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2019 (7) TMI 603 - HC - Income TaxRectification u/s 154 - exemption u/s 10(23C)(vi) rejected - non affording an opportunity to the petitioner trust to explain - application made by the assessee/trust for review of the rejection order passed by the CCIT, Coimbatore u/s 10(23C)(vi) was rejected - Tribunal opined that there is no error that needs to be rectified and nothing is glaring or apparent on the face of the order to invoke Section 154 - HELD THAT:- We find that both in the first order of rejection dated 24.06.2013 and second order of rejection dated 06.05.2016. The only reason assigned by the CCIT is by stating that the trust deed does not specifically mention that the educational institution established by it, is not running for the purpose of profit. Though the Statute does not specifically contemplate an opportunity of personal hearing on facts, the CCIT could have afforded an opportunity of personal hearing especially, when the assessee has come forward with the plea that the funds are utilized for educational activities and the same is pursued as a charitable activity. Therefore, we hold that there has been violation of principles of natural justice and this is also grant one more ground to interfere with the orders passed by the CCIT, dated 06.05.2016. We find from the order impugned before us that the income and receipts of the assessee from the various institutions run by it have been noted from paragraph 13 of its order. There has been no exercise done by the Department to find out as to whether the assesee/Trust has generated a reasonable surplus to enable them to sustain the institution and in the event of them earning a higher surplus, whether they had ploughed back or utilising the same for achieving the objects of the trust. This exercise ought to have been done at the first instance or at least when the assessee had filed a review petition dated 28.04.2014. Thus, for the above reasons, we are of the considered view that the matter should be remanded back to the CCIT with a direction to examine the entire financials of the assessee and take a decision on merits and in accordance with law.
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