Dnyanagan Education Society Vs CIT Exemption (ITAT Pune)
Dnyanagan Education Society, a trust, applied for registration under Section 12A(1)(ac)(iii) of the Income Tax Act by submitting Form No. 10AB on September 29, 2023. The Commissioner of Income Tax (Exemptions) issued notices via the ITBA portal to verify the trust’s genuineness, but discrepancies were identified in its submissions. A final notice on February 29, 2024, required the trust’s response by March 7, 2024. The trust failed to meet this deadline, leading to the rejection of its application. In its appeal to the Income Tax Appellate Tribunal (ITAT), the trust argued that it was not granted a reasonable opportunity to respond, requesting the case be remanded for fresh consideration.
ITAT Pune acknowledged that the trust was given less than a week to comply, contrary to the Central Board of Direct Taxes’ guidelines mandating a minimum 15-day response time for notices under Section 142(1). Citing the Delhi High Court’s precedent in the Dauphin Travel Marketing Pvt. Ltd. case, ITAT held that the insufficient response time violated principles of natural justice. Consequently, ITAT deemed the CIT (Exemptions)’s approach unfair and remanded the case for fresh evaluation, ensuring compliance with the law. The decision emphasizes procedural fairness in tax proceedings.
