SHREE KUTCHI SARVODAY NAGAR ACHALGACCHA JAIN SANGH,MUMBAI vs. COMMISSIONER OF INCOME TAX (EXEMPTIONS), MUMBAI

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ITA 7052/MUM/2026Status: DisposedITAT Mumbai16 October 20265 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that the assessee's appeals were allowed for statistical purposes. The Tribunal noted that the CIT(E) had rejected both applications on technical grounds, specifically for being filed under the wrong sections. The first application was rejected because the assessee had provisional registration and applied under a section for renewal of regular registration. The second application was rejected because the assessee had regular registration and applied under a section for regularization of provisional registration. The Tribunal found that the assessee had made efforts by filing a second application after the first rejection. It was deemed appropriate to set aside the matter to the CIT(E) to ascertain the correct factual position and decide the applications afresh as per law, after providing the assessee with a reasonable opportunity to be heard. The principle is that technical defects in filing applications should not prevent the substantive consideration of registration or renewal if the underlying documentation is available, and the assessee has made efforts to rectify the situation.

What were the facts?

The assessee, Shree Kutchi Sarvoday Nagar Achalgaccha Jain Sangh, filed two appeals before the Income Tax Appellate Tribunal (ITAT), Mumbai, against orders passed by the Commissioner of Income Tax (Exemptions)-Mumbai (CIT(E)) for Assessment Year 2025-26. The first order, dated 18.09.2025, rejected the assessee's application for regularization of registration under Section 12AB of the Income Tax Act, 1961, on the grounds that it was filed under the wrong section (12A(1)(ac)(ii)) despite having provisional registration. The second order, dated 27.03.2026, rejected another application filed on 30.09.2025 for regularization of provisional registration under Section 12A(1)(ac)(iii), again citing the filing under the wrong section as the assessee had regular registration. The assessee did not appear before the Tribunal, but the Revenue was represented. The amount in dispute is not specified.

What were the issues?

1. Whether the assessee's application for registration under Section 12AB of the Income Tax Act, 1961, filed on 01.03.2025, was liable to be rejected for being filed under the wrong provision (Section 12A(1)(ac)(ii)) when the assessee had provisional registration? 2. Whether the assessee's subsequent application for regularization of provisional registration under Section 12A(1)(ac)(iii) of the Income Tax Act, 1961, filed on 30.09.2025, was liable to be rejected for being filed under the wrong provision when the assessee had regular registration? Assessee's Contentions: Not recorded as none appeared. The assessee admitted in correspondence to the CIT(E) that the first application was filed under the wrong section and requested consideration. The assessee also filed a second application. Revenue's Contentions: The Revenue's representative argued that the applications were rejected by the CIT(E) for the reason that they were filed under the wrong section.

Which sections of the Income-tax Act were involved?

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

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “E” BENCH; MUMBAI

Before: SHRI VIKRAM SINGH YADAV & SHRI ANIKESH BANERJEE

Hearing: 12.10.2026Pronounced: 16.10.2026

IN THE INCOME TAX APPELLATE TRIBUNAL “E” BENCH; MUMBAI BEFORE SHRI VIKRAM SINGH YADAV, ACCOUNTANT MEMBER AND SHRI ANIKESH BANERJEE, JUDICIAL MEMBER ITA No. 7053 & 7052/Mum/2026 (Assessment Year: 2025-26)

Shree Kutchi Sarvoday Nagar Commissioner of Income Tax Achalgaccha Jain Sangh (Exemptions) Podium B2 Building Kutchi vs. Room No. 601, 6th Floor, Sarvoday Nagar, PL Lokhande Cumballa Hill, MTNL TE Marg, Govandi, Chembur, Building, Pedder Road, Dr. Mumbai, Maharashtra, Gopalrao Deshmukh Marg, 400043. Cumballa Hill, Mumbai, Maharashtra, 400026. PAN: ABDTS6380H (Appellant) (Respondent) For Assessee : None For Revenue : Smt. Amrita Singh, CIT DR Date of Hearing : 12.10.2026 Date of Pronouncement : 16.10.2026 O R D E R PER VIKRAM SINGH YADAV, A.M : These are two appeals filed by the Assessee against the respective orders of the Learned Commissioner of Income Tax (Exemptions)-Mumbai [‘Ld. CIT(E)’], dated 18.09.2025 and 27.03.2026, pertaining to Assessment Year (AY) 2025-26, wherein the assessee’s application seeking regularization of registration u/s 12AB has been rejected.

