Acharya Sri Tulsi Mahapragya Seva Kendra Charitable Trust Vs CIT (ITAT Bangalore)
No Fair Hearing, No Rejection – 80G Denial Without Show Cause Invalid- Violation of Natural Justice -Tribunal Restores 80G Application of Charitable Trust
The Trust, originally registered in 2000 (later renamed in 2009), holds registration u/s 12AB (from A.Y. 2022-23 to 2026-27). It was also granted provisional approval u/s 80G(5) from 23.03.2022 to A.Y. 2024-25. On 13.08.2024, the Trust applied for final approval u/s 80G(5) in Form 10AB. CIT(E) issued only one notice (30.11.2024), and thereafter rejected the application (25.02.2025) without issuing any final show cause.
CIT(E)’s Grounds for Rejection
- Activities were allegedly not charitable, but in the nature of an AOP benefitting a set of associated persons.
- Trust failed to provide details of buildings & nature of activities.
- Concluded that activities carried on were not genuine charitable activities.
Assessee’s Arguments before ITAT
- Only one hearing was granted; no proper opportunity was given.
- CIT(E) erred in rejecting without issuing a show cause notice—violation of natural justice.
- Trust fully satisfied the conditions u/s 80G(5) and already held 12AB registration & provisional 80G approval.
- Filed additional evidences before ITAT (trust deed, 12AB registration, activity details, affidavits, etc.) seeking admission under Rule 29.
Tribunal’s Findings
- Trust already enjoys 12AB registration & provisional 80G approval; thus genuineness cannot be doubted summarily.
- CIT(E) should have verified documents & activities instead of rejecting outright.
- Admission of additional evidence justified since assessee lacked opportunity earlier.
- At approval stage u/s 80G, CIT(E) must only verify genuineness of activities & compliance of statutory conditions, not step into AO’s shoes to assess income.
- Denial of proper opportunity by CIT(E) was a clear violation of natural justice.
Decision
- Additional evidences admitted by Tribunal.
- Entire issue remitted back to CIT(E) for fresh consideration in accordance with law.
- CIT(E) directed to grant reasonable opportunity of hearing.
- Assessee directed to fully cooperate & submit all documents.
- Appeal partly allowed for statistical purposes
FULL TEXT OF THE ORDER OF ITAT BANGALORE
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