HEAL THE HEART FOUNDATION,MUMBAI vs. CIT(EXEMPTION), MUMBAI

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ITA 1996/MUM/2026Status: DisposedITAT Mumbai31 July 2026AY 2026-278 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal condoned the delay in filing the appeals, finding the assessee's explanation to be bona fide. It held that the CIT(E) did not properly appreciate the evidence regarding the commencement of activities or the implications of the Memorandum of Association.

What were the facts?

The assessee, Heal the Heart Foundation, applied for registration under section 12AB and approval under section 80G(5). The applications were rejected by the CIT(E) due to delay in filing and a perceived issue with the Memorandum of Association.

What were the issues?

Whether the CIT(E) was justified in rejecting the applications for registration and approval due to delay and issues with the Memorandum of Association, and whether the delay in filing the appeals should be condoned.

Which sections of the Income-tax Act were involved?

Section 12AB,Section 80G(5),Section 253(5)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, MUMBAI BENCHES, MUMBAI

Before: SMT. BEENA PILLAI, HON’BLE & SHRI VIKRAM SINGH YADAV, HON’BLE

For Respondent: Shri Ankur Alya, CIT DR
Pronounced: 31/07/2026

आयकर अपील�य अ�धकरण, मुंबई पीठ�, मुंबई INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES, MUMBAI BENCH: E BEFORE SMT. BEENA PILLAI, HON’BLE JUDICIAL MEMBER AND SHRI VIKRAM SINGH YADAV, HON’BLE ACCOUNTANT MEMBER

ITA 1996 & 1995/MUM/2026 िनधा�रण वष�/Assessment Year: 2026-27) HEAL THE HEART CIT(EXEMPTION) FOUNDATION ROOM NO. 601, 6TH 602, SEA BREEZE CO FLOOR, CUMBALLA HILL OPERATIVE SOCIETY MTNL BUILDING TOWER, 2 SECTOR, 16, PEDDER ROAD, DR. Vs. NERUL NODE III, NAVI GOPALRAO DESHMUKH MUMBAI-400706, MARG, CUMBALLA HILL MAHARASHTRA MUMBAI-400026, MAHARASHTRA अपीलाथ� Appellant ��थ� Respondent

Permanent Account Number of AAGCH3694A Assessee:

अपीलाथ� �ारा/Appellant represented by: Shri Nilesh Kariya, AR ��थ� �ारा/Respondent represented by: Shri Ankur Alya, CIT DR

सुनवाई की तारीख / Date of conclusion of hearing: 13-Jul-2026 घोषणा की तारीख / Date of pronouncement: 31/07/2026 आदेश / ORDER PER SMT. BEENA PILLAI, JUDICIAL MEMBER:

These appeals are directed against the separate orders passed by the Learned Commissioner of Income-tax (Exemptions) [Ld. CIT(E)] even dated 28/09/2025, whereby the application of the assessee for grant/renewal of registration under section 12AB and the application for grant/renewal of approval under section 80G(5) of the Act, respectively, came to be rejected.

2.

Since the issues involved in both the appeals arise out of the same set of facts, pertain to the same assessee and were heard together, they are being disposed of by this consolidated order for the sake of convenience and brevity.

3.

At the outset, we note that there is a delay of 85 days in filing the present appeals before the Tribunal. The assessee has filed a petition for condonation of delay supported by a duly sworn affidavit explaining the reasons for the delay. The assessee has stated that the email communicating the impugned order had inadvertently remained in the spam folder of the registered email account and, therefore, escaped his notice. It has further been stated that during the relevant period, the assessee was preoccupied with time-bound statutory compliances relating to the audit report and filing of the return of income. The affidavit further explains that the delay in filing the application for regular registration arose due to a bona fide misunderstanding of the statutory provisions, as the assessee was under the belief that the application for regular registration was required to be filed within six months from the commencement of its activities. Immediately upon becoming aware of the rejection order and the correct legal position, the assessee took prompt steps to file the present appeals.

It has been categorically affirmed that the delay was neither intentional nor deliberate and was not occasioned by any mala fide motive.

3.1. The averments made in the affidavit have not been controverted by the Revenue by placing any material on record. It is well settled that while considering an application for condonation of delay, the expression "sufficient cause" occurring in section 253(5) of the Act deserves a liberal and justice-oriented interpretation so as to advance substantial justice. The Hon'ble Supreme Court in Collector, Land Acquisition v. Mst. Katiji & Ors. [(1987) 167 ITR 471 (SC)] laid down that a liberal approach should ordinarily be adopted while dealing with applications for condonation of delay and that substantial justice should prevail over technical considerations. Similar principles have been reiterated by the Hon'ble Supreme Court in N. Balakrishnan v. M. Krishnamurthy [(1998) 7 SCC 123], wherein it was held that the length of delay is not material; what is material is the acceptability of the explanation offered and that refusal to condone delay may result in a meritorious matter being thrown out at the threshold. The Hon'ble Supreme Court in State of Nagaland v. Lipok AO [(2005) 3 SCC 752] has also emphasized that a pragmatic and justice- oriented approach should be adopted while considering whether sufficient cause has been shown.

