MEWARI TOLLY CHARITABLE TRUST,MUMBAI vs. COMMISSIONER OF INCOME TAX (EXEMPTIONS), MUMBAI

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ITA 4337/MUM/2026Status: DisposedITAT Mumbai18 August 2026AY 2026-275 pages
AI SummaryRemanded

What did the Tribunal hold?

The ITAT held that since the basis for rejecting the 80G application (rejection of 12AB registration) no longer survived due to a subsequent ITAT order directing 12AB registration, the 80G application needed fresh consideration. The CIT(E) was directed to re-examine the 80G application on its merits.

What were the facts?

The assessee's application for approval under Section 80G was rejected by the CIT(E) solely because its application for registration under Section 12AB was rejected. The assessee had challenged the 12AB rejection before the ITAT.

What were the issues?

Whether the rejection of an application for approval under Section 80G is sustainable when the sole ground for rejection, the denial of registration under Section 12AB, has been overturned by a higher tribunal.

Which sections of the Income-tax Act were involved?

Section 80G,Section 12AB,Section 12A(1)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “C” BENCH MUMBAI

Before: SHRI SAKTIJIT DEY & SHRI MAKARAND VASANT MAHADEOKAR

For Appellant: Shri Pratik Jain
For Respondent: Shri Rajdeep Singh, CIT DR
Hearing: 24.07.2026Pronounced: 19.08.2026

आदेश / ORDER PER MAKARAND VASANT MAHADEOKAR, AM:

This appeal is filed by the assessee against the order dated 11.02.2026 passed by the learned Commissioner of Income Tax (Exemptions), Mumbai [“CIT(E)”], rejecting the assessee’s application in Form No. 10AB seeking approval under section

2 ITA No. 4337/Mum/2026 Mewari Tolly Charitable Trust 80G of the Income-tax Act, 1961 (“the Act”), for the assessment year 2026-27.

2.

The assessee has raised the following grounds of appeal:

1.

On the facts and circumstances of the Appellant’s case and in law, the Ld. CIT(Exemptions) has erred in rejecting the application made by the applicant for renewal of exemption u/s 80G of the Income Tax Act, 1961, for the reasons mentioned in the impugned order or otherwise. 2. The Appellant craves leaves to alter, amend, withdraw or substitute any ground or grounds or to add any new ground or grounds of appeal on or before the hearing.” 3. Briefly stated, the assessee filed an application in Form No. 10AB on 29.09.2025 seeking approval under section 80G of the Act under clause (ii) of the first proviso to section 80G(5) of the Act. The assessee had also filed a separate application in Form No. 10AB on 29.09.2025 seeking registration under section 12AB of the Act under sub-clause (ii) of clause (ac) of section 12A(1) of the Act.

4.

The learned CIT(E), by a separate order dated 11.02.2026, rejected the assessee’s application for registration under section 12AB of the Act. On that basis, the learned CIT(E) observed that the assessee did not satisfy the condition prescribed under section 80G(5)(i) of the Act. The learned CIT(E), therefore, held that the assessee’s application seeking approval under section 80G had become untenable and rejected the same by the impugned order dated 11.02.2026.

3 ITA No. 4337/Mum/2026 Mewari Tolly Charitable Trust 5. Aggrieved, the assessee is in appeal before us. 6. Before us, the learned Authorised Representative submitted that the order rejecting the assessee’s application for registration under section 12AB of the Act had been challenged before the Tribunal in ITA No. 4336/Mum/2026and the coordinate Bench, has heard the matter and indicated either to restore the matter to the file of learned CIT(E) or to direct to grant the registration. It was, therefore, submitted that the sole foundation upon which the application under section 80G had been rejected no longer survives and that the matter may be restored to the learned CIT(E) for fresh consideration. 7. The learned Departmental Representative raised no objection to the restoration of the matter to the file of the learned CIT(E). 8. We have heard the rival submissions and perused the material placed before us. The limited controversy arising in the present appeal is whether the rejection of the assessee’s application seeking approval under section 80G can be sustained after the Tribunal has directed the learned CIT(E) to grant registration under section 12AB of the Act. 9. On a perusal of the impugned order, we find that the learned CIT(E) rejected the assessee’s application under section 80G solely on account of the rejection of its application for registration under section 12AB. The learned CIT(E) did not

4 ITA No. 4337/Mum/2026 Mewari Tolly Charitable Trust examine the assessee’s eligibility for approval under section 80G on any other ground. 10. The assessee challenged the rejection of its application for registration under section 12AB before the Tribunal in ITA No. 4336/Mum/2026. The Co-ordinate Bench, in paragraph 11 of its order, directed as under: “Thus, respectfully following the decision of the Hon’ble Supreme Court in the case of Ananda Social and Educational Trust vs. CIT (supra) and the decision of the Chennai Tribunal in the case of Sir C.V. Raman Educational & Charitable Trust vs. CIT(E) (supra), we direct the learned CIT(E) to grant registration u/s 12AB of the Act to the assessee-Trust.” 11. Thus, the very basis upon which the learned CIT(E) rejected the assessee’s application under section 80G does not survive. At the same time, approval under section 80G requires examination of the independent conditions prescribed under that provision. As no such examination was undertaken by the learned CIT(E), it would be appropriate to restore the application to his file for fresh consideration.

12.

Accordingly, we set aside the impugned order dated 11.02.2026 and restore the assessee’s application in Form No. 10AB to the file of the learned CIT(E). The learned CIT(E) is directed to decide the application afresh on its own merits and in accordance with law, after taking into consideration the registration granted, or required to be granted, to the assessee under section 12AB pursuant to the order of the Tribunal in ITA No. 4336/Mum/2026. The learned CIT(E) shall examine the

5 ITA No. 4337/Mum/2026 Mewari Tolly Charitable Trust assessee’s compliance with the remaining conditions prescribed under section 80G and pass a reasoned order after affording the assessee a reasonable opportunity of being heard. The assessee is also directed to furnish the requisite documents and explanations and to cooperate in the proceedings.

13.

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

Order pronounced in the open court on 19.08.2026.

Sd/- Sd/- (SAKTIJIT DEY) (MAKARAND VASANT MAHADEOKAR) VICE PRESIDENT ACCOUNTANT MEMBER Mumbai, Dated 19.08.2026 ANKIT, PS

आदेश की प्रतितिति अग्रेतिि/Copy of the Order forwarded to : 1. अपीलाथी / The Appellant 2. प्रत्यथी / The Respondent. 3. संबंधधत आयकर आयुक्त / The CIT(A) 4. आयकर आयुक्त(अपील) / Concerned CIT धिभागीय प्रधतधनधध, आयकर अपीलीय अधधकरण, मुम्बई/ DR, ITAT, Mumbai 5. 6. गार्ड फाईल / Guard file.

आदेशानुसार/BY ORDER, सत्याधपत प्रधत //True Copy// 1. उि/सहायक िंजीकार ( Asst. Registrar) आयकर अिीिीय अतिकरण, मुम्बई / ITAT, Mumbai

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