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Facts
The assessee trust, which had provisional approval under Section 80G, filed an application for regularization of its Section 80G registration in Form 10AB after both the statutory and extended due dates. The ld. CIT(E) rejected this application primarily due to the delay, leading the assessee to appeal before the Tribunal seeking condonation of the delay.
Held
The Tribunal condoned the 132-day delay in filing Form 10AB, acknowledging 'sufficient cause' and emphasizing a liberal approach to procedural delays, especially when they are mere technicalities and not deliberate. It directed the ld. CIT(E) to deem the application as filed on time and to decide its merits in accordance with the law.
Key Issues
Whether the delay in filing Form 10AB for regularisation of Section 80G registration should be condoned, and whether the ld. CIT(E) was justified in rejecting the application solely on grounds of delay.
Sections Cited
80G, 80G(5)(ii), 80G(5)(vi)
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Income Tax Appellate Tribunal, “F” BENCH, MUMBAI
O R D E R Per Kavitha Rajagopal, J M: This appeal is filed by the assessee, challenging the order of the learned Commissioner of Income Tax (Exemptions), Mumbai (‘ld. CIT(E)’ for short), rejecting the application made by the assessee in form 10AB under clause (ii) of first proviso to sub-section (5) of Section 80G of the Income Tax Act, 1961 (‘the Act'), vide order dated 04.10.2024.
It is observed that the assessee has filed the present appeal with a delay of 132 days beyond the period of limitation for which the assessee has filed an application for condoning the said delay. On perusal of the same, we deem it fit to condone the delay (A.Y. 2025-26) Urmi Foundation for the reason that the assessee had ‘sufficient cause’ for the said delay. Delay condoned.
The assessee has raised the following grounds of appeal: “• That the Learned Commissioner of Income Tax (Exemptions) [hereinafter referred to as "Ld. CIT(E)"] erred in law and on facts in rejecting the application for regularization of the Appellant Trust's registration under Section 80G of the Income-tax Act, 1961 (hereinafter referred to as "the Act"). • That the Ld. CIT(E) erred in rejecting the application on the ground that the Appellant Trust had filed an application in Form 10AB on the date of 03-04-2024, which was rejected due to alleged non-compliance and insufficient record with the Act, without appreciating that the said rejection was not based on a delay in filing or selection of an incorrect section code. • That the impugned rejection order violates the principles of natural justice, as the Appellant Trust was afforded a reasonable opportunity to address any procedural lapses in the earlier application. • That the Ld. CIT(E) failed to consider that the objective of Section 80G is to promote donations to genuine charitable organizations by granting tax benefits to donors, and a procedural lapse should not disqualify a bona fide trust from seeking registration. • That the rejection is arbitrary, unreasonable, and defeats the legislative intent of encouraging charitable contributions and activities through the mechanism of Section 80G.”
4. Brief facts of the case are that the assessee trust has obtained a provisional approval u/s. 80G(5)(vi) dated 24.09.2021 and the date of commencement of the activities of the assessee trust was on 24.04.2012. The assessee trust had filed an application for regularisation of the assessee trust u/s. 80G on 09.10.2024 in form 10AB and the same was rejected by the ld. CIT(E) for the reason that since the assessee has already commenced its activities, the assessee was required to file an application for registration (A.Y. 2025-26) Urmi Foundation within 6 months from the date of the provisional approval which was on 30.09.2023 but the assessee had filed the same belatedly on 09.12.2024.
5. Aggrieved the assessee is in appeal before us, challenging the order of the ld. CIT(E).
We have heard the rival submissions and perused the materials available on record. The only moot issue that requires adjudication is whether the assessee is entitled to registration u/s. 80G when form 10AB was filed by the assessee after the specified due date and also after the extended due date for filing an application in form 10AB. It is observed that the extended due date for filing form 10AB as per CBDT circular no. 07/2024 dated 25.04.2024 was 30.06.2024 were the assessee contends that it had filed form 10AB on 09.10.2024 with a delay of more than 3 months in filing the application for regularization of registration u/s. 80G. It is observed that there is a catena of decision of the Tribunal as well as the Hon’ble High Courts where a liberal view has been taken in case of condoning the delay in filing application for registration in form 10AB. We would place our reliance on the decision of the Hon’ble Delhi High Court in the case of Director of Income-tax (Exemption) vs. Vishwa Jagriti Mission [2013] 30 taxmann.com 41 (Delhi)/[2013] 213 Taxman 65 (Delhi)/[2014] 268 CTR 444 (Delhi)[21-12-2012], where after considering various decisions had laid down the principles that are to be taken into consideration for condoning such delay. We hereby extract the relevant portion of the said order for ease of reference: “22. The following general principles were laid down and it is these principles which guide the Court in approaching the question of condonation of delay: - "And such a liberal approach is adopted on principle as it is realized that: 1. Ordinarily, a litigant does not stand to benefit by lodging an appeal late.
1. (A.Y. 2025-26) Urmi Foundation 2. Refusing to condone delay can result in a meritorious matter being thrown out at the very threshold and cause of justice being defeated. As against this, when delay is condoned, the highest that can happen is that a cause would be decided on merits after hearing the parties. 3. "Every day's delay must be explained" does not mean that a pedantic approach should be made. Why not every hour's delay, every second's delay? The doctrine must be applied in a rational, common sense and pragmatic manner.
When substantial justice and technical considerations are pitted against each other, the cause of substantial justice deserves to be preferred, for the other side cannot claim to have vested right in injustice being done because of a non-deliberate delay.
There is no presumption that delay is occasioned deliberately, or on account of culpable negligence, or on account of mala fides. A litigant does not stand to benefit by resorting to delay. In fact, he runs a serious risk.
6. It must be grasped that the judiciary is respected not on account of its power to legalize injustice on technical grounds but because it is capable of removing injustice and is expected to do so."
From the above, it can be inferred that the Hon’ble High Court has held that a liberal view has to be taken in case of condoning the delay which according to the said decision is a mere technicality which if found genuine has to be decided in favour of the assessee. Even otherwise, the extended due date by the board vide circular no. 07/2024 is also evident that the intention was to provide one more opportunity to the applicant trust for filing the application till 30.06.2024, which rather has not adhered strictly to the stipulated time limit prescribed by the Act.
From the above observation, we deem it fit to extend the assessee with one more opportunity to file the application in form 10AB for regularisation of provisional approval granted to the assessee, before the ld. CIT(E). The ld. CIT(E) is directed to treat the application as being filed on time without any delay and to decide the assessee’s application on the merits and in accordance with law.