BIJA CONSERVATION FOUNDATION,MUMBAI vs. COMMISSIONER OF INCOME-TAX (EXEMPTIONS), MUMBAI

Brief facts of the case are that the assessee is a Section 8 company incorporated under the provisions of the Companies Act, 2013 on 20.11.2022. The objects of the assessee company, as borne out from the Memorandum of Association and the material placed on record, are charitable in nature and primarily relate to preservation of environment, promotion of afforestation, biodiversity conservation, conservation of natural resources, promotion of renewable energy, eradication of hunger and poverty, socio economic welfare activities, medical and healthcare programmes and research and development activities for charitable purposes. The assessee had initially applied for provisional registration under section 12AB and the same was granted vide Form No.10AC dated 01.12.2022 which remained valid from Assessment Year 2023-24 to Assessment Year 2025-26.

The chronology of events placed before us reveals that the assessee commenced its activities during Financial Year

From the impugned order, it is seen that the learned CIT(E) rejected the assessee’s application primarily on two grounds. Firstly, according to the learned CIT(E), the application filed in Form No.10AB was delayed by approximately twenty four months and no satisfactory explanation was furnished for such delay. Secondly, the learned CIT(E) observed that certain clauses contained in the Memorandum of Association enabled the assessee to apply funds outside India and also engage foreign personnel and therefore, according to him, the assessee was not entitled to registration under section 12AB.

Before us, the learned counsel for the assessee submitted that the delay in filing Form No.10AB was neither intentional nor deliberate, but occurred due to a bona fide

The learned counsel further submitted that the assessee had never carried out any activity outside India, nor had it opened any branch abroad or remitted any funds outside India. It was submitted that the objection of the learned CIT(E) was merely based on certain enabling clauses in the Memorandum of Association and not on any actual activity undertaken by the assessee. It was further pointed out that immediately upon such objection being raised, the assessee amended the relevant clause in the Memorandum of Association by deleting the words “and elsewhere” and the amended Memorandum along with the Board Resolution was duly placed before the learned CIT(E) prior to passing of the impugned order.

On the other hand, the learned CIT DR strongly relied upon the impugned order passed by the learned CIT(E). He submitted that the assessee had failed to file Form No.10AB within the prescribed time and therefore the learned CIT(E) was justified in rejecting the application. He further submitted that the clauses contained in the Memorandum of Association clearly enabled the assessee to undertake activities outside India and accordingly the learned CIT(E) had rightly entertained doubts regarding the allowability of registration under section 12AB.

We have given our thoughtful consideration to the rival submissions and carefully perused the entire material placed on record. The rejection of registration by the learned CIT(E) is primarily founded on two grounds, firstly, the delay in filing Form No.10AB and secondly, certain clauses contained in the Memorandum of Association which according to the learned CIT(E) enabled the assessee to undertake activities outside India. The assessee, on the other hand, has consistently maintained before the authorities that the delay had occurred due to a bona fide misunderstanding of the procedural requirements under the amended statutory scheme governing registration under section 12AB and that there was no deliberate or intentional default on its part. It has also been specifically explained that the assessee had not undertaken any activity outside India, nor had it remitted any funds abroad or established any branch outside India. The assessee had further amended the relevant clause in the Memorandum of Association prior to passing of the impugned order and the amended Memorandum along with the Board Resolution was also placed before the learned CIT(E).

On a careful consideration of the entire factual matrix, we find that the matter requires fresh examination at the end of the learned CIT(E). The assessee has placed on record various explanations regarding the delay in filing Form

Accordingly, we set aside the impugned order passed by the learned CIT(E) and restore the matter back to his file with a direction to examine afresh the issue relating to condonation of delay in filing Form No.10AB and also consider the amended Memorandum of Association and thereafter decide the application for registration under section 12AB in accordance with law after providing reasonable opportunity of hearing to the assessee.

Since we have set aside the application for registration u/s.12AB to the file of the CIT(E), consequently, the application u/s.80G is also restored back to the file of the

In the result, the appeal filed by the assessee is treated as allowed for statistical purposes.