FIRST COMMANDMENT FOUNDATION,MUMBAI vs. CIT EXEMPTION, MUMBAI

These two appeals by the assessee are directed against separate orders passed by the Ld. Commissioner of Income Tax (Exemptions), Mumbai [hereinafter referred to as "Ld. CIT(E)"] rejecting the assessee's application for registration u/s 12AB and approval u/s 80G(5) of the Income-tax Act, 1961 ("the Act"). Since common facts are involved, both the appeals were heard together and are being disposed of by this consolidated order.

We have considered the petition for condonation of delay and the submissions of the parties. The explanation furnished by the assessee demonstrates that the delay was not deliberate or intentional. It is a settled proposition that substantial justice should prevail over technical considerations. Considering the reasons stated in the petition and in the interest of substantial justice, we condone the delay of 388 days and admit the appeal for adjudication on merits.

Briefly stated, the assessee trust was granted provisional registration and thereafter filed an application in Form No.10AB seeking regular registration u/s 12AB of the Act. The Ld. CIT(E) rejected the application on the ground that despite notices issued on 29.08.2024 and 03.10.2024, the assessee did not furnish the requisite details and documents required under Rule 17A and, therefore, the Ld. CIT(E) was unable to satisfy himself regarding the objects and genuineness of activities of the trust. Consequently, the application for registration was rejected vide order dated 11.10.2024.

Before us, the Ld. Authorised Representative submitted that the trust had already furnished the relevant documents to its consultant and due to communication failure and lapse on the part of the consultant, the notices could not be properly complied with. It was submitted that the 2

We have heard the rival submissions and perused the material available on record. We find that the application for registration has been rejected primarily for non-compliance with notices and non-furnishing of requisite documents. The assessee has explained that the non- compliance occurred due to failure and inaction on the part of its consultant. The grounds raised before us also contend that adequate and effective opportunity was not available to the assessee before rejection of the application.

In our considered view, registration u/s 12AB has significant consequences for a charitable institution and, therefore, the application deserves to be examined on merits after granting adequate opportunity to the assessee. Since the rejection has been made for want of compliance and not after examination of the objects and activities on merits, we deem it appropriate, in the interest of justice, to restore the matter to the file of the Ld. CIT(E). The assessee shall furnish all documents and details called for by the Ld. CIT(E), and the Ld. CIT(E) shall decide the application afresh in accordance with law after granting reasonable opportunity of being heard.

Accordingly, the impugned order dated 11.10.2024 rejecting registration u/s 12AB is set aside and the matter is restored to the file of the Ld. CIT(E) for fresh adjudication. The grounds raised by the assessee are allowed for statistical purposes.

We shall now take up the appeal relating to rejection of approval u/s 80G(5) of the Act. The Ld. CIT(E) rejected the application for approval u/s 80G primarily on the ground that the assessee's application for 3

We have already restored the issue relating to registration u/s 12AB to the file of the Ld. CIT(E) for fresh adjudication. The rejection of approval u/s 80G is founded upon rejection of registration u/s 12AB. Therefore, the issue relating to approval u/s 80G is purely consequential to the decision to be taken in the proceedings relating to registration u/s 12AB.

Accordingly, we set aside the impugned order rejecting approval u/s 80G and restore the matter to the file of the Ld. CIT(E) to be decided afresh consequent to and in accordance with the decision taken in the proceedings relating to registration u/s 12AB, after providing adequate opportunity of hearing to the assessee.

In the result, the appeal in ITA No.1682/Mum/2026 relating to registration u/s 12AB is allowed for statistical purposes and the appeal in ITA No.1681/Mum/2026 relating to approval u/s 80G is also allowed for statistical purposes.