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Facts
The assessee, a charitable trust, was granted provisional registration under Section 80G and had been availing its benefits. The assessee filed an application for regular registration, but inadvertently cited the wrong clause and subsequently sought to rectify it. The CIT(E) rejected the application solely on grounds of delay and lack of evidence.
Held
The Tribunal held that the assessee's application was filed within the extended time limit granted by the CBDT, and the subsequent application was a rectification. The CIT(E)'s rejection on technical grounds of delay was set aside.
Key Issues
Whether rejection of an application for registration under Section 80G solely on grounds of a clerical error in citing the clause and delay, without considering the substance, is justified.
Sections Cited
80G, 80G(5), 80G(5)(iii), 10AC
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Income Tax Appellate Tribunal, MUMBAI BENCH “B” MUMBAI
Before: SHRI OM PRAKASH KANT & SHRI NARENDER KUMAR CHOUDHRY
ORDER PER OM PRAKASH KANT, AM
This appeal by the assessee is directed against order dated 26.06.2025 passed by the Ld. Commissioner of Income-tax (Exemption), Mumbai [in short ‘the Ld. CIT(E)’] wherein he has rejected the application of the assessee for seeking approval u/s 80G of the Income-tax Act, 1961 (in short ‘the Act’).
The grounds raised by the assessee is reproduced as under:
In the facts and circumstances of the case and in law, the 1. In the facts and circumstances of the case and in law, the 1. In the facts and circumstances of the case and in law, the leaned CIT (Exemption) erred in not granting registration u/s leaned CIT (Exemption) erred in not granting registration u/s leaned CIT (Exemption) erred in not granting registration u/s 80G[5] of ITA, 1961, and 80G[5] of ITA, 1961, and rejecting the Application for the same rejecting the Application for the same just because a wrong option of fresh certificate was selected just because a wrong option of fresh certificate was selected just because a wrong option of fresh certificate was selected instead of renewal of the said certificate that too without granting instead of renewal of the said certificate that too without granting instead of renewal of the said certificate that too without granting an opportunity rectify the an opportunity rectify the clerical error. 3. Briefly stated, the facts of the case ar Briefly stated, the facts of the case are that the assessee was e that the assessee was granted granted granted provisional provisional provisional registration registration registration in in in Form Form Form No. No. No. 10AC 10AC 10AC dated dated dated 04.04.2022, which remained valid up to the Assessment Year 2024– 04.04.2022, which remained valid up to the Assessment Year 2024 04.04.2022, which remained valid up to the Assessment Year 2024 25, and had been availing the benefit thereof in terms of section 25, and had been availing the benefit thereof in terms of section 25, and had been availing the benefit thereof in terms of section 80G(5)(iii) of the Income 80G(5)(iii) of the Income-tax Act, 1961 (hereinafter referred to as nafter referred to as ‘the Act’). As per law, the assessee was required to file an ‘the Act’). As per law, the assessee was required to file an ‘the Act’). As per law, the assessee was required to file an application for regular registration by October, 2022. The assessee, application for regular registration by October, 2022. The assessee, application for regular registration by October, 2022. The assessee, however, however, however, filed filed its filed its its application application application belatedly belatedly on belatedly on on 02.05.2024 02.05.2024 02.05.2024 for for for registration under section 80G(5), but inadve registration under section 80G(5), but inadvertently mentioned rtently mentioned clause (iv) in place of clause (iii) of sub clause (iv) in place of clause (iii) of sub-section (5) of section 80G. section (5) of section 80G. During the pendency of this application, the assessee sought to During the pendency of this application, the assessee sought to During the pendency of this application, the assessee sought to rectify the mistake by filing another application on 17.12.2024. The rectify the mistake by filing another application on 17.12.2024. The rectify the mistake by filing another application on 17.12.2024. The Learned Commissioner of Income Ta Learned Commissioner of Income Tax (Exemptions) [‘Ld. CIT(E)’], x (Exemptions) [‘Ld. CIT(E)’], however, considered only the application dated 17.12.2024 and however, considered only the application dated 17.12.2024 and however, considered only the application dated 17.12.2024 and rejected the same primarily on the ground of delay. In the impugned rejected the same primarily on the ground of delay. In the impugned rejected the same primarily on the ground of delay. In the impugned order, the Ld. CIT(E) also recorded that the assessee had not filed order, the Ld. CIT(E) also recorded that the assessee had not filed order, the Ld. CIT(E) also recorded that the assessee had not filed evidence substantiating gen evidence substantiating genuineness of its activities as envisaged uineness of its activities as envisaged under clauses (i) to (v) of section 80G(5) of the Act. under clauses (i) to (v) of section 80G(5) of the Act.
