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2018 (12) TMI 917 - AT - Income TaxApplication for registration u/s 12AA denied - proof of charitable activity - the assessee trust has been notified under the Hindu Religious Institutions and Endowments Act, 1997; as also the Executive Officer is appointed thereunder - assessee has not been provided adequate and reasonable opportunity - Held that:- As relying on Kokkada Shree Southadka Mahaganapthi Temple Vs. CIT(E) [2016 (10) TMI 350 - ITAT HYDERABAD] the first reason given by the CIT(E) for rejecting the assessee’s application for registration by saying that the trust is a Temple administered by the Endowment Department of the Government of Karnataka is incorrect and the same is rejected, being devoid of any merit. After the assessee filed its application for registration u/s 12AA of the Act, on 07.11.2016, the office of the CIT(E) awoke to the existence of the assessee’s application after more than 5 months later by issue of letter dated 28.04.2017 calling for details from the assessee, based in a mofussil area far away from Bangalore to file details by 15.05.2017. The assessee was afforded this one opportunity only and the CIT(E), after no apparent action for more than 5 months from the date of the assessee’s application for registration u/s 12AA dated 07.11.2016; in less than a month proceeded to call for details, examine them and reject the assessee’s application ex-parte vide order dated 22.05.2017 - apparent reason for this hurried disposal of the assessee’s application by CIT(E) with undue haste was because as per section 12AA(2) of the Act, order for grant or rejection of registration was to be passed before the expiry of 6 months from the end of the month in which the application for registration was received; i.e., in the case on hand the CIT(E) was bound to pass the order on or before 31.05.2017. The proviso to section 12AA(1) of the Act clearly provides that no order under sub clause (ii) of clause (b) of section 12AA(1) shall be passed unless the applicant has been given reasonable opportunity of being heard. The facts as emanate from the record in the impugned order clearly shows that the assessee in the case on hand was not afforded reasonable opportunity of being heard - thus set aside the impugned order and restore the matter of the assessee – trust’s application for registration back to the file of the CIT(E) for fresh examination - decided in favour of assessee for statistical purposes.
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