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Facts
Purnima Bhadra Charitable Trust appealed against the CIT (Exemption)'s orders denying registration under Section 12A(1)(ac)(iii) and Section 80G(5)(iii) of the Income Tax Act, 1961. The rejection stemmed from the assessee's non-filing of Form 10A for Section 12A, despite filing Form 10AB for both sections, and already possessing perpetual registrations under Sections 12AA and 80G. The tribunal condoned an 18-day delay in filing the appeal, acknowledging the trust's lack of awareness regarding new legal changes.
Held
The Tribunal observed that the CIT(E) denied registration citing non-compliance and a procedural error, despite the trust being an old entity with existing registrations. Considering the interest of justice, the Tribunal set aside the CIT(E)'s orders and remanded the matter, instructing the CIT(E) to provide the assessee a fresh opportunity for a hearing and to present necessary submissions for proving its genuineness and exemption claim.
Key Issues
Whether the rejection of registration under Section 12A and Section 80G by the CIT (Exemption) based on a technical non-compliance (non-filing of Form 10A for Section 12A) was justified for an established charitable trust. A secondary issue was whether the assessee deserved another opportunity to rectify procedural lapses and present its case.
Sections Cited
12A(1)(ac)(iii), 80G(5)(iii), 12AA, 10A, 10AB, 10AC
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, KOLKATA ‘D’ BENCH, KOLKATA
Before: SHRI PRADIP KUMAR CHOUBEY & SHRI RAKESH MISHRA
PER RAKESH MISHRA, ACCOUNTANT MEMBER:
These appeals filed by the assessee are against the orders of the Ld. Commissioner of Income Tax (Exemption)-Kolkata [hereinafter referred to as the ‘Ld. CIT (Exemption)’] passed in respect of registration u/s 12A(1)(ac)(iii) and 80G(5)(iii) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) dated 19.12.2024. Both the appeals were heard together and are being decided vide this common order for the sake of convenience and brevity. I.T.A. Nos.: 537 & 538/KOL/2025 Assessment Year: N.A. Purnima Bhadra Charitable Trust.
The Registry has informed that both the appeals filed by the assessee are barred by limitation by 18 days. An application along with affidavit seeking condonation of delay has been filed by the assessee stating as under: “Purnima Bhadra Charitable Trust is in existence since 9th December 2011. Certification u/s 12AA and 80G orders for the perpetuity were issued on 1st August 2013. A copy of the Order is attached. Due to the amendment in the Income Tax Act, 1961 pertaining to Charitable Trust effective from 1st April 2020, Assessee filed form 10A pertaining to 80G(5) on 28th May 2022. However, Assessee didn't file form 10A pertaining to Sec 12A due to unawareness of the all the changes in law. However, Assessee did file form 10AB both for Sec 80G(5) and Sec 12A. CIT (Exmption) rejected form 10AB pertaining to Sec 12A due to non-filing of Form 10A on 19th December 2024. Although Assessee had provided all the documents as and when required except form 10AC (Provisional Approval for Sec 12A) as Assessee didn't file form 10A. After rejection of the form 10AB by CIT(Exmption), the only option left with the Assessee was to go for appeal. Unfortunately, there was no one in the Trust conversant with IT laws, and we decided to file appeal against the same. The Trust tried to file appeal before the Ld. CIT(Appeals), however it was informed by the auditor that we require to file appeal before the Income Tax Appellate Tribunal (ITAT) and not before CIT(Appeals). As there was no one capable enough to file appeal before ITAT, the Trust on advice of the Auditor approached Sri Raju Mukherjee CS, to prepare and file appeal before ITAT. He took some time to prepare the draft and finalise the ground, which resulted in a bit delay in filing the appeal. Thus, in the absence of proper guidance from a tax advisor the Assessee failed to adhere to 60 day's time limit for filing appeal before ITAT against CIT(Exemption)'s order. As a result, there was a delay to file the appeal which was supposed to be filed by 17th February 2025.”
Considering the application for condonation of delay and the reasons stated therein, we are satisfied that the assessee had a reasonable and sufficient cause and was prevented from filing the instant appeals within statutory time limit. We, therefore, condone the delay and admit the appeals for adjudication. I.T.A. Nos.: 537 & 538/KOL/2025 Assessment Year: N.A. Purnima Bhadra Charitable Trust.
