SMT RUPAWANTI HARISHCHANDRA JAIN WELFARE FOUNDATION,MUMBAI vs. COMMISSIONER OF INCOME TAX (EXEMPTION), MUMBAI, MUMBAI

We have heard the rival submissions and carefully perused the material placed on record. It is an undisputed position emerging from the impugned order that the assessee had filed its application in Form No. 10AB under section 12A(1)(ac)(vi)(B) of the Act. Upon verification of the records, the learned CIT (Exemption) noticed that the assessee had already filed its returns of income in Form ITR-7 for the Assessment Years 2023-24 to 2025-26 claiming exemption under sections 11 and 12 of the Act. Proceeding on this premise, the learned CIT (Exemption) concluded that the application under section 12A(1)(ac)(vi)(B) was not maintainable and, accordingly, rejected the application.

Before us, the learned counsel submitted that the assessee is a charitable institution duly carrying on its objects and that the rejection has not been founded upon any adverse finding with regard to the genuineness of its activities or the fulfilment of the statutory conditions governing registration. The sole basis for rejection is that the application came to be filed under an incorrect clause of section 12A(1)(ac). It was submitted that such an error was purely procedural and inadvertent and could not, by itself, result in denial of the substantive claim for registration. Our attention was also invited to the decision of the Coordinate Bench in the case of Zarina Foundation vs. CIT (Exemption), wherein, on

Having given our thoughtful consideration to the rival submissions, we find considerable force in the contention advanced on behalf of the assessee. The impugned order does not record any finding that the objects of the trust are not charitable or that its activities lack genuineness. The rejection has been occasioned solely because the assessee invoked an incorrect statutory clause while filing Form No. 10AB. Such a procedural lapse, by itself, cannot foreclose an examination of the assessee’s entitlement under the correct statutory provision, particularly when the material necessary for examining such entitlement is otherwise available on record. In matters concerning grant of registration to charitable institutions, the authority is expected to examine the substantive eligibility of the applicant in the backdrop of the statutory framework rather than conclude the proceedings merely on account of an inadvertent error in quoting the relevant provision.

In these facts and circumstances, we deem it appropriate to set aside the impugned order and restore the matter to the file of the learned CIT (Exemption). The learned CIT

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