Ld.CIT(E) provided multiple opportunities for compliance, but the assessee failed to respond, leading to the rejection of the applications.
- The assessee contended that due to the Covid-19 Pandemic, they could not attend the proceedings and requested for a fresh opportunity.
- The Tribunal acknowledged the impact of the pandemic on proceedings and set aside the impugned order, restoring the application for registration u/s 12AA to the file of Ld.CIT(E) for a fresh decision after necessary inquiry.

2. Issue 2 - Approval u/s 80G:
- The same procedural issues arose in the appeal related to the rejection of approval u/s 80G, similar to the registration u/s 12AA.
- The Tribunal, following the same reasoning as in the previous appeal, set aside the impugned order and directed the Ld.CIT(E) to decide the application for approval u/s 80G afresh in accordance with the law.
- The Tribunal emphasized affording a reasonable opportunity for hearing to the assessee and directed them not to seek adjournments without reasonable cause or medical emergencies.

3. Conclusion:
- Both appeals were allowed for statistical purposes, emphasizing the importance of providing a meaningful opportunity for effective representation, especially during extraordinary circumstances like the Covid-19 Pandemic.
- The Tribunal's decision aimed to uphold the principles of natural justice and ensure fair proceedings by setting aside the orders passed in the absence of the assessee and allowing for a fresh decision after necessary inquiry.

This detailed analysis highlights the procedural aspects, legal arguments, and the Tribunal's decision in setting aside the rejection orders and providing the assessee with an opportunity for a fair hearing in both cases related to registration u/s 12AA and approval u/s 80G of the Income Tax Act.