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Facts
The assessee, a charitable trust, applied for registration under Section 80G(5) of the Income Tax Act. The CIT(Exemption) rejected the application stating that the trust had claimed deduction u/s 11 and had not furnished a copy of its regular registration under Section 12AB prior to April 1, 2021. The trust argued that the relevant provision u/s 80G(5)(iv)(B) was omitted from the statute and that the required documents were inadvertently not submitted.
Held
The Tribunal noted that the assessee had inadvertently submitted incorrect certificates and that a relevant provision cited for rejection was omitted from the statute. The Tribunal decided to set aside the order to the file of the CIT(E) for fresh examination.
Key Issues
Whether rejection of application for registration u/s 80G(5) is justified when the ground cited was omitted from the statute and supporting documents were inadvertently not submitted.
Sections Cited
80G(5), 12AB, 124(1)(ac), 11, 80G(5)(iv)(B)
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Income Tax Appellate Tribunal, ‘G’ BENCH
Before: SHRI VIKRAM SINGH YADAV & SHRI RAHUL CHAUDHARY
आदेश / O R D E R PER VIKRAM SINGH YADAV (A.M): This is an appeal filed by the assessee against the rejection of its application seeking registration u/s. 80G(5) of the Act vide order passed by the Ld. CIT(Exemption) dated 27.11.2024, wherein the assessee has taken the following grounds of appeal:
1. 1. The learned CIT (Exemption) Pune has erred in rejecting the application of the Appellant Trust, despite the fact that all the documents asked for were duly submitted during the course of faceless proceedings before the CIT (Exemption).
Snehalaya Charitable Trust 2. The appellant craves leave to add, alter, amend, and modify the aforesaid grounds of appeal at or any time before the hearing as may be advised from time to time.”
During the course of hearing, the Ld. AR submitted that the Appellant is a Charitable Trust working for specially abled children. It undertakes workshops for the rehabilitation of speciallyabled children and also works for giving them meaningful employment. The Trust is 19 years old Trust which got registered with the charity commissioner under Maharashtra Public Trust Act on 20th of Feb. 2006.
It was submitted that the Trust had applied for the registration under sub clause (B) of (iv) of first proviso to sub section (5) of section 80G of the Income Tax Act 1961 on 30- 6-2024. However, its application was rejected by the ld. CIT Exemptions vide order dated 27th November 2024. The reasons for the rejection of the application given by the ld CIT Exemptions are as under: i) It is seen that you have obtained regular registration under section 12AB of the Act read with clause (i) of section 124(1)(ac) of the Act on 28-10-2021. However, the copy of regular registration under section 124/12AA of the Act prior to 01-04-2021 has not been furnished by you. Kindly furnish the same. ii) As per financial statements and ITRs filed by you, it is seen that the trust has claimed deduction u/s 11. Therefore, said provisions of sec. 80G(5)(iv)(B) of the Act are not applicable to your case. Please clarify with supporting documents.
It was submitted that the trust got its 12A registration on 26th February 2007. At that time, the name of the trust was Missionaries of Love Hope and Will Charitable Trust. The Snehalaya Charitable Trust name of the trust got changed from Missionaries of Love Hope and Will Charitable Trust to Snehalaya Charitable Trust. It was duly intimated to the Income Tax Department. The Income Tax Department noted the change and issued a certificate to that effect on 30th September 2010. Copies of the said certificates are enclosed herewith. The said certificates were asked during the faceless proceedings, however inadvertently the appellant submitted the copy of its regular registration certificate. Thus although the appellant trust was having the necessary certificates unfortunately its application was rejected due to the non submission of the aforesaid certificates. Since the appellant trust is a 19 year old trust working for specially able children, the appellant hereby request to give a fresh opportunity to the Appellant for submitting the necessary documents.
It was submitted that the learned CIT (Exemptions) has further stated that "it is seen that the trust has claimed deduction u/s 11, Therefore, said provisions of sec. 80G(5)(iv) (B) of the Act are not applicable to your case. Please clarify with supporting documents." In this regard, the appellant would like to bring your kind attention to the fact that the said provisions have been omitted from the statue with effect from 1" day of October 2024. This was done as rationalization measures by the Finance Act 2024. Thus the said condition is no longer there in the statue & therefore the same cannot be the reason for denial of exemptions. Considering the
It was accordingly submitted that the appellant’s application was rejected just because of the above discussed two reasons. Otherwise the application was in order. As explained earlier, the trust is a very old trust and inadvertently, the certificate asked for by the ld CIT(E) were not submitted during the faceless proceedings. Further, as explained, the condition stated in the rejection order has already been omitted by the Finance Act 2024 w.e.f. 1" of October 2024. Considering the facts stated above, the appellant humbly request you to give another opportunity to the appellant by remanding the matter for considering afresh to the ld CIT Exemptions.
The Ld. DR was heard who has relied in the order so passed by the Ld. CIT(Exemption). At the same time, he didn’t specifically objected where the matter is set-aside to the file of ld CIT(Exemption).
Heard both the parties and purused the material available on record. As submitted by the ld AR, the assessee couldn’t submit the certificate so sought by the ld CIT(E) and had submitted other certificates inadvertently. However, given that these certificates have been issued earlier by the Revenue and are part of the records and a copy thereof has since been placed on record, we deem it appropriate that the matter is Snehalaya Charitable Trust set aside to the file of the ld CIT(E) to examine the same. Further, the ld AR has pointed out the amendment which has been brought in by the Finance Act 2024 which apparently has not been taken into consideration by the ld CIT(E) while examining the application so filed by the assessee. The matter is accordingly set-aside to the file of ld CIT(E) to examine the same afresh as per law after providing reasonable opportunity to the assessee.
In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in open court on 28.03.2025.