AIC Prestige Inspire Foundation Vs. CIT, Exemption, Bhopal - (Income Tax Appellate Tribunal) (20 Jun 2022)

Rejection of second-application for grant of registration under Section 12AA of the IT Act without mentioning substantial reason amounts to miscarriage of justice

MANU/II/0027/2022

Direct Taxation

The assessee is a company incorporated under Section 8 of the Companies Act, 2013, established for various objects set out in the Memorandum of Association (MOA) filed to the Registrar of Companies which are to set up and run Atal Incubation Centres in partnership with Atal Innovation Mission, Niti Ayog, Government of India; encourage entrepreneurship and innovations, etc. The assessee filed first-application to the Learned CIT(E) for grant of registration under Section 12AA of the Income Tax Act, 1961 (IT Act) but the Learned CIT(E) rejected application vide first-order.

The assessee amended its Memorandum of Association and Articles of Association under the Companies Act, 2013 and removed the objects for which the Learned CIT(E) had raised objection. Thereafter, the assessee filed second-application in Form No. 10A alongwith all required documents for grant of registration. However, vide second-order, the Learned CIT(E) has summarily rejected the second-application of the assessee. Feeling aggrieved by the aforesaid order of Learned CIT(E), the assessee has filed present appeal.

Although there were objections raised by Learned CIT(E) on the first-application of the assessee, yet the assessee has removed those objections before filing second-application. The Learned CIT(E) has rejected second-application of the assessee with the sole reason that there is no change in objects. Except this one reason, the Learned CIT(E) has not mentioned any other reason to reject the second-application.

The Learned AR has successfully submitted that the objectionable objects had already been removed before filing second-application and this submission of Learned AR has not been controverted by the Learned DR. The rejection of second-application for grant of registration under Section 12AA of the IT Act amounts to miscarriage of justice. Therefore, the assessee deserves registration under Section 12AA of the IT Act. Hence, the Learned CIT(E) is directed to grant the registration as applied for by the assessee. Appeal of assessee is allowed.

Tags : APPLICATION REGISTRATION GRANT