SHAD ADAM SHAIKH TRUST,MUMBAI vs. CIT EXEMPTION, MUMBAI

The assessee, Shad Adam Shaikh Trust, stated to be engaged in charitable activities, had filed an application in Form No.10AB on 28.09.2025 under section 80G(5)(ii) of the Act seeking approval under section 80G. On verification of the application, the learned Commissioner noticed that the application was not complete and that all the documents required to accompany the application had not been furnished. Accordingly, a notice dated 14.11.2025 was issued to the assessee requiring it to furnish the complete set of documents as mentioned in Rule 17A(2). In response thereto, the assessee made a submission vide letter dated 24.11.2025 and furnished the relevant details and documents. On examination of the submissions and documents, the learned Commissioner observed that the assessee had not furnished a regular registration certificate under section 12A either in Form No.10AC issued by the CPC, Bengaluru, or in Form No.10AD issued by his office, having validity for a period of five years. The learned Commissioner further observed that his office had also not issued registration under section 12A in Form No.10AD for a period of five years. According to the learned Commissioner, the availability of regular registration under section 12A in Form No.10AC or Form No.10AD was an essential requirement for processing the application for approval under section 80G(5)(ii). Since such regular registration was not available, he held that the application under section 80G(5)(ii) was not tenable and accordingly rejected the application for approval under section 80G.

Being aggrieved by the aforesaid order of the learned Commissioner of Income Tax (Exemptions), the assessee has preferred the present appeal before the Tribunal. During the course of hearing, the learned Authorised Representative (“ld.AR”) appearing for the assessee drew our attention to the order of the coordinate Bench of the Tribunal in ITA No.2129/Mum/2026 dated 22.05.2026 in the assessee’s own case. It was submitted that in the said appeal the issue relating to regularization of the provisional registration under section 12AB of the Act was before the Tribunal and the coordinate Bench, after considering the matter, had set aside the issue to the file of the learned Commissioner of Income Tax (Exemptions) with a direction to consider the matter afresh on merits and in accordance with law. The ld.AR, therefore, submitted that the very foundation on which the approval under section 80G(5) has been rejected, namely, non-availability of regular registration under section 12AB, is presently the subject matter of consideration before the learned Commissioner pursuant to the aforesaid order of the coordinate Bench. It was accordingly submitted that the issue relating to approval under section 80G(5) should also be considered by the same authority after the issue relating to registration under section 12AB is adjudicated.

The learned Departmental Representative (“ld.DR”), on the other hand, relied upon the impugned order passed by the learned Commissioner of Income Tax (Exemptions). He submitted that on the date on which the application under section 80G(5) was considered and decided, the assessee did not possess the requisite regular registration under section 12AB for a period of five years in Form No.10AC or Form No.10AD. Therefore, according to the ld.DR, the learned Commissioner was justified in rejecting the application for approval under section 80G(5), since the statutory requirement on the basis of which the application was required to be examined was not fulfilled at the relevant point of time. It was submitted that the order of the learned Commissioner was therefore correct on the facts as they stood on the date of its passing and deserved to be sustained.

We have heard the rival submissions and perused the material available on record. We have also carefully considered the order passed by the learned Commissioner of Income Tax (Exemptions) as well as the submissions made before us. From the impugned order, it is evident that the application under section 80G(5)(ii) came to be rejected primarily for the reason that the assessee did not have a regular registration under section 12A/12AB in Form No.10AC or Form No.10AD having validity for a period of five years. The learned Commissioner has specifically recorded that the absence of such regular registration rendered the application under section 80G(5)(ii) not tenable. Thus, the question of approval under section 80G(5) is intrinsically connected with the question of the assessee’s regular registration under the provisions relating to section 12AB of the Act.

We further note that the ld.AR has brought to our notice the order of the coordinate Bench in ITA No.2129/Mum/2026 dated 22.05.2026 passed in the assessee’s own case, wherein the issue relating to regularization of the provisional registration under section 12AB was considered and the matter was set aside to the file of the learned Commissioner of Income Tax (Exemptions) for fresh consideration on merits and in accordance with law. Therefore, the issue concerning the assessee’s regular registration under section 12AB is presently before the learned Commissioner for adjudication. This factual position assumes significance because the very reason recorded by the learned Commissioner for rejecting the application under section 80G(5) is the absence of such regular registration. Consequently, the two issues cannot be viewed in isolation in the peculiar facts of the present case. The determination of the assessee’s entitlement to regular registration under section 12AB would have a direct bearing upon the consideration of its application for approval under section 80G(5).

In our considered view, it would therefore be appropriate and in the interest of consistency and substantial justice that both aspects of the assessee’s claim are considered together by the learned Commissioner of Income Tax (Exemptions). The order passed by the coordinate Bench in ITA No.2129/Mum/2026 dated 22.05.2026 has already resulted in the issue relating to regularization of the assessee’s provisional registration under section 12AB being restored to the file of the learned Commissioner. In such circumstances, permitting the impugned order under section 80G(5) to stand independently, solely on 4 the ground that regular registration under section 12AB was not available on the date of passing of the impugned order, may result in the two connected issues being decided at different stages without consideration of their interrelationship. Since the approval under section 80G(5) and the regular registration under section 12AB in the present case arise from the same set of facts and the latter issue is already pending before the learned Commissioner, we find it appropriate to restore the present matter also to his file.

Accordingly, in the interest of substantial justice, we set aside the impugned order passed by the learned Commissioner of Income Tax (Exemptions) rejecting the application of the assessee for approval under section 80G(5) and restore the matter to his file for fresh adjudication. The learned Commissioner shall consider the application of the assessee under section 80G(5) afresh after taking into consideration the outcome of the proceedings relating to regularization of the assessee’s provisional registration under section 12AB, which stands restored to his file pursuant to the order of the coordinate Bench in ITA No.2129/Mum/2026 dated 22.05.2026. The learned Commissioner shall thereafter examine the assessee’s claim for approval under section 80G(5) on its own merits and pass an appropriate order in accordance with law. We make it clear that we have not expressed any opinion on the merits of the assessee’s claim either for registration under section 12AB or for approval under section 80G(5).

The assessee shall fully cooperate with the proceedings before the learned Commissioner of Income Tax (Exemptions) and shall furnish such documents, details and explanations as may be required in support of its claim. The assessee shall also place before the learned Commissioner all relevant material concerning its charitable objects, activities and compliance with the applicable requirements. The learned Commissioner shall afford reasonable opportunity to the assessee and thereafter decide both the connected issues in accordance with law by passing appropriate speaking orders.

In the result, the appeal filed by the assessee is allowed for statistical purposes.