2.

None appeared on behalf of the assessee nor any adjournment application was filed. The LD DR has been heard and material available on record pursued.

ITA No. 7053 & 7052/Mum/2026; A.Y. 2025-26 Shree Kutchi Sarvoday Nagar Achalgaccha Jain Sangh

3.

The contents of the ld. CIT(E) order dated 18.09.2025 reads as under:

1.

M/s SHREE KUTCHI SARVODAY NAGAR ACHALGACHHA JAIN SANGH [hereafter 'the applicant'] filed application in Form 10AB on 01.03.2025 seeking registration under section 12AB of the Income Tax Act [hereafter 'the Act']. 2. On verification of the application in Form 10AB filed by the applicant, it was found that the application was not complete, and all the documents required to be accompanying the application were not furnished. Hence, a notice was issued to the applicant vide DIN & Notice No. ITBA/EXM/F/EXM43/2025-26/1078213672(1) dated 05.07.2025 requesting the applicant to furnish the complete set of documents mentioned in Rule 17A(2). In response, the applicant has filed its submission online vide letter dated 16.07.2025. 3. On perusal of the Form 10AC dated 31.03.2023, it has been observed that the applicant was granted Provisional Registration under Section 12A of the Act, which is valid for the period of three years from A.Y. 2023-24 to A.Y. 2025-26. As the trust is provisionally registered, the application for regularization of provisional registration Order ought to be filed under section 12(A)(1)(ac) (iii) of the Act. For reference, the provision of section 12A(1)(ac)(iii) is reproduced as under: "(iii) where the trust or institution has been provisionally registered under section 12AB, at least six months prior to expiry of period of the provisional registration or within six months of commencement of its activities, whichever is earlier," 4. However, on perusal of the above Form 10AB filed by the applicant it was observed that the assessee has applied under section 12A(1)(ac) (ii) of the Act which is valid only for trusts already having regular registration for five years and is seeking renewal of regular registration which is due to expire. The assessee, having provisional registration for three years, does not qualify to make the application under section 12A(1)(ac)(ii) of the Act. Thus, the application for registration in Form 10AB filed by the assessee is not allowable on the grounds of application filed under wrong section. However, following the principles of natural justice, an opportunity was provided to the applicant vide show cause notice having DIN & Notice No. ITBA/EXM/F/EXM43/2025- 26/1080354436(1) dated 04.09.2025 to show cause why the application in Form 10AB should not be rejected on the grounds of application filed under wrong section. 4.1 In response to the above Notice, vide letter dated 10.09.2025, the applicant has admitted that by mistake the application (Form 10AB) has

ITA No. 7053 & 7052/Mum/2026; A.Y. 2025-26 Shree Kutchi Sarvoday Nagar Achalgaccha Jain Sangh been filed under wrong Section and further requested to consider the application in their favour and allow the registration for the further period. 4.2 The applicant has already admitted that the application has been filed under wrong clause/section and as there is no provision under the Act, which allows the rectification/amendment in the clause under which the application has been filed. Therefore, the instant application is liable to be rejected. 4.3 In view of the facts and circumstances as discussed above, the aforesaid application for registration in Form 10AB filed by the assessee is not allowable on the grounds of application filed under wrong section and the same is rejected. However, the applicant is at liberty to pursue the remedies available in Statute, without any prejudice. 5. For statistical purposes, this application is not maintainable and stands rejected.” 4. The contents of the ld. CIT(E) order dated 27.03.2026 reads as under:

