Rikhavdevji & Kunthunathji Prabhu Jain Vs CIT (Exemption) (ITAT Ahmedabad)
The Income Tax Appellate Tribunal (ITAT) Ahmedabad Bench has set aside an order by the Commissioner of Income Tax (Exemption) [CIT(E)] that rejected a trust’s application for registration under Section 12AB of the Income Tax Act, 1961, and cancelled its provisional registration. The ITAT ruled that the rejection, based solely on procedural non-compliance without an examination of the trust’s activities, violated principles of natural justice.
The case involved Rikhavdevji & Kunthunathji Prabhu Jain, a trust that had initially been granted provisional registration in Form 10AC on September 24, 2021, effective for Assessment Years (AY) 2022-23 to AY 2024-25. The trust subsequently filed an application in Form 10AB for full registration under Section 12A(1)(ac)(iii) of the Act.
The CIT(E) issued notices on May 6, 2024, and June 29, 2024, requesting specific details and documents from the trust. The assessee provided a partial response on July 5, 2024. Following this, a further notice was issued on August 2, 2024, directing the trust to furnish the remaining information by August 8, 2024. However, no additional response was submitted by the trust.
Based on this perceived non-compliance, the CIT(E) proceeded to reject the application for registration and simultaneously cancelled the provisional registration previously granted to the trust.
