Sadhu Sundar Singh Welfare Society vs CIT(Exemption), Exemption Ward 2(1)

PER RAMIT KOCHAR, AM:

This appeal is filed by the assessee against order u/s 12AB(1)(b)(ii)(B) of the Income-tax Act, 1961(hereinafter called “the Act”) passed by Learned Commissioner of Income Tax (Exemptions), Delhi [CIT(E), in short) dated 30.01.2024( DIN& Notice No. ITBA/EXM/F/EXM45/2023-24/1060251407(1), rejecting application filed by the assessee for seeking registration u/s 12A(1)(c)(iii) of the 1961 Act .

At the outset, it is observed that this appeal is filed belatedly by the assessee beyond the time stipulated u/s 253(3) of the 1961 Act , by 706 days. The assessee has filed an affidavit dated 03.01.2026 , wherein it is averred that the assessee is a society registered under the Societies Registration Act, 1860 , and it came into existence of 11.09.1991. It is averred that the project run by is in the name of ‘Bal Vihar’. It is claimed by the assessee that the assessee is providing free education , food , shelter , medical facilities to orphan (girls) . It is claimed that these girls comes to the assessee through Department of Women and Child Development, Government of NCT of Delhi. It is claimed that the assessee is holding license issued by Government of Delhi. It is also claimed that the assessee is not claiming any financial support from Local/Central Government, and rather all the expenses are met through donations made by VETERNS OF INDIAN ARMED FORCES and general public. It is claimed that presently there are thirty-five girls starting from age 5 years till 17 years. It is claimed that the assessee was granted registration u/s 12A dated, 23.01.2012. It is claimed by the assessee that the assessee is regularly getting its accounts audited and filing of income tax returns. It is claimed that the assessee applied for registration u/s 12A(1)(ac)(iii) on 26.08.2023 , and duly filed replies before ld. CIT(E), but the same were ignored and the application of the assessee was rejected by ld. CIT(E). It is stated in the said affidavit that the assessee has filed this appeal belatedly, and prayers were made to condone the delay. The reasons for filing this appeal belatedly is stated to be lack of proper legal/professional guidance. Further , it is stated that the assessee applied for new PAN as the assessee existing PAN AAETS6445H has fourth alphabet ‘T’ while it should have been ‘A’ as it stand for AOP. It is claimed that the assessee was allotted new PAN ABDAS1959F. It is claimed that with new PAN, the assessee filed for registration u/s 12A , which stood granted by LD. CIT(E) on 23.03.2022, for ay’s: 2022-23 to 2026-27. It is claimed that later the assesse realized that registration for ay: 2021-22 was also to be applied with , which assessee applied on 26.08.2023. This application stood rejected by ld. CIT(E) vide orders dated 30.01.2024. It is claimed that the delay is neither willful nor deliberate, but occurred due to lack of proper understanding of the statutory provisions. It is claimed that severe prejudice shall be caused , if the delay is not condoned. The Revenue objected to the condonation. After hearing both the parties and going through the content of condonation affidavit, we condone the delay of 706 days in filing this appeal belatedly by the assessee beyond the time prescribed u/s 253(3) of the 1961 Act, and proceed to adjudicate this appeal on merits in accordance with law. When substantial justice is pitted against technicalities, the Courts will lean towards advancement of substantial justice, unless malice is at writ large. We donot see any malice on the part of the assessee in filing this appeal belatedly beyond time prescribed u/s 253(3) , as the assessee is not likely to gain any thing by filing this appeal belatedly by 706 days beyond the time prescribed u/s 253(3). Reliance is placed on judgment and order of Hon’ble Supreme Court in the case of Collector , Land Acquisition , Anantnag v. Mst. Katiji & Ors. 1987 (2) SCC 107.

