SRI SRI AVANI SRINGERI JAGADGURU SHANKARACHARYA MAHASAMSTHANAM,BENGALURU vs. COMMISSIONER OF INCOME TAX (EXEMPTIONS), BENGALURU

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ITA 413/BANG/2025Status: DisposedITAT Bangalore08 September 2025AY 2024-25Bench: SHRI WASEEM AHMED (Accountant Member), SHRI KESHAV DUBEY (Judicial Member)1 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that rejecting an application solely on the ground of a wrong code, without considering the merits of eligibility, is not justified. It relied on a CBDT circular and a High Court judgment emphasizing a liberal and purposive approach.

What were the facts?

The assessee filed an application for registration under section 12AB of the Income-tax Act, 1961, in Form 10AB. The CIT(E) rejected the application because the assessee mentioned the wrong code in the form.

What were the issues?

Whether rejection of registration application under section 12AB solely for mentioning a wrong code is justified, disregarding substantive compliance.

Which sections of the Income-tax Act were involved?

Section 12AB

AI-generated summary — verify with the full judgment below

Cases cited in this judgment(1)Show list

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  • 161 Taxmann.com 311
    161 Taxmann.com 311 · 2024
    10 citing

Income Tax Appellate Tribunal, ‘A’ BENCH, BANGALORE

Before: SHRI WASEEM AHMED & SHRI KESHAV DUBEY

For Appellant: Shri Narendra Sharma, Advocate
For Respondent: Shri Murali Mohan, CIT (DR)
Hearing: 17.06.2025Pronounced: 08.09.2025

PER WASEEM AHMED, ACCOUNTANT MEMBER:

1.

This appeal by the assessee is directed against the order of the learned Commissioner of Income Tax (Exemption) [CIT(E)], dated 28.12.2024, rejecting the assessee’s application for registration under section 12AB of the Income-tax Act, 1961.

2.

The only issue raised by the assessee is that the learned CIT- exemption erred in denying the registration application made by the assessee under section 12 AB of the Act on the ground that such application was made under the wrong code.

3.

The assessee filed an application in Form No. 10AB dated 29.06.2024 seeking registration under section 12AB of the Act. The learned CIT(E) rejected the application on the ground that the assessee had mentioned the wrong code in the form 10AB.

4.

The assessee, being aggrieved, has preferred this appeal before us.

5.

The learned Authorised Representative (AR) submitted that the assessee had filed a paper book running from pages 1 to 98. He relied upon CBDT Circular No. 7/2024 dated 25.04.2024. As per this circular, the CBDT has clarified that the application should not be rejected merely because of mentioning a wrong code in Form 10AB. The AR therefore prayed that the matter be restored to the file of the ld. CIT(E) for fresh examination on merits, rather than rejection on a technical ground.

6.

The learned Departmental Representative (DR) opposed the plea of the assessee. He relied upon the order of the Visakhapatnam Bench of the Tribunal in the case of Mathrusri Mahila Mandali Tetali vs. CIT (Exemption) [172 Taxmann.com 651, order dated 17.01.2025], wherein the Tribunal had dismissed a similar appeal. He accordingly supported the order of the ld. CIT(E).

7.

We have carefully considered the rival submissions and perused the material on record. The undisputed fact is that the assessee filed the application in Form 10AB on 29.06.2024. The only reason for rejection was that the assessee had chosen the wrong code in the application.

At this stage, it is important to note CBDT Circular No. 7/2024 dated 25.04.2024. The circular clearly directs that the Commissioner of Income Tax (Exemption) should not reject applications under section 12AB merely due to the wrong selection of code. The circular emphasizes that substantive compliance should not be defeated for a technical mistake.

7.1 We also find support from the judgment of the Hon’ble Orissa High Court in [161 Taxmann.com 311], where it was held that mere technical errors in the application process cannot be a ground to deny substantive statutory benefits to an assessee when otherwise eligible. The Hon’ble Court observed that the tax authorities must adopt a liberal and purposive approach while considering applications under section 12AB of the Act.

7.3 As regards the decision relied upon by the learned DR in Mathrusri Mahila Mandali Tetali (supra), we find that the facts therein were distinguishable and, in any event, subsequent binding circulars and judicial pronouncements, including the above decision of the Hon’ble Orissa High Court, tilt the balance in favour of the assessee.

7.4 Therefore, in the present case, the rejection of the application solely on the ground of wrong code, without considering the merits of eligibility of the assessee under section 12AB, is not justified. In view of the above discussion, we set aside the order of the learned CIT(E). The matter is restored to his file with a direction to examine the application afresh on merits, in accordance with law, and after giving due opportunity of hearing to the assessee. The assessee is also directed to . co-operate in the proceedings. The appeal filed by the assessee is allowed for statistical purposes.

8.

In the result, the appeal filed by the assessee is allowed for statistical purposes.

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