DEEPIKA CHARITABLE EDUCATIONAL TRUST,BANGALORE vs. CIT(EXEMPTION), BANGALORE

At the outset, it was noticed that assessee has filed appeal before the Tribunal with a delay of 113 days. Explaining the reasons for belated filing of the appeal, the Ld.

On perusal of the contents of the affidavit filed by the assessee as well as the submission of the Ld. AR, we find that the assessee is prevented by a reasonable and sufficient cause in filing the appeal beyond the prescribed time limit with a delay of 90 days. Therefore, we hereby condone the delay of 90 days in filing the appeal before the Tribunal and proceed to adjudicate the appeal on merits in the following paragraphs.

Brief facts of the case are assessee filed application in Form 10AB dated 29.04.2025 seeking registration under 12A(1)(ac)(iii) of the Act. The Trust has obtained provisional registration under section 12A of the Act in Form 10AC which is valid from Assessment Year 2025-26 to 2027-28. The learned CIT(E) noticed that assessee sought permanent registration, has filed Form 10AB under 12A(1)(ac)(ii) of the Act. The learned CIT(E) noticed that assessee has selected a wrong section code while applying Form 10AB for registration under section 12A of the Act. He therefore rejected the application for registration.

On being aggrieved by the Order of the learned CIT(E), the assessee is in appeal before us by raising the following grounds of appeal:

The only grievance emanating from the above grounds is rejection of registration under section 12AB of the Act by learned CIT(E). On this issue, the learned AR submitted that the assessee while filing Form 10AB has inadvertently quoted wrong clause and the assessee sought to apply for permanent registration under 12AB while filing Form 10AB wherein the correct clause was quoted by the assessee. However, the learned CIT(E) rejected the application for seeking permanent registration u/s 12A(1)(ac)(ii) of the Act, citing that the assessee has quoted 12A(1)(ac)(iii) of the Act during its application for provisional registration. The learned AR further submitted that this being an inadvertent clerical error while making the application online, an opportunity must be provided to the assessee to correct the clerical error and apply afresh with the correction of correct clause. He therefore pleaded that one more opportunity may be provided to the assessee to correct the technical / clerical error.

Per contra, the learned DR relied on the relied on the impugned Order and submitted that learned CIT(E) is justified in rejecting the application due to incorrect quoting of provisions.

We have heard the rival contentions and perused the material available on record. The assessee has filed Form 10AB seeking registration under section 12A of the Act. The only basis for rejection by the learned CIT(E) is due to the fact that the assessee has quoted wrong section 12A(1)(ac)(iii) instead of 12A(1)(ac)(ii) while filing the Form for provisional registration. It is being a mere technical and procedural lapse, the substance of the application cannot be disregarded solely on such ground. It is also well settled principle that procedural mistake should not defeat the substantial rights especially in cases involving registration of charitable institutions which otherwise meet the conditions stipulated under the Act. The Hon’ble Supreme Court in the case of CIT v. G.M.Mittal Stainless Steel (P) Ltd. [263 ITR 255 (SC)] has held the procedural lapses should not come in the way of granting substantive relief, provided the assessee is otherwise eligible. Various judicial pronouncements have held that the procedural defects or clerical errors should not defeat the substantive rights particularly in the context of welfare and beneficial legislations like Registration 12A of the Act. Therefore, rejection of the application without affording opportunity to rectify the error is not in consonance with the principles of natural justice. In view of the foregoing, we hold that the rejection of the assessee application is not justified and therefore we set- aside the impugned order and restore the matter to the file of the learned CIT(E) with a direction to examine the assessee’s application on merits after allowing the assessee to rectify the procedural errors. Ld.CIT(E) shall dispose of the application afresh after giving due opportunity of hearing to the assessee. Thus, the appeal is allowed for statistical purposes.

In the result, appeal is allowed for statistical purposes.