The Income Tax Appellate Tribunal (ITAT), Pune bench, directed re-adjudication with respect to discrepancies found in documents produced by the assessee trust for obtaining registration under Section 12AA of the Income Tax Act, 1961. The assessee, Sangli Kutch Jain Seva Samaj, filed an application to obtain registration before the Department, following the requisite form and prescribed procedures for such applications.
The CIT(E), in order to verify the genuineness of the activities and whether the assessee is complying with the relevant laws while carrying out activities as per its objectives, requested certain details from the assessee. Subsequently, the assessee submitted the details in response to the notice, and upon perusal of those documents, the Department identified various discrepancies. Furthermore, the department issued another notice seeking clarification regarding these discrepancies; however, the assessee did not respond. Considering these facts, the CIT(E) rejected the application. Aggrieved by this decision, the assessee filed an appeal before the tribunal.
The Tribunal, while considering the appeal, observed that the application for the registration of the trust was filed by the assessee, and due to a lack of supporting evidence, the Department rejected the matter. The Tribunal further noted that the purpose of the provisions for the registration of trust under Section 12AA and the granting of exemption under Section 80G stems from the Directive Principles of State Policy enshrined in the Constitution of India. These provisions for trust registration and exemption under Section 80G aim to enhance socio-economic welfare in society. After reviewing the facts and records, the two-member bench of Inturi Rama Rao (Accountant Member) and Partha Sarathi Chaudhury (Judicial Member) remitted the matter back to the file of the CIT(E) and directed a de novo adjudication in accordance with the principles of natural justice.