The assessee is in appeal before the Tribunal raising the following grounds of appeal: ITA No. 537/KOL/2025:
“1. That the rejection of form 10AB for Sec 12A is arbitrary and not justified as Assessee had filed form 10AB for Sec 12A within the extended due date of 30th June 2024 vide circular no. 07/2024 dated 25.04.2024. 2. That the rejection was on the ground that the trust could not submit certificate in Form 10AC, which is issued only after filing form 10A (to get provisional registration). Non filing of form 10A is a technical error for which the registration u/s 12A should not be denied, and this should not be the basis to decide the genuineness of the trust when all other documents viz audited accounts etc were available with the learned CIT (Exemption).
That the Income tax department has provided form 10AC for the same trust when form 10A was filed afresh, hence non availability of form 10AC should not be the ground for denial of registration u/s 12A, The requirement of filing form 10A was newly inserted and this was required to be filed for 12A and 80G both, and the trust was not aware of the same, and filed the form for 80G only. Prior to this the trust had registration u/s 12AA and 80G which were valid till perpetuity. Rejection of registration for mere non filing of form 10A which is technical in nature will be too harsh for a small trust like us.
That the Trust is in existence since 9th December 2011 and Certification u/s 12AA and 80G orders were issued on 1 August 2013. A copy of the Order is attached.
That the appellant reserves the right to raise additional grounds during hearing.” ITA No. 538/KOL/2025:
“1. That the rejection of form 10AB for Sec 80G(5)(iii) is arbitrary and not justified as Assessee had filed form 10A and also 10AB for Sec 80G(5) within the extended due date of 30th June 2024 vide circular no. 07/2024 dated 25.04.2024. Mere non-filing of form 10A (to get provisional registration) for Sec 12A could not be a basis to reject form 10AB pertaining to 80G.
That the genuineness of the activities of the Trust was questioned in the Order (DIN ITBA/EXM/F/EXM45/2024-25/1071384124(1)) where Assessee's form 10AB pertaining to Sec 12A was rejected (Reference of that order is also attached). CIT (Exmption) also rejected form 10AB pertaining to Sec 80(G) (5) (iii) citing reason "in absence of regular registration u/s 12A, I.T.A. Nos.: 537 & 538/KOL/2025 Assessment Year: N.A. Purnima Bhadra Charitable Trust. approval cannot be given u/s 80G". Without examining the Audited Report and other documents provided questioning the genuineness of the activities of the Trust was unjustified.
That the rejection of form 10AB could lead to non-granting of 80G deduction to the donor(s).
That without prejudice to above ground the rejection of form 10AB without taking into account the history of Assessee is unjustified.
That the Trust is in existence since 9th December 2011 and Certification u/s 12AA and 80G orders were issued on 1st August 2013. A copy of the Order is attached.
That the appellant reserves the right to raise additional grounds during hearing.”
Rival contentions were heard and the submissions made have been examined. During the course of the appeal though the assessee sought adjournment, however, the Bench was of the view that the Ld. CIT(E) had denied the claim of exemption u/s 12A(1)(ac)(iii) as well as 80G(5)(iii) of the Act on account of non-compliance by the assessee, even though the assessee is an old trust and on account of wrong mention of the clause for the application filed, the registration was denied. Therefore, in the interest of justice, it was considered imperative that the assessee may be granted another opportunity to file proper submission in response to the notice issued by the Ld. CIT (Exemption) for justifying the genuineness of the activities and claim of exemption. Hence, both the orders of the Ld. CIT (Exemption) are set aside and the matter is remanded to him for deciding the application afresh after granting an opportunity of being heard to the assessee and seeking the reply from the assessee in respect of the queries raised and in accordance with law.
In the result, both the appeals filed by the assessee are allowed for statistical purposes. I.T.A. Nos.: 537 & 538/KOL/2025 Assessment Year: N.A. Purnima Bhadra Charitable Trust. Order pronounced in the open Court on 30th June, 2025. [Pradip Kumar Choubey] [Rakesh Mishra] Judicial Member Accountant Member Dated: 30.06.2025 Bidhan (P.S.) I.T.A. Nos.: 537 & 538/KOL/2025 Assessment Year: N.A. Purnima Bhadra Charitable Trust. Copy of the order forwarded to:
Purnima Bhadra Charitable Trust, Beladeep, Nandapally, Naihati, North 24 Parganas, West Bengal, 743165. 2. C.I.T., Exemption, Kolkata.
CIT(A)-
CIT-
CIT(DR), Kolkata Benches, Kolkata.
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