NARMADA NAVNIRMAN ABHIYAN,MUMBAI vs. CIT EXEMPTIONS , MUMBAI

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “B” MUMBAI BEFORE SMT BEENA PILLAI (JUDICIAL MEMBER) AND SMT RATNA DASGUPTA (ACCOUNTANT MEMBER) ITA No. 6117/MUM/2026 Assessment Year: 2026-27 & ITA No. 6075/MUM/2026 Assessment Year: 2026-27

Narmada Navnirman CIT Exemptions Abhiyan, 601, MTNL Exchange Vs. A Wing, Haji Habib Building, Peddar Road, Building, Naigan Cross Mumbai, Road, Dadar, Mumbai, Maharashtra- 400026 Maharashtra- 400014 PAN NO. AAATN6149D Appellant Respondent

Appellant by : Shri Rashmikant C. Modi & Ms. Ketki Rajeshirke Respondent by : Shri B. Jayaraghvan, CIT DR

Date of Hearing : 19/08/2026 Date of pronouncement : 25/09/2026

ORDER PER RATNA DASGPUTA, AM

The captioned appeals by the assesse arise out of two separate orders, both dated 23/03/2026, by the Ld. Commissioner of Income-tax (Exemption) [in short, CIT(E] rejecting the assessee’s

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application for registration under Section 12AB of the Income-tax Act, 1961 (in short, ‘the Act’) and also application for approval under Section 80G of the Act. Since the rejection of the assessee’s application for approval u/s. 80G of the Act was in consequence of rejection of the application for registration under 12AB of the Act, both these appeals are taken up together for the purpose of convenience. ITA No. 6117/MUM/2026 2. The brief facts of the case are that the assessee filed application in Form 10AB on 30/09/2025 seeking regularization of provisional registration under Section 12A(1)(ac)(iii) of the Act. On verification of the said application, the Ld. CIT(E) noted that the application was incomplete and that all documents required to be furnished with the application had not been enclosed. Notice was issued to the assessee for furnishing complete set of documents as required under Rule 17A(2), whereupon the assessee made due submission vide letter dated 13/01/2026 and furnished relevant details. However, on perusal of the above submission, together with details and documents attached with Form 10AB and data available on ITBA/CPC portal, it was observed that the assessee had been granted regular registration in Form 10AC on 24/09/2021 u/s. 12A of the Act, which was valid from A.Y. 2022-2023 to A.Y. 2016-27. As the assessee Trust had already been granted regular registration,

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the application for renewal of regular registration ought to have been filed u/s. 12A(1)(ac)(ii) and not u/s. 12A(1)(ac)(iii). The Ld. CIT(E) noted that the assessee had made application u/s. 12A(1)(ac)(iii) of the Act which is valid only for a trust/institution having provisional registration for three years and seeking regularization of provisional registration which is due to expire. Hence, the assessee, having regular registration for five years, does not qualify to make the application u/s. 12A(1)(ac)(iii) of the Act. In view of the above, considering that the application had been filed under a wrong section, the Ld. CIT(E) rejected the application, holding that for statistical purposes the same was not maintainable.

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been considered on merits instead of being rejected on technical and procedural grounds. The Appellant submits that Hon'ble Commissioner of Income Tax (Exemptions) be directed to grant registration u/s 12AB of the Act to the Appellant, or for such other relief, as the Hon’ble Tribunal may deem fit in the circumstances of the case. ii. The Appellant crave; leave to reserve to itself the right to add, after, amend or annul any of the grounds of appeal at or before the time of hearing and to produce such further evidences, documents and papers as may be necessary.” 4. The Ld. AR for the assessee submitted that the filing of the application u/s. 12A1(ac)(iii) instead of Section 12A(1)(ac)(ii) was entirely an inadvertent and bona-fide mistake. He contended that the error was technical in nature and did not affect the merits of the application. He argued that the Ld. CIT(E) ought not to have rejected the application solely on this technical ground of wrong clause, without affording an opportunity to the assessee to rectify the defect or file an application under the correct clause. It was his contention that the Ld. CIT(E) was wrong in holding the application “not maintainable” without examining the Trust’s objects or genuineness of its activities, although in his own order he had acknowledged the existing regular registration, stating that the same would continue to remain valid from A.Y. 2022-23 to A.Y. 2026-27. 5. Per contra, the Ld. CIT DR relied upon the order passed by the Ld. CIT(E).

