Mumbai Sogetsu Association Vs ITO (ITAT Mumbai)
Mumbai ITAT: Newly Incorporated Charitable Institution Cannot Be Denied 12AB Registration Merely for Limited Initial Activities; Fresh Opportunity Directed
The Mumbai ITAT set aside the orders rejecting registration under section 12AB and approval under section 80G(5) in the case of a newly incorporated Section 8 company. The Tribunal held that where a charitable institution was incorporated only shortly before filing Form 10AB, the Commissioner (Exemptions) ought to examine the charitable objects, activities undertaken from the date of incorporation, receipts, application and accumulation of income, rather than insist upon details for periods when the entity was not even in existence. The Tribunal also noted that the assessee had received initial donations, commenced charitable activities, incurred establishment expenses, filed Form 10 for accumulation of income, and alleged that no specific show-cause notice proposing rejection had been issued. Holding that adequate opportunity had not been afforded and that these relevant aspects remained unexamined, the ITAT restored both the 12AB registration and the consequential 80G approval applications to the file of the CIT(E) for de novo adjudication after granting a proper opportunity of hearing, without expressing any opinion on the merits of the claim.
FULL TEXT OF THE ORDER OF ITAT MUMBAI