3.2. In the facts of the present case, we are satisfied that the explanation furnished by the assessee is bona fide and constitutes sufficient cause for not preferring the appeals within the prescribed period of limitation. There is nothing on record to suggest that the delay was deliberate or attributable to any mala fide intention. In view of the principles laid down by the Hon'ble Supreme Court in the aforesaid decisions and considering the totality of the facts and circumstances of the case, we condone the delay of 85 days in filing the present appeals. The appeals are accordingly admitted for adjudication on merits.

4.

On merits, the Ld. AR submitted that the assessee had been granted provisional registration and had filed Form No. 10AB seeking regular registration. It was contended that the application came to be filed belatedly on account of a bona fide misunderstanding of the statutory provisions. According to the Ld. AR, the assessee was under the bona fide belief that the application for regular registration was required to be filed within six months from the commencement of its charitable activities. It was submitted that the activities of the trust had actually commenced only in August, 2024 and, therefore, the delay in filing Form No. 10AB was only about four months and not 23 months as observed by the Ld. CIT(E). The Ld. AR drew our attention to the affidavit filed explaining the reasons for the delay and submitted that the delay was neither deliberate nor intentional.

4.1. The Ld. AR further submitted that the Ld. CIT(E) erred in proceeding on the assumption that the activities of the trust had commenced in August, 2022, without appreciating the documentary evidence placed on record evidencing the actual commencement of activities in August, 2024. It was further contended that the objection raised by the Ld. CIT(E) regarding Clause 18 of the Memorandum of Association was misconceived, as the said clause is merely an enabling and incidental provision and does not authorise the application of the trust funds outside India in violation of the provisions of the Act. It was thus prayed that the impugned order be set aside and appropriate relief be granted.

4.2. Per contra, the Ld. DR supported the impugned order passed by the Ld. CIT(E). It was submitted that the assessee had failed to file Form No. 10AB within the prescribed time and that the Ld. CIT(E) had rightly rejected the application in accordance with law. The Ld. DR submitted that no interference was called for with the findings recorded in the impugned order.

We have perused the submissions advanced by both sides in light of the record placed before us.

5.

The issue for our consideration is whether the Ld. CIT(E) was justified in rejecting the assessee's application for regular registration u/s 12AB on the ground of delay in filing Form No. 10AB.

5.1. We find that the Ld. CIT(E) has proceeded on the footing that the activities of the trust had commenced in August, 2022 and, accordingly, held that the application was delayed by 23 months. However, the specific case of the assessee is that its charitable activities commenced only in August, 2024, which has also been supported by documentary evidence placed before the Ld. CIT(E). We further note that the assessee has consistently explained that the delay occurred due to a bona fide misunderstanding of the statutory provisions regarding the time limit prescribed for filing Form No. 10AB.

6.

On a careful perusal of the impugned order, we find that the Ld. CIT(E) has neither examined the evidences regarding the actual commencement of the charitable activities nor recorded any finding as to why the commencement date claimed by the assessee was not acceptable. Likewise, the objection relating to Clause 18 of the Memorandum of Association has been raised without recording any finding that the assessee had actually applied or intended to apply its income outside India in contravention of the provisions of the Act. The impugned order, therefore, does not reflect a proper appreciation of the material placed on record.

7.

Considering the totality of the facts and circumstances, we deem it fit to set aside the impugned order and restore the matter to the file of the Ld. CIT(E) for de novo adjudication. The Ld. CIT(E) shall verify the actual date of commencement of the assessee's charitable activities, examine the explanation regarding the delay in filing Form No. 10AB, consider the evidences placed on record as well as the objects of the trust in their entirety, including Clause 18 of the Memorandum of Association, and thereafter pass a speaking order in accordance with law after affording adequate opportunity of being heard to the assessee.

7.1. Since the appeal relating to approval u/s 80G(5) of the Act arises out of the same set of facts and is consequential to the outcome of the assessee's application for registration u/s 12AB, we are of the considered view that the same also deserves to be restored to the file of the Ld. CIT(E). Accordingly, the impugned order passed in respect of the application for approval u/s 80G(5) is also set aside, and the matter is restored to the file of the Ld. CIT(E) for de novo adjudication. The Ld. CIT(E) shall reconsider the assessee's application for approval u/s 80G(5) afresh in accordance with law, keeping in view the outcome of the proceedings relating to registration u/s 12AB, after affording adequate opportunity of being heard to the assessee.

Accordingly, the grounds raised by the assessee are allowed for statistical purposes.

In the result, both the appeals filed by the assessee are allowed for statistical purposes. Order pronounced in the open court on 31/07/2026.

Sd/- Sd/-

VIKRAM SINGH YADAV BEENA PILLAI ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai Dated: 31/07/2026 SC, Sr. P.S.

Copy to: HEAL THE HEART FOUNDATION , 602, SEA BREEZE CO OPERATIVE SOCIETY TOWER, 2 SECTOR, 16, 1 NERUL NODE III, NAVI MUMBAI-400706, MAHARASHTRA CIT(EXEMPTION), ROOM NO. 601, 6TH FLOOR, CUMBALLA HILL MTNL BUILDING 2 PEDDER ROAD, DR. GOPALRAO DESHMUKH MARG, CUMBALLA HILL, MUMBAI-400026, MAHARASHTRA 3 THE PCIT / CIT, 4 THE D.R., ITAT, MUMBAI BENCH 5 GUARD FILE

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