INCOME TAX APPELLATE TRIBUNAL AHMEDABAD ‘’D” BENCH – AHMEDABAD

ITA No.1721/Ahd/2015
New Model Foundation (Appellant) vs. CIT (Exemption) (Respondent)
Date of Judgment: 11-01-2016

ORDER

PER Manish Borad, Accountant Member.
This is an appeal filed by the assessee against the order dated 21.04.2015 passed by CIT(Exemption), Ahmedabad. The grounds raised by the assessee are as under :-

1. The ld. Director of Income-tax (Exemption) has grievously erred in law and on facts in not granting approval u/s 80G of the I.T. Act to the appellant Trust without properly appreciating the facts in its proper perspective.

2. He has erred in law and on facts in not granting approval u/s 80G of the IT Act. Without considering the relevant factors as per the law and basing his order on irrelevant considerations.

3. He has erred in law and on facts in rejecting the application in form no.10G for approval u/s 80G(5) of the Act without appreciating the fact that the query letter dated 01/11/2014 could not be responded on account of un-avoidable circumstances whereas most of the details required stood furnished.

4. On the facts the appellant Trust ought to have been granted registration/approval u/s 80G of the IT Act, 1961.

5. The appellant craves leave to add to alter and/or to modify any ground of appeal.

2. Briefly stated facts are that the assessee filed application seeking exemption under section 80G(5) of the Income Tax Act, 1961 (hereinafter referred to as “the Act”). The said application was rejected by the CIT(Exemption) by observing as under:

“4. Therefore, with a view to give one more opportunity of being heard to the applicant, another letter marked ‘Final Opportunity’ was issued to the applicant trust on 10/03/2015 requiring the details/documents as mentioned therein on or before 01.04.2015. It was stated without any ambiguity in the said letter that failure to comply with the said letter will entail rejection of its application under reference. The said letter was returned back from postal authority with remark “not known”. The letter was sent to the address written on form no.10G. This letter also failed to evoke any response from the applicant. Therefore, in the absence of complete details/documents, it is not possible to satisfy about the genuineness of the activities of the above trust or the same being carried out in accordance with the objects of the trust.

5. Looking to the above facts, I am unable to arrive at the satisfaction of the genuineness of the activities. Hence, the application filed in Form No.10G for the approval u/s 80G(5) of the Income-tax Act, is rejected.”

3. The assessee, being aggrieved by the order of the CIT(Exemption) has preferred the present appeal before the Tribunal.

4. The learned counsel for the assessee submitted that the trust is registered u/s 12AA of the IT Act and the certificate of registration is placed on record. He submitted that all the requisite details were filed before the CIT(Exemption), but as counsel for the assessee could not appear in the proceedings before the CIT(Exemption) due to nonreceipt of notice / letter which was returned back by postal authorities, the CIT(Exemption), rejected the application.

5. On the contrary, the learned DR supported the order of the CIT(Exemption). He submitted that there is no illegality in the order of the ld.CIT(Exemption).

6. We have considered submissions of the both the parties and perused the order of the authority below. There is no dispute with regard to the fact that on 10.03.2015 a letter was issued to the applicant-trust to furnish certain documents and appear before the ld. CIT(Exemption) and the ld. CIT(Exemption) has recorded that the said letter was returned back from postal authority with remark “not known”. This letter also failed to evoke any response from the applicant. Therefore, in the absence of complete details/documents, it is not possible to satisfy about the genuineness of the activities of the above trust or the same being carried out in accordance with the objects of the trust. The contention of the learned counsel for the assessee is that the query letter dated 01/11/2014 could not be responded due to un-avoidable circumstances but most of the details required stood furnished. He drew our attention to the detailed paper book containing 28 pages wherein it is stated that the documents were enclosed. Under these circumstances, we are of the considered view that the application under section 80G(5) of the applicant is required to be restored to the file of ld. CIT(Exemption) for decision afresh, on the basis of the documents placed on record. Accordingly, we hereby set aside the impugned order of ld.CIT(E) and restore the application of the assessee to his file for decision afresh. The assessee is directed to furnish the documents before the ld. CIT(Exemption) for deciding the issue afresh. After taking the copy of this order, the assessee is directed to approach ld. CIT(Exemption) suo moto, and on receipt of this order, ld. CIT(Exemption) is to decide the application of the applicant afresh. Thus, the grounds of the appeal of the assessee are allowed as indicated above.

7. In the result, the appeal of the assessee is allowed for statistical purpose.

Order pronounced in the open Court on 11 January, 2016

(Rajpal Yadav)              (Manish Borad)  
Judicial Member           Accountant Membe