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impugned defect, consider the application under appropriate provisions, and thereafter decide the issue in accordance with law after examining all relevant facts, including the objects of the Trust and the genuineness of its activities. 8. With this, the grounds raised by the assessee in ITA No. 6117/Mum/2026 are allowed for statistical purposes. ITA No. 6075/MUM/2026 9. Brief facts are that on 30/09/2025, when the assessee Trust applied for registration u/s 12AB of the Income-tax Act, 1961, it also filed an application in Form 10AB u/s. 80G(5) of the Act seeking registration u/s. 80G. The Ld. CIT(E), while considering the approval so sought u/s 80G, noted the provisions of section 80G(5)(i) which stipulates the condition that the benefits of this section are only available for an institution or fund for which sections 11, 12 or 10(23AA) or 10(23C) of the Act apply. The Ld. CIT(E) held that since the assessee fails to fulfil any of the above criteria in view of the rejection of its application for registration u/s. 12AB of the Act, its application for approval u/s. 80G also becomes untenable. In view of this, the Ld. CIT(E) rejected the assessee’s application for approval u/s. 80G. 10. Against the rejection as above, the assessee filed the following grounds of appeal -

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i. “On the facts and in the circumstances of the case and in law, the Hon'ble Commissioner of Income Tax (Exemptions), Mumbai erred in rejecting the application for approval u/s 80G(5) of the Income-tax Act, 1961 filed in Form No. 10AB, without properly appreciating the facts and material available on record. ii. On the facts and in the circumstances of the case and in law, the Hon'ble Commissioner of Income Tax (Exemptions), Mumbai erred in holding that the Appellant was not eligible for approval u/s 80G merely on the ground that the application for registration u/s 12AB was rejected, without independently examining the conditions prescribed under section 80G(5) of the Act. iii. On the facts and in the circumstances of the case and in law, the Hon'ble Commissioner of Income Tax (Exemptions), Mumbai failed to appreciate that the rejection of registration u/s 12AB, being separately contested by the Appellant, could not be the sole basis for rejection of approval u/s 80G of the Act. iv. The Appellant submits that the impugned order passed by the Hon'ble Commissioner of Income Tax (Exemptions) be quashed and the approval sought u/s 80G(5) of the Act be granted to the Appellant. v. The Appellant craves leave to reserve to itself the right to add, after, amend or annul any of the grounds of appeal at or before the time of hearing and to produce such further evidences, documents and papers as may be necessary.” 11. The reason for summary rejection of the assessee’s application for approval u/s. 80G is that the assessee’s application for registration under 12AB of the Act has been rejected, albeit on technical grounds. Since we have remitted the assessee’s application for registration u/s. 12AB of the Act to the file of the Ld. CIT(E) for fresh adjudication on merits, we deem it appropriate to

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also remit the instant application for approval u/s. 80G of the Act to the Ld. CIT(E). The Ld. CIT(E) shall consider the section 80G application on merits pursuant to decision taken in respect of the assessee’s application for registration u/s 12AB of the Act. Needless to state, the assessee should be given adequate opportunity of being heard. We, however, make it clear that we have not expressed any opinion on the merits of the application u/s 80G – that issue is kept open for consideration by the Ld. CIT(E).

Order pronounced in the open Court on 25/09/2026

Sd/- Sd/- (BEENA PILLAI) (RATNA DASGPUTA) JUDICIAL MEMBER ACCOUNTANT MEMBER Mumbai; Dated: 25/09/2026 Z.U., P.S. Copy of the Order forwarded to : 1. The Appellant 2. The Respondent. 3. CIT 4. DR, ITAT, Mumbai 5. Guard file.

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BY ORDER,

//True Copy// (Assistant Registrar) ITAT, Mumbai