“M/s SHREE KUTCHI SARVODAY NAGAR ACHALGACHHA JAIN SANGH (hereafter 'the applicant'] filed application in Form 10AB on 30.09.2025 seeking regularization of provisional registration under Section 12A(1)(ac) (iii) of the Income Tax Act [hereafter 'the Act']. 2. On verification of the application in Form 10AB filed by the applicant, it was found that the application was not complete, and all the documents required to be accompanying the application were not furnished. Hence, a notice was issued to the applicant vide Notice dated 30.01.2026 requesting the applicant to furnish the complete set of documents mentioned in Rule 17A(2). In response to the above Notice, the applicant made submission vide letter dated 05.02.2026 and furnished the relevant details and documents. 3. On perusal of the above submission, details and documents attached by the applicant with Form 10AB and data available on ITBA/CPC portal, it has been observed that the applicant was granted regular registration in Form 10AC on 24.09.2021, under Section 12A of the Act, which is valid for the period of five years from A.Y. 2022-23 to A.Y. 2026-27. As the trust was granted regular registration, the application for renewal of regular registration Order ought to be filed under Section 12(A)(1)(ac)(ii) of the Act. For reference, the provision of section 12A(1)(ac)(ii) is reproduced as under: "(ii) where the trust or institution is registered under section 12AB, and the period of the said registration is due to expire, at least six months prior to the expiry of the said period."

ITA No. 7053 & 7052/Mum/2026; A.Y. 2025-26 Shree Kutchi Sarvoday Nagar Achalgaccha Jain Sangh 3. However, on perusal of the above Form 10AB filed by the applicant it was observed that the assessee has applied under section 12A(1)(ac) (iii) of the Act which is valid only for trust/institution having provisional registration for three years and seeking regularization of provisional registration which is due to expire. The assessee, having regular registration for five years, does not qualify to make the application under section 12A(1)(ac)(iii) of the Act. Thus, the subject application in Form 10AB for registration u/s 12A filed by the assessee is not allowable on the grounds of application filed under wrong section. 4. In view of the above facts, the aforesaid application for registration in Form 10AB filed by the assessee is not allowable on the grounds of application filed under wrong section/clause and accordingly, the same is rejected. However, the applicant is at liberty to pursue the remedies available in Statute, without any prejudice. Further, it is clarified that regular registration granted to the applicant u/s 12AB vide above mentioned Order in Form 10AC dated 24.09.2021 shall continue to remain valid from A.Υ. 2022-23 to A.Υ. 2026-27. 5. For statistical purposes, this application is not maintainable and stands rejected on the grounds of application filed under wrong Section/clause of the Income Tax Act.” 5. The ld. DR submitted that the applications have been rejected by the ld. CIT(E) for the reason that the application have been filed under wrong section.

6.

On perusal of the order passed by the ld. CIT(E) dated 18.09.2025, it is noted that the ld. CIT(E) has stated that the assessee having provisional registration for three years, doesn’t qualify to make application u/s 12A(1)(ac)(ii) of the Act and hence, the application so made was rejected. Further, in the second order dated 27.03.2026, it is noted that the ld. CIT(E) has stated that the assessee having regular registration for five years, doesn’t qualify to make application u/s 12A(1)(ac)(iii) of the Act and hence, the application so made was rejected. We therefore find that the assessee had filed two applications and each of the two applications have been rejected for the reason that the same has been filed under the wrong provisions. We find that where the contents of the application and underlying documentation are on record,

ITA No. 7053 & 7052/Mum/2026; A.Y. 2025-26 Shree Kutchi Sarvoday Nagar Achalgaccha Jain Sangh the matter may be examined by the ld. CIT(E) and the fact that the assessee has invoked wrong provisions while moving the application should not come in the way of seeking the regular registration/renewal of its registration as the case may be. It is not even a case where the assessee has kept quiet after the first rejection, and has taken efforts to file another application which has again been rejected on the said technical grounds rather than on any substantive grounds. We therefore deem it appropriate to set aside the matter to the file of the ld. CIT(E) to ascertain the correct factual position, and thereafter, decide the application afresh as per law after providing reasonable opportunity to the assessee.

7.

In the result, both the appeals filed by the assessee are allowed for statistical purposes.

Order pronounced in the Open Court on 16.10.2026

Sd/- Sd/- ANIKESH BANERJEE VIKRAM SINGH YADAV (JUDICIAL MEMBER) (ACCOUNTANT MEMBER)

Mumbai, Dated: 16.10.2026 Karishma J. Pawar, SR. PS

Copy to : ) The Appellant 2) The Respondent 3) The CIT concerned 4) The D.R, ITAT, Mumbai 5) Guard file By Order ABHINAV ANANT Digitally signed by ABHINAV ANANT GAVANDE GAVANDE Date: 2026.10.28 11:38:33 +05'30' Dy./Asst. Registrar I.T.A.T, Mumbai

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