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Facts
The assessee trust filed applications for registration under Section 12AB and approval under Section 80G. The CIT(E) rejected the application for registration under Section 12AB due to a technical error in selecting the wrong sub-clause in Form 10AD. Consequently, the application for approval under Section 80G was also rejected as registration under 12AB is a prerequisite.
Held
The Tribunal held that the mistake in selecting the sub-clause was a technical one and not fatal. The CIT(E) was directed to consider the application for registration under section 12A(1)(ac)(iii) and grant registration if other conditions are met. Both appeals were restored to the CIT(E) for fresh consideration.
Key Issues
Whether a technical error in selecting a sub-clause in an application for registration is fatal to the application, and whether the CIT(E) should have granted registration after rectifying the error.
Sections Cited
12AA, 12AB, 12A(1)(ac)(iii), 12A(1)(ac)(vi), 80G
AI-generated summary — verify with the full judgment below
PER PAWAN SINGH, JUDICIAL MEMBER:
These two appeals by assessee are directed against the separate orders of ld. CIT(E). In appeal in the assessee has challenged the action of ld. CIT(E) in rejecting the application of assessee trust for registration under section 12AA/12AB. In ITA 4833/M/2025, the assessee has challenged the rejection of application for approval of fund under section 80G. Facts in both the appeals are inter-connected, thus, with the consent of parties both the appeals were clubbed, heard together and are decided by common order.
Rival submissions of both the parties have been heard and record perused.
The learned Authorised Representative (ld. AR) of the assessee submits that assessee is a trust registered under the provisions of Maharashtra Public Trust Act. The assessee trust filed an application for registration of trust under section 12AB. While filing Form 12A by mistake opted sub-clause (vi) in place of sub-clause (iii) of clause (ac) of Section 12A(1). The ld. CIT(E) rejected the application of assessee by taking view that request to consider the application under section 12A(1)(ac)(iii) cannot be accepted. The application of assessee was rejected on technical reason. The assessee while filing application furnished all necessary information and documents. The law full object and genuineness of activities of assessee is not in dispute. The assessee has already been allowed provisional registration which valid upto AY 2024-25. The assessee fulfilled all the requisite conditions for registration under section 12AB though there is no reference in the order about satisfaction of ld. CIT(E) on object and activities of the assessee, as application of assessee was rejected on technical reason. The ld. CIT(E) ought to have allowed to correct the mistake. The ld. AR of the assessee submits that application of assessee may be considered under appropriate provision for allowing registration under section 12AB. In alternative plea, the ld. AR of the assessee submits that matter may be restored back to the file of ld. CIT(E) with the direction to consider the application of assessee for registration under section 12AB as it has been applied under section 12A(1)(ac)(iii) of the Act and to allow registration from the date of application. He undertakes on behalf of assessee to furnish all requisite information and evidence for satisfying the object and activities of the assessee. in appeal for rejection of approval under section 80G, the ld. AR of the assessee submits that once the application for registration under section 12AB was rejected, consequently, the application for approval under section 80G was also rejected. The ld. AR of the assessee submits for approval under section 80G, registration under section 12AB is pre-condition, therefore, this appeal also restored back to the file of ld. CIT(E) to decide after decision on application for registration under section 12AB.
On the other hand, the learned Commissioner of Income Tax – Departmental Representative (CIT-DR) for the revenue supported the order of lower authorities.
We have considered the rival submissions of both the parties and have gone through the orders of lower authorities carefully. We find that application of assessee for registration under section 12AB was rejected on the ground that assessee has not applied for registration of trust under section 12A(1)(ac)(iii), rather applied under section 12A(1)(ac)(vi). Considering the plea of ld. AR of the assessee that while filing application under Form 10AD, the applicant of assessee due to inadvertence selected an appropriate sub- clause and the mistake in filing such entry is not fatal, the ld. CIT(E) is directed to treat the application of assessee under section 12A(1)(ac) (iii) and in case the assessee fulfilled other remaining conditions i.e. law full object and genuineness activities are charitable and also fulfil compliance of any other law, allowed registration under section 12AB to assessee in accordance with law. Needless to direct that before passing the order of ld. CIT(E) shall allow reasonable opportunity to assessee. The assessee is also directed to furnish all necessary details and evidence if required by ld. CIT(E) for satisfaction on object and activities of the assessee trust. In the result, appeal of assessee in is allowed for statistical purposes.
(A.Y. 2025-26) in the matter of approval under section 80G(5) 6. Considering the fact that we have restored the appeal in which relates to registration of appellant trust under section 12AA/12AB, therefore, this appeal is also restored back to the file of ld. CIT(E) to decide the present appeal after taking decision on the application of registration of assessee trust under section 12AA/12AB. In the result, this appeal is also allowed for statistical purposes.
In the result, both the appeals of the assessee are allowed for statistical purposes.
Order was pronounced in the open Court on 15/09/2025 at the time of hearing.