CIT(E) Rejects S. 12AB Claim Citing Related Party Transactions Without Considering Society’s Replies: ITAT Remands Matter for Proper Hearing

The CIT (Commissioner of Income Tax) rejected a claim under Section 12AB of the Income Tax Act, citing related-party transactions without considering the society’s explanations. The ITAT (Income Tax Appellate Tribunal) remanded the matter for proper hearing, instructing the CIT to reconsider the claim. This case highlights the importance of fair consideration of all relevant facts in tax assessments. The tribunal emphasized the need for a complete evaluation of the taxpayer's explanations, especially when related-party transactions are involved, to ensure that due process is followed in the determination of tax liabilities.