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Facts
The assessee filed an application for registration under Section 12AB and approval under Section 80G of the Income Tax Act, 1961. The CIT(E) rejected the application citing that the assessee had filed it under the incorrect clause and failed to respond to show cause notices.
Held
The Tribunal held that the rejection of the application on purely technical grounds without examining the merits of eligibility is not justified. The Tribunal condoned the delay in filing and remitted the matters back to the CIT(E) for fresh consideration.
Key Issues
Whether the rejection of registration/approval application solely on technical grounds without considering the merits, despite provisional registration and timely filing, is justified?
Sections Cited
12AB, 80G, 12A(1)(ac)(v), 12A(1)(ac)(iii), 12A, 80G(5)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, ‘C’ BENCH: CHENNAI
Before: SHRI SS VISWANETHRA RAVI & SHRI JAGADISH
आदेश / O R D E R
PER JAGADISH, A.M : Aforesaid appeals filed by the assessee arises out of the order of Learned Commissioner of Income Tax (Exemption), Chennai [hereinafter “CIT(E)”] dated 24.06.2024 & 25.06.2024 in rejecting the application in Form 10AB seeking registration u/s. 12AB and approval u/s 80G of the Income-tax Act, 1961 (hereinafter “the Act”).
& 1110/Chny/2025 NRG Foundation :- 2 -:
There is a delay of 233 days in filing both the appeals by the assessee. The assessee has filed condonation petitions/affidavits stating the reasons for delay in filing the appeals. We have considered the petitions/affidavits of delay in filing the appeals and satisfied that there was sufficient cause for not filing the appeals within the prescribed time limit. Hence, the delay is hereby condoned.
ITA No.1109/Chny/2025:
The effective ground of appeal in this appeal of assessee is against the rejection of application filed in Form No.10AB seeking registration u/s. 12A(1)(ac)(v) of the Act.
The assessee had been granted provisional registration in Form 10AC for the Assessment Years 2022–23 to 2024–25. Subsequently, the assessee-society has filed online application on 09.12.2023 in Form No.10AB seeking approval for registration u/s. 12A(1)(ac)(v) of the Act. However, the Ld. CIT(E) has rejected the application as the assessee in Form No.10AB has wrongly filed u/s. 12A(1)(ac)(v) instead of in Section 12A(1)(ac)(iii) of the Act.
& 1110/Chny/2025 NRG Foundation :- 3 -:
The Ld. Authorized Representative (A.R) of the assessee has stated that the Ld. CIT(E) has rejected the application without providing reasonable opportunity, therefore one more opportunity may be granted in the interests of justice to substantiate its claim. The Ld AR has also submitted that the assessee has filed application for renewal under incorrect clause, which is only procedural lapse and therefore, one more opportunity may be provided.
On the other hand, the Ld. Departmental Representative (DR), has relied on the orders of lower authorities.
We have heard the rival submissions, and perused the materials available on record. We find that the Ld. CIT(E) had rejected the assessee's application solely on the ground that it was filed under the incorrect clause of section 12A(1)(ac) of the Act. The Ld CIT(E) has rejected the application as the assessee had failed to reply the show cause notices. The fact remains that the assessee had been granted provisional registration and had filed the application within the prescribed time. In our considered view, the rejection of the application on a purely technical ground without examining the merits of the assessee’s eligibility is not justified. Considering the submissions and & 1110/Chny/2025 NRG Foundation :- 4 -:
in the interest of justice, we deem it fit to remit the matter back to the file of the Ld. CIT(E) for fresh consideration of the assessee's application in accordance with law, after affording a reasonable opportunity of being heard. The assessee is also directed to cooperate and rectify the procedural lapse, if any, in the application. In view of the above, the appeal filed by the assessee is allowed for statistical purposes only.
ITA No.1110/Chny/2025:
In this case, the Ld. CIT(E) had rejected the assessee’s application for approval u/s. 80G(5) of the Act on the ground that the assessee had not responded to the show cause notices issued and does not have registration u/s. 12A of the Act. Since we have already remitted the matter relating to registration u/s. 12A back to the file of the Ld. CIT(E) for fresh consideration, we are of the considered opinion that the issue of approval u/s. 80G(5) also requires reconsideration. Accordingly, we remit this matter as well to the file of the Ld. CIT(E) for fresh adjudication, after giving due opportunity to the assessee to clarify its objects and activities.
& 1110/Chny/2025 NRG Foundation :- 5 -:
In the result, both the appeals filed by the assessee is allowed for statistical purposes.
Order pronounced on 07th day of July, 2025 at Chennai.