RECESS TRUST,MUMBAI vs. CIT(EXEMPTIONS), MUMBAI, CUMBALLA HILL

Ground 3 - The appellant craves leave to add, amend OR alter the above grounds of appeal

on OR before the final date of hearing. ITA No. 4871/MUM/2025

1. Ground 1 - On the facts and circumstances of the case, Commissioner of Income Tax Exemption (Mumbai) (hereinafter referred to as CIT (E)) erred in rejecting the application, even though assessee was duly registered under Income Tax prior to 2021. Such rejection is bad in law and liable to be set- aside before CIT (E) with directions to treat the said application as filed under section 12A(1)(ac) (i) with effect from 01st April, 2021.

2. Ground 2 - Without prejudice to the above, On the facts and circumstances of the case, Commissioner of Income Tax -Exemption (Mumbai) (hereinafter referred to as CIT (E)) erred in rejecting the application, even though activities of the assessee trust has not been doubted. Such rejection is bad in law and liable to be set-aside before CIT (E) with directions to treat the said application as filed under section 12A(1)(ac)(i) with effect from 01st April, 2021.

3. Ground 3 - Without prejudice to the above, on the facts and circumstances of the case and provisions of law, Ld. CIT(E) erred in rejecting the application of assessee for renewal of registration under section 12A(1)(ac) (ii) on the grounds that the assessee has not obtained provisional registration under 12A(1)(ac)(i), even though Registration under 80G was granted. Such rejection of application is bad in law and assessce is liable to be registered under section 12AB w.e.f. 01st April, 2021.

4. Ground 4 - Without prejudice to the above, On the facts and circumstances of the case, Commissioner of Income Tax -Exemption (Mumbai) (hereinafter referred to as CIT (E)) erred in rejecting the application, even though activities of the assessee trust has not been doubted. Such rejection is bad in law and liable to be allowed prospectively with effect from 01st April, 2024.

5. Ground 5-The appellant craves leave to add, amend OR alter the above grounds of appeal on OR before the final date of hearing.”

3. Brief fact of the case are that the assessee trust was constituted on 13.03.2018 with its objects as relief of poor, education and advancement & 71/mum/2025. of general public utility and is registered under Maharashtra public Trust Act 1950. Vide order dated 23.07.2019 of Ld. CIT(E), the assessee was granted registration u/s. 12AA from A.Y. 2019-20. Approval u/s. 80G was also granted vide order dated 30.09.2020. After introduction of the new regime for re-registration of charitable entities introduced by the Finance Act, 2020, the assessee applied for provisional approval u/s. 80G vide application dated 16.08.2021 which was granted vide order dated 24.096.2021 till A.Y. 2024-25. However, the assessee inadvertently omitted to filed application for registration u/s. 12A of the Act. Subsequently, applications for registration under both the sections viz. 12A & 80G were filed on 28.10.2024 in Form 10AB. Both the applications were rejected by ld. CIT(E) vide separate orders dated 23.06.2025 on the ground that the assessee did not apply for re-registration in 2021. In view of the rejection orders, the assessee again applied for registration on 06.10.2025 alongwith an application for condonation of delay. Simultaneously, appeals against the orders of rejection dated 23.06.2025 have also been filed before the Tribunal.

4. Before us, ld. AR has contended that the assessee was enjoying valid registration under the earlier regime. Inadvertently, under a mistaken belief, the assessee omitted to file the application for re-registration in 2021 while application for approval u/s. 80G was duly filed on 16.08.2021. It has been submitted that the omission was purely unintentional and bonafide and ought to have been condoned by ld. CIT(E) keeping in view & 71/mum/2025. the repeated extensions granted by the CBDT for filing the applications for registration/approval under the new regime as well as the power to condone the delay available to ld. CIT(E). Copies of the CBDT circular have also been filed whereby repealed extensions were granted for furnishing of application till 30.06.2024.

Ld. AR has also placed reliance on the decision of the co-ordinate bench in the case of Bombay East Rotary Charitable Trust Vs. ITO in wherein, under similar circumstances, the co- ordinate bench had decided as under:

“5.1. In the interest of justice and fair play, we remit the matter back to the file of ld. CIT(A) to consider the same by condoning the delay which occurred for making a fresh application for availing registration u/s. 12A, which in fact was made and has been granted in Form 10AC though from Assessment Year 2025-26 to Assessment Year 2027-2028 effective from 02.04.2025. Ld. CIT(Exemption) is also directed to consider the condonation of delay, seeking renewal of the registration so as to grant the registration in continuity, covering the Assessment Year 2022-23. Once the delay in obtaining the renewed registration under the amended provisions of section 12A r.w.s.12AB is condoned, the claim of exemption u/s. 11 which has been denied by CPC may be considered on the merits by the ld. CIT(A) for their allowance. For this, the assessee be given reasonable opportunity of being heard to make its submission to justify and substantiate the claim so made. Accordingly, grounds raised by the assessee are allowed for statistical purposes.” In view of above facts and the decision of the co-ordinate bench, ld. AR has submitted that the CIT(E) may be directed to consider the grant of registration w.e.f A.Y. 2022-23 after condoning the delay which was purely unintentional and inadvertent.

Subsequently, on 28.10.2024, the assessee filed separate applications for grant of registration u/s. 12A & renewal of approval u/s. 80G which were rejected vide the impugned orders.

6.2 In view of above stated facts and circumstances, we are of the considered opinion that the assessee was in receipt of registration u/s. 12AA and approval u/s. 80G prior to the introduction of the new regime. Applications filed in October 2024 are delayed by more than 3 months as extended time limit for filing these applications was available till 30.06.2024 only. However, the delay has arisen on accounts of bonafide mistaken belief as noted above and hence the same deserves to be condoned. The assessee has also submitted an application for & 71/mum/2025. condonation of delay on 06.10.2025 alongwith a fresh application for registration.

In light of these facts and respectfully following the decision of the co- ordinate bench in the case of Bombay East Rotary Charitable Trust (supra), we direct the ld. CIT(E) to consider the condonation of delay and decide the application for renewal of registration u/s. 12A and approval u/s. 80G on merits. Needless to add, the assessee should be given a reasonable opportunity of being heard.

Order Pronounced in Open Court on 28.10.2025