We have considered the rival submissions and carefully perused 4. We have considered the rival submissions and carefully perused 4. We have considered the rival submissions and carefully perused the material available on record. It is not in dispute that the Central the material available on record. It is not in dispute that the Central the material available on record. It is not in dispute that the Central Board of Direct Taxes ( Board of Direct Taxes (CBDT), vide letter dated 25.04.2024, CBDT), vide letter dated 25.04.2024, extended the time period for filing applications in Form No. 10AB extended the time period for filing applications in Form No. 10AB extended the time period for filing applications in Form No. 10AB under clause (iii) of the first proviso to section 80G(5) of the Act till under clause (iii) of the first proviso to section 80G(5) of the Act till under clause (iii) of the first proviso to section 80G(5) of the Act till 30.06.2024. In the present case, the assessee filed its application 30.06.2024. In the present case, the assessee filed its application 30.06.2024. In the present case, the assessee filed its application on 02.05.2024, which was well within the extended period of 24, which was well within the extended period of 24, which was well within the extended period of limitation. The subsequent application dated 17.12.2024, in our limitation. The subsequent application dated 17.12.2024, in our limitation. The subsequent application dated 17.12.2024, in our considered view, was only in the nature of a rectification or considered view, was only in the nature of a rectification or considered view, was only in the nature of a rectification or continuation of the application originally filed on 02.05.2024, with continuation of the application originally filed on 02.05.2024, with continuation of the application originally filed on 02.05.2024, with the solitary purpose of purpose of correction of clause number. Therefore, the correction of clause number. Therefore, the conclusion drawn by the Ld. CIT(E) that the assessee’s application conclusion drawn by the Ld. CIT(E) that the assessee’s application conclusion drawn by the Ld. CIT(E) that the assessee’s application was belated cannot be sustained in law. was belated cannot be sustained in law.
The law is well settled that where a statutory authority is vested 5. The law is well settled that where a statutory authority is vested 5. The law is well settled that where a statutory authority is vested with the power to grant with the power to grant or refuse registration, such power has to be or refuse registration, such power has to be exercised in accordance with the statute and having regard to the exercised in accordance with the statute and having regard to the exercised in accordance with the statute and having regard to the substance of the matter rather than the form of application. A mere substance of the matter rather than the form of application. A mere substance of the matter rather than the form of application. A mere clerical error in citing the relevant clause cannot defeat a clerical error in citing the relevant clause cannot defeat a clerical error in citing the relevant clause cannot defeat a substantive right, particularly when the application itself was filed ht, particularly when the application itself was filed ht, particularly when the application itself was filed within the extended time prescribed by CBDT. The rejection of an within the extended time prescribed by CBDT. The rejection of an within the extended time prescribed by CBDT. The rejection of an otherwise valid application on a hyper otherwise valid application on a hyper-technical ground amounts to technical ground amounts to denial of justice and runs contrary to the principle that procedural denial of justice and runs contrary to the principle that procedural denial of justice and runs contrary to the principle that procedural requirements are intended to advance, and not to obstruct, the requirements are intended to advance, and not to obstruct, the requirements are intended to advance, and not to obstruct, the cause of justice.
We accordingly hold that the application dated 02.05.2024, read 6. We accordingly hold that the application dated 02.05.2024, read 6. We accordingly hold that the application dated 02.05.2024, read with its rectification dated 17.12.2024, is within limitation and with its rectification dated 17.12.2024, is within limitation and with its rectification dated 17.12.2024, is within limitation and requires to be considered on merits. The i requires to be considered on merits. The impugned order of the Ld. mpugned order of the Ld. CIT(E) is therefore set aside. The matter is restored to the file of the CIT(E) is therefore set aside. The matter is restored to the file of the CIT(E) is therefore set aside. The matter is restored to the file of the Ld. CIT(E) with a direction to consider the assessee’s application for Ld. CIT(E) with a direction to consider the assessee’s application for Ld. CIT(E) with a direction to consider the assessee’s application for approval under section 80G(5) approval under section 80G(5) afresh, after approval under section 80G(5) afresh, after affording due afresh, after affording due affording due opportunity to the assessee t opportunity to the assessee to furnish evidence in support of o furnish evidence in support of genuineness of its activities in terms of section 80G(5)(i) to (v) of the genuineness of its activities in terms of section 80G(5)(i) to (v) of the genuineness of its activities in terms of section 80G(5)(i) to (v) of the Act, and to decide the same strictly in accordance with law. Act, and to decide the same strictly in accordance with law. Act, and to decide the same strictly in accordance with law.
In the result, the ground raised
by the assessee is allowed for 7. In the result, the ground raised by the assessee is allowed for 7. In the result, the ground raised by the assessee is allowed for in the manner indicated above.” statistical purposes in the manner indicated above.”
In the result, the appeal of the assessee is allowed for In the result, the appeal of the assessee is allowed for In the result, the appeal of the assessee is allowed for statistical purposes.