Deep Shikha Vikas Samiti Vs CIT(E) (ITAT Jodhpur)
Jodhpur ITAT: 12AB/80G Applications Should Not Fail for Curable Procedural Lapses – Remand Cannot Become an Unrestricted Fresh Enquiry
In a consolidated order covering 48 appeals of charitable trusts/institutions, the Jodhpur ITAT dealt with rejection of registration under Sections 12A/12AB and approval under Section 80G on recurring grounds such as absence of Rajasthan Public Trust registration, failure to establish genuineness, defective Form 10AB and non-compliance with notices.
The Tribunal held that where registration under the Rajasthan Public Trust Act, 1959 was subsequently obtained, the very deficiency underlying rejection stood cured. The CIT(E) should verify the certificate and, if valid and no other recorded statutory impediment survives, grant registration under Section 12AB. Significantly, the remand cannot be converted into an unrestricted de novo enquiry on grounds never forming part of the original rejection.
Where State registration had already been applied for but was still pending, the trust should be permitted to produce it once issued rather than being compelled to start the entire 12AB process afresh merely because another statutory authority had not completed its proceedings.
On genuineness of activities, the ITAT drew an important distinction between a positive finding that activities are “not genuine” and a mere failure to “establish genuineness” because of inadequate documentation. The latter cannot automatically be treated as proof of non-genuineness. CIT(E) must examine the primary evidence and, before relying on adverse material, confront the assessee and provide an effective opportunity of rebuttal.
