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Facts
The assessee filed an application in Form 10AB seeking registration under Section 80G of the Income Tax Act. The Ld. CIT(E) rejected the application, stating that the assessee had claimed exemption in previous years and therefore, the application under Section 80G(5)(iv)(B) was not allowable.
Held
The Tribunal restored the issue to the file of the Ld. CIT(E) to consider the application afresh, treating it as filed under clause (iii) of the 1st proviso to Section 80G(5), and to decide the matter on its merits after giving the assessee a reasonable opportunity.
Key Issues
Whether the Ld. CIT(E) erred in rejecting the Section 80G registration application based on previous year's claims, without considering the amended provisions and the possibility of filing under a different clause due to a technical error.
Sections Cited
80G, 80G(5)(iv)(B), 80G(5), 10, 11, 12
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Income Tax Appellate Tribunal, MUMBAI “B” BENCH : MUMBAI
Natyakala Parampara The Commissioner of Income Tax Foundation, (Exemptions), B-307, Lilly Dosti Acres, vs. Room No. 601, #rd Floor, B-Wing 6th Floor, Wadala, Antop Hill, Cumballa Hill, Mumbai-400037 MTNL TE Building, Pedder Road, PAN : AAJCN0851E Cumballa Hill, Mumbai-400026 (Appellant) (Respondent) For Assessee : Shri Prashant Ghumare For Revenue : Shri Satyaprakash R.Singh, CIT-DR Date of Hearing : 26-06-2025 Date of Pronouncement : 27-06-2025 O R D E R PER VIKRAM SINGH YADAV, A.M : This is an appeal filed by the assessee against the order of the Ld. Commissioner of Income Tax (Exemptions)-Mumbai [„Ld.CIT(E)‟], dated 17-10-2024, wherein the assessee‟s application dt. 17-05-2024, seeking registration u/s. 80G of the Income Tax Act, 1961 („the Act‟) was rejected.
During the course of hearing, the Ld. AR taken us through the application filed by the assessee in Form 10AB under clause (iv)(B) of 1st proviso to Section 80G(5) of the Act, which is available at assessee‟s paper book (pgs. 36 to 41) and the impugned order so passed by the ld CIT(E) and it was submitted that as evident, the Ld.CIT(E) referring to the provisions of section 80G(5)(iv)(B) of the Act has stated that the assessee can file application in Form 10AB u/s. 80G(5)(iv)(B) where the assessee has not claimed exemption in previous years and since the assessee has claimed exemption in previous years, therefore, this application u/s. 80G of the Act is not allowable. Further, the assessee is not fulfilling the stipulated conditions prescribed for filing application for approval in Form 10AB and accordingly, the application was summarily rejected.
It was submitted that the Ld.CIT(E) has failed to take into consideration the amendment which has been brought in by the Finance Act, 2024 w.e.f. 01-10-2024 prior to the passing of the impugned order on 17-10-2024 wherein the condition of “no income or part thereof of the said institution or fund has been excluded from the total income on account of applicability of sub-clause (iv) or sub-clause (v) or sub-clause (vi) or sub- clause (via) of clause (23C) of section 10 or section 11 or section 12 for any previous year ending on or before the date of such application” has been deleted. It was submitted that the Ld.CIT(E) has apparently failed to take into consideration the amendment which has been brought in by the Finance Act, 2024 and has rejected the application seeking registration u/s. 80G of the Act.
Without prejudice, it was further submitted that even otherwise, the assessee fulfils the conditions under clause (iii) of 1st proviso to section 80G(5) and given that similar Form i.e., Form 10AB is required for seeking registration under clause (iii), it is only a technical error which could have been condoned by the Ld.CIT(E) in terms of filing the application under the wrong provision and the application of the assessee could have been examined on merits of the case. In this regard, our reference was drawn to Rule 11A; wherein the similar Form 10AB has been provided for seeking registration under clause (iii) or sub-clause (b) of clause (iv) of 1st proviso to sub-section 5 of Section 80G. It was accordingly submitted that the only prayer of the assessee is that merely on account of technical breach, the application has been rejected and no finding has been recorded on merits of the case and accordingly, the matter may be restored to the file of the Ld.CIT(E) to consider the application already filed in Form 10AB as filed under clause (iii) instead of clause (iv) of 1st proviso to sub-section 5 of Section 80G.
In support, reliance was placed on the following decisions of the Co-ordinate Benches of the Tribunal: i. Jai Minocher Ministry Memorial Foundation vs. CIT(E) – (2025) 171 taxmann.com 726 (Mumbai); ii. Vijayam Memorial Trust vs. CIT(E) (ITA No. 5596/Mum/2024); iii. Population First vs. CIT(E) (2025) 172 taxmann.com 288 (Mumbai); iv. Rotary Charity trust vs. CIT(E) (2025) 170 taxmann.com 797 (Mumbai) 6. Per contra, the Ld.CIT-DR is heard, who has submitted that the amendment by the Finance Act 2024 with effect from 01-10-2024 and therefore, at the time of filing the application, the pre-amended law will be applicable and the Ld.CIT(E) has rightly not considered the amended law and has decided the matter basis the existing law as on the date of filing of the application. At the same time, the Ld.CIT-DR didn‟t raise any specific objection where the matter is set aside to the file of the Ld.CIT(E) to decide the same on merits of the case.
After hearing both the parties and considering the material available on record and given the limited prayer raised on behalf of the assessee wherein all the relevant material is available on record in terms of Form 10AB for seeking registration under the relevant provisions of section 80G(5) of the Act, we deem it fit and appropriate to restore the issue to the file of the Ld.CIT(E) to consider the application already filed by the assessee as filed under clause (iii) of 1st proviso to section 80G(5) and to decide the matter afresh as per law, after providing reasonable opportunity to the assessee.