Brief facts of the case are that assessee has filed an application dated 26.08.2023 in Form No.10AB for registration u/s 12A (1)(ac)(iii) of the 1961 Act, before learned CIT(E). The Ld. CIT(E) issued questionnaire dated 12.10.2023 to the assessee with the request to furnishing certain details ,document and/or clarification in support of the claim of the registration u/s 12A(1)(ac)(iii) of the Act. The assessee has claimed before the Bench that it duly filed reply dated 26.10.2023 before ld. CIT(E) (assessee has filed covering page which is placed in File/Annexure-C/Page 24) , but ld. CIT(E) did not consider the reply . On careful perusal of the said reply , it is observed that this reply is in context of new PAN ABDAS1959F (claimed to be allotted to the assessee), while application dated 26.08.2023 was made wrt old PAN AAETS6445H . The ld. CIT(E) observed that the assessee did not file reply in response to notice. The ld. CIT(A) granted two more opportunities to the assessee, but again there was no compliance by the assessee. The ld. CIT(E) vide order dated 30.01.2024 passed in Form No. 10AD rejected the application of the assessee for seeking registration u/s 12A(1)(ac)(iii) of the 1961 Act, on the grounds that the assessee has failed to submit the requisite details/evidences.

Aggrieved, the assessee has filed appeal before the Tribunal. The Ld. Counsel for the assessee along with Wg Cdr. K. L. Kapoor , Director of the assessee appeared before the Bench. They reiterated before the Bench activities of the assessee which are enumerated in the affidavit filed(details extracted in para 2 above), which are not repeated again for sake of brevity. At the outset submitted ld. Counsel for the assessee submitted that ld. CIT(E) did not give proper and adequate opportunity of being heard to the assessee . It was submitted that ld. CIT(E) dismissed the aforesaid application filed by the assessee ex-parte without considering the reply filed by the assessee before ld. CIT(E), and prayers were made to restore the application before ld. CIT(E) for denovo determination of the application for grant of registration u/s 12A(1)(ac)(iii) on merits in accordance with law after providing opportunity of being heard to the assessee.

We have considered rival contentions and perused the materials available on record, which are culled out in preceding para’s of this order and are not repeated again for sake of brevity. The assessee has filed application with ld. CIT(E) for grant of registration u/s 12A(1)(ac)(iii), dated 26.08.2023 . The ld. CIT(E) issued notice along with questionnaire, dated 12.10.2023 to the assessee. The assessee has claimed that it filed reply dated 26.10.2023 before ld. CIT(E) , but the same was not considered by ld. CIT(E)(Page 24/Annexure-C) . It is observed that this reply mentioned new PAN claimed to be allotted in favour of the assessee, and not the old PAN under which application for registration u/s 12A(1)(ac)(iii) was filed by the assessee. The ld. CIT(E) has observed that the assessee did not file any reply/response to its notice. Be it may be so, the ld. CIT(E) gave two more opportunities to the assessee, but again there was no reply from the assessee. The ld. CIT(E) dismissed aforesaid application for registration u/s 12A(1)(ac)(iii) vide order dated 30.01.2024 . Both the parties are ad-idem, that matter can be restored back to the file of ld. CIT(E) for fresh determination of application for registration u/s 12A(1)(ac)(iii). The Director of the assessee Wg. Cdr K L Kapoor stated before the Bench, that the assessee will submit all necessary details/documents as may be called by ld. CIT(E) for determination of the application for registration filed by the assessee, in denovo proceedings. Keeping in view facts and circumstances of the case and in the interest of justice and fairness to both parties, we are of the considered view that end of the justice will be met to send back the matter back to the file of the ld. CIT(E) for denovo determination of the application of the assessee , dated 26.08.2023 filed for seeking registration u/s 12A(1)(ac)(iii) of the 1961 Act. We clarify that we have not commented on the merits of the issues in the appeal, and the ld. CIT(E) shall pass orders on merits in accordance with law, after affording opportunity of being heard to the assessee. The assessee is directed to co-operate in the set aside remand proceedings to be conducted by the ld. CIT(E), otherwise the ld.CIT(E) shall be free to pass orders in accordance with law on merits. All the contentions are kept open. The orders of the ld. CIT(E) , dated 30.01.2024 is set aside and the matter is restored back to the file of the ld. CIT(E) for denovo determination of the aforesaid application on merits in accordance with law after giving opportunity of being heard to the assessee. Evidences/ contentions filed by the assessee before the ld. CIT(E) shall be admitted by the ld. CIT(E) and shall be decided on merits in accordance with law. The ld. CIT(E) will also address to the contentions of the assessee wrt holding of two PAN whether or not it was obtained for genuine reasons and accordingly consequences thereof so far as seeking aforesaid registration. The appeal of the assessee is allowed for statistical purposes. We order accordingly.

In the result, the appeal filed by the assessee is allowed for statistical purposes.