ZIDNI ILMA CHARITABLE TRUST,VADODARA vs. THE ITO, WARD-EXEMP, VADODARA

ITA 914/AHD/2026Status: DisposedITAT Ahmedabad28 September 2026AY 2018-1911 pages
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What were the facts?

The assessee, Zidni Ilma Charitable Trust, filed appeals for Assessment Years (AY) 2015-2016, 2016-2017, and 2018-2019. The appeals were against orders passed by the Commissioner of Income Tax (Appeals) [CIT(A)] dismissing the assessee's appeals against Intimation Orders passed under Section 143(1) of the Income Tax Act, 1961. The CIT(A) had dismissed the appeals as being barred by limitation. The assessee had filed its returns claiming exemption under Sections 11 and 12A. The Intimation Orders under Section 143(1) were passed due to the non-filing of the audit report in Form No. 10B within the specified time, leading to taxable income being determined at INR 37,75,222/- for AY 2015-2016. The delay in filing appeals before the CIT(A) was approximately 6 years and 10 months.

What did the Tribunal hold?

The Tribunal held that the CIT(A) erred in dismissing the appeal solely on the technical ground of limitation without condoning the delay. The Tribunal found that the affidavit submitted by the trustee provided a reasonable explanation for the significant delay, attributing it to bonafide ignorance, lack of technical understanding, and a mistaken belief regarding the enforceability of tax demands against a registered charitable trust. The Tribunal emphasized that when technical lapses due to lack of knowledge are pitted against substantial justice, the latter must prevail. Citing *Mst. Katiji* and *N. Balakrishnan*, the Tribunal ruled that there was sufficient and bonafide cause for the delay. Consequently, the order of the CIT(A) was set aside, the delay was condoned subject to the deposit of INR 10,000/- in the Prime Minister National Relief Fund within 21 days, and the appeals were restored to the file of the CIT(A) for adjudication on merits. Ground No. 1 was allowed, while other grounds were dismissed without findings on merits.

What were the issues?

1. Whether the CIT(A) erred in dismissing the appeal on account of being filed beyond the period prescribed under the Income Tax Act, and if so, whether the delay should be condoned? (Question of law and fact, turning on principles of condonation of delay). Assessee's Contention: The delay was occasioned due to bonafide and unavoidable circumstances, including the trustee's limited education, lack of technical knowledge, and ignorance of the legal implications of the Section 143(1) intimations. The trustee genuinely believed no enforceable tax liability could arise against a registered charitable trust. The seriousness of the demands was realized only upon receipt of recovery notices. The assessee relied on the principles laid down in *Mst. Katiji v. Union of India* and *N. Balakrishnan v. M. Krishnamurthy* for condonation of delay. Revenue's Contention: The judgment does not record any specific arguments made by the Revenue regarding the condonation of delay.

Which sections of the Income-tax Act were involved?

Section 143(1),Section 11,Section 12A,Section 57,Section 37

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Income Tax Appellate Tribunal, A” BENCH, AHMEDABAD

Per Rahul Chaudhary, Judicial Member:

1.

These are batch of three appeals preferred by the same Assessee involving identical issues. Therefore, the same were heard together and are being disposed off by way of common order.

2.

We would first take up ITA No.912/AHD/2026 pertaining to Assessment Year 2015-2016 preferred by the Assessee against the Order, dated 27/01/2026, passed by the Commissioner of Income Tax, Appeal ADDL/JCIT (A)-2 Noida [hereinafter referred to as the ‘CIT(A)’] wher

The order continues below.

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