Case Law Details
Idam Braahmam Society Vs CIT (Exemption) (ITAT Hyderabad)
In the case of Idam Braahmam Society vs. CIT (Exemption), the ITAT Hyderabad reviewed an appeal against the CIT(E)’s order rejecting the society’s application for registration under section 12AB of the Income Tax Act, 1961. The rejection was based on the society’s failure to provide necessary documents due to the resignation of its secretary, who had not received the notice. The society claimed that the resignation led to their inability to respond, resulting in the application’s dismissal. The ITAT found the society’s explanation credible, as there was no apparent benefit for the society in deliberately missing the notice. Consequently, the tribunal directed the CIT(E) to reconsider the application on its merits after providing the society an opportunity to present the required documents. The appeal was thus allowed for statistical purposes, emphasizing the need for a fair review of the application in light of the circumstances described.
FULL TEXT OF THE ORDER OF ITAT HYDERABAD
Aggrieved by the order dated 20/12/2023 passed by the learned Commissioner of Income Tax (Exemption) (“Ld. CIT”), in the case of Idam Braahmam Society (“the assessee”) for the assessment year 2023-24, assessee preferred this appeal.
2. Assessee applied for registration under section 12AB of the Income Tax Act, 1961 (for short “the Act”), and the learned CIT(E) while recording that issuance of notices and granting opportunity the assessee did not produce the copy of the Memorandum of Association/trust deed for verification and to furnish any reply, rejected the application submitted in form No. 10AB seeking registration under section 12AB of the Act.
3. Assessee submits that at the relevant point of time the secretary of the society was not available because he resigned and left the premises and therefore, the assessee could not receive the notice resulting in the rejection of the application. Learned AR submits that subsequently the assessee came to know of the rejection of the application and then after obtaining the necessary papers from the resigned secretary, the assessee approached the counsel and filed this appeal. Learned AR submitted that by allowing the application rejected for default the assessee does not stand to gain and, therefore, an opportunity may be granted to the assessee to pursue their application before the learned CIT(E) diligently.
4. Learned DR submitted that the facts stated by the learned AR are not in the knowledge of the Department and it is for the assessee to prove such facts before seeking an opportunity at this stage.
5. We have gone through the record in the light of the submissions made on either side. The plea taken by the assessee that the notice issued to the assessee was during the period when the secretary of the assessee was not available due to his resignation, was not in the knowledge of the assessee and that is the reason why the assessee could not submit the relevant documents before the learned CIT(E) resulting in the rejection of the application, does not appear to be suspicious because the assessee does not stand to gain by such conduct. Further the highest that would happen by allowing an opportunity to the assessee is that a cause could be decided by the learned CIT(E) on merits.
6. With this view of the matter, we set aside the impugned order and restored the application to the file of the learned CIT(E) for considering the same on merits after affording an opportunity of being heralded to the assessee. It is made clear to the assessee that no further opportunity would be granted and it is only now it should cooperate with the learned CIT(E) in disposal of their application.
7. In the result, appeal of the assessee is treated as allowed for statistical purpose.
Order pronounced in the open court on this the 1st day of August, 2024.
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