THANE LABOUR LAW PRACTITIONERS ASSOCIATION,THANE vs. EXEMPTION THANE, THANE

ITA 3337/MUM/2026Status: DisposedITAT Bangalore01 October 2026AY 2022-202310 pages
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What were the facts?

The assessee, Thane Labour Law Practitioners Association, filed an appeal before the Commissioner of Income-tax (Appeals) [CIT(A)] against an assessment order dated 26.02.2024 for assessment year 2022-23. The CIT(A) dismissed the appeal in limine for being delayed by 86 days, without adjudicating the grounds on merits. The assessee is an association of advocates and labour law practitioners. Its registration under section 12A/12AB was rejected on 31.03.2023, and provisional registration was cancelled. The Assessing Officer treated membership receipts of Rs.1,29,450/- as business income and other receipts totaling Rs.4,54,973/- (donations, interest, locker rent, life membership fees) as taxable income, completing the assessment at Rs.5,84,423/-. The appeal was filed on 20.06.2024.

What did the Tribunal hold?

The Tribunal held that the learned CIT(A) erred in refusing to condone the delay. The Tribunal found that the assessee had provided a specific explanation supported by an affidavit, detailing the announcement and holding of elections for its managing committee, the outgoing committee becoming functus officio, and the subsequent steps taken to file the appeal. The Tribunal considered the principles laid down by the Supreme Court in Collector, Land Acquisition, Anantnag v. Mst. Katiji and Others and N. Balakrishnan v. M. Krishnamurthy, emphasizing the need for a practical consideration of the explanation for delay and the acceptability of the explanation as the criterion, rather than the length of the delay. The Tribunal acknowledged a discrepancy in the dates of receipt of the assessment order but found that it did not establish that the entire explanation was false or that the delay was deliberate. The Tribunal was satisfied that sufficient cause existed for not filing the appeal within the prescribed period and condoned the delay of 86 days. Consequently, the order of the CIT(A) was set aside, and the appeal was restored to the file of the CIT(A) for adjudication of the original grounds on merits. The Tribunal clarified that this restoration did not grant registration under section 12A/12AB or recognize entitlement to exemption under sections 11 and 12, and the substantive contentions of the assessee remained open for adjudication by the CIT(A).

What were the issues?

1. Whether the learned CIT(A) erred in refusing to condone the delay of 86 days in filing the appeal, considering the explanation of "sufficient cause" arising from bona fide institutional circumstances, as per Section 249(3) of the Income-tax Act, 1961. 2. Whether the learned CIT(A) failed to exercise judicial discretion judiciously by adopting an unduly technical approach in rejecting the condonation application. 3. Whether the learned CIT(A) violated principles of natural justice by rejecting the condonation application without allowing the assessee to clarify or supplement its explanation. 4. Whether the learned CIT(A) erred in dismissing the appeal in limine without adjudicating the substantive grounds on merits. 5. Whether substantial justice ought to prevail over technical considerations, particularly when the delay was moderate and explained. 6. Whether the assessee has an arguable case on merits regarding the taxability of corpus donations, applicability of mutuality to membership receipts, and taxability of interest income. Assessee's Arguments: The delay was due to bona fide institutional circumstances, including elections to the managing committee and the transition of affairs. The CIT(A) adopted a technical approach and failed to exercise discretion judiciously. The dismissal without adjudicating merits denied an effective appellate remedy. Substantial justice should prevail. The assessee has a strong prima facie case on merits concerning corpus donations, mutuality, and interest income. Revenue's Arguments: Not recorded in the judgment.

Which sections of the Income-tax Act were involved?

Section 249(3),Section 143(3),Section 144B,Section 11,Section 12,Section 12A,Section 12AB

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, MUMBAI BENCHES, MUMBAI

For Appellant: Shri Jayant Chavan, Ld. A.R
For Respondent: Ms. Jayshree Thakur, Ld. Sr. D.R
Hearing: 23.07.2026Pronounced: 01.10.2026

PER: MAKARAND VASANT MAHADEOKAR, AM

This appeal by the assessee is directed against the order dated 05.01.2026 passed by the learned Commissioner of Income-tax (Appeals), National Faceless Appeal Centre, Delhi [hereinafter referred to as “the learned CIT(A)”], under section 250 of the Income-tax Act, 1961 [hereinafter referred to as “the Act”]. The impugned order arises from the assessment order dated 26.02.2024 passed under section 143(3) read with section 144B of the Act for the assessment year 2022-23. The learned CIT(A) refused to condone the delay in filing the first appeal and dismissed it in limine, w

The order continues below.

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