EMPOWERING MOBEDS TRUST,MUMBAI vs. COMMISSIONER OF INCOME TAX (EXEMPTIONS), MUMBAI

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ITA 4060/MUM/2026Status: DisposedITAT Mumbai23 June 20264 pages
AI SummaryRemanded

What did the Tribunal hold?

The tribunal held that a bona fide clerical error in selecting an incorrect provision while filing an online application cannot be a ground to deny a statutory claim, especially when the mistake is curable. The limitations of the departmental software should not override substantive rights.

What were the facts?

The assessee's application for renewal of registration under section 12AB was rejected by the CIT(E) because it was filed under the wrong sub-clause. The assessee had inadvertently selected section 12A(1)(ac)(ii) instead of the applicable section 12A(1)(ac)(iii).

What were the issues?

Whether a registration application under section 12AB can be rejected solely due to a clerical error in selecting the wrong sub-clause, and if the departmental software's inability to correct such errors can defeat a legitimate claim.

Which sections of the Income-tax Act were involved?

Section 12AB,Section 12A(1)(ac)(ii),Section 12A(1)(ac)(iii),Section 80G

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘E’ BENCH

Before: SHRI AMIT SHUKLA & SHRI GIRISH AGRAWAL

For Appellant: Shri Honiyar Madan
For Respondent: Smt. Amrita Singh, CIT DR
Hearing: 23/06/2026Pronounced: 23/06/2026

आदेश / O R D E R PER AMIT SHUKLA (J.M): The aforesaid two appeals have been preferred by the assessee against two separate orders dated 25.03.2026 passed by the learned Commissioner of Income Tax (Exemptions), Mumbai, whereby the application filed by the assessee seeking renewal of registration under section 12AB of the Income Tax Act, 1961 has

2 ITA No.4059/Mum/2026 & 4060/Mum/2026 Empowering Mobeds Trust been rejected and, as a consequence thereof, the application seeking renewal of approval under section 80G of the Act has also been rejected.

2.

The sole grievance of the assessee has been that ld. CIT(E) was erred in law and facts in rejecting the application merely on the ground that assessee had applied under wrong sub-clause i.e. Section 12A(1)(ac)(ii) instead of applicable Section 12A(1)(ac)(iii).

3.

Before us ld. Counsel stated that this issue now stands covered by the decision of the Hon’ble Bombay High Court in the case of Bhikha Behram Well Trust vs. The Commissioner of Income Tax (Exemptions) in Writ Petition No.3254 of 2025 dated 22nd September 2025 wherein, the Hon’ble High Court had observed and held as under:-

“The Bombay High Court held that a bona fide clerical or inadvertent error in selecting an incorrect provision while filing an online application cannot be a ground to deny or reject a statutory claim, particularly when the mistake is otherwise curable. The inability of the departmental software to permit correction cannot override substantive rights available under the Act. Administrative or technological limitations of the tax department cannot be used to defeat a legitimate claim of the assessee.”

4.

The trust had inadvertently selected section 12A(1)(ac)(ii) instead of section 12A(1)(ac)(iii) while filing its registration application. The CIT(E) rejected the application on the ground that the online system did not permit correction of the mistake. The Bombay High Court held that such an approach was unjustified, observing that a genuine clerical error should not result in denial

3 ITA No.4059/Mum/2026 & 4060/Mum/2026 Empowering Mobeds Trust of statutory benefits merely because the software lacks a correction mechanism. The Court directed that the assessee be permitted to file a fresh application and that the delay be condoned and the application processed in accordance with law.

5.

Thus, the sequator of the judgment of the Hon’ble Bombay High Court is that a substantive statutory benefit cannot be denied merely because of a bonafide clerical mistake in an e-file application or due to the limitation of the departmental software. Accordingly, we hold that on this ground ld. CIT(E) could not have rejected the application. This matter is restored back to the file of the ld. CIT(E) and decide the application afresh both u/s.12AB and consequently u/s.80G.

6.

In the result, appeals of the assessee are allowed for statistical purposes.

Order pronounced on 23rd June, 2026.

Sd/- Sd/- (GIRISH AGRAWAL) (AMIT SHUKLA) ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai; Dated 23/06/2026 KARUNA, sr.ps

4 ITA No.4059/Mum/2026 & 4060/Mum/2026 Empowering Mobeds Trust Copy of the Order forwarded to : 1. The Appellant 2. The Respondent. 3. CIT 4. DR, ITAT, Mumbai 5. Guard file. //True Copy// BY ORDER,

(Asstt. Registrar) ITAT, Mumbai

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