Indian Redcross Society Vs CIT(Exemption) (ITAT)
The Indian Red Cross Society, Anand District Branch, filed an appeal before the Income Tax Appellate Tribunal (ITAT) Ahmedabad, challenging the Commissioner of Income Tax (Exemption)’s (CIT(E)) rejection of their application for renewal of approval under Section 80G(5)(iii) of the Income Tax Act, 1961. The society had previously obtained provisional approval which was valid up to Assessment Year 2024-25. In response to their renewal application, the CIT(E) issued a questionnaire and subsequent notice, requesting specific documentation. The Red Cross Society complied, submitting all required documents, including financial statements and activity reports, on August 21, 2024, within the stipulated deadline. However, the CIT(E) rejected the application, citing non-compliance and a failure to demonstrate the genuineness of their activities, without considering the submitted documents.
During the ITAT hearing, the society’s representative argued that the CIT(E) had disregarded the timely submissions, resulting in an erroneous rejection order. They emphasized that the documents were acknowledged by the CIT(E)’s office and requested the matter be remanded for fresh adjudication. The ITAT acknowledged that the society had indeed complied with the CIT(E)’s notice within the given timeframe. The tribunal found that the CIT(E)’s decision to reject the application without examining the submitted documents constituted a violation of natural justice. Consequently, the ITAT set aside the CIT(E)’s order and directed a fresh adjudication, instructing the CIT(E) to consider the society’s submissions and provide an opportunity for a hearing. The ITAT allowed the appeal for statistical purposes.
