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Facts
The assessee, a charitable trust, applied for regular registration under section 12AB. The CIT(E) rejected the application citing a lack of documentary evidence for charitable activities and discrepancies. The assessee filed an appeal before the tribunal after a delay.
Held
The Tribunal condoned the delay of 159 days, accepting the assessee's explanation of communication gap and lack of sufficient knowledge. On merits, the Tribunal found that the assessee had complied with notices and decided to grant one more opportunity.
Key Issues
Whether the delay in filing the appeal should be condoned and whether the assessee should be granted another opportunity to provide evidence for registration.
Sections Cited
12AB, 12A(1)(ac)(iii), 12A(1)(ac)(vi)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, PUNE BENCHES “B”, PUNE
Before: DR.MANISH BORAD & SHRI VINAY BHAMORE
आदेश / ORDER
PER DR. MANISH BORAD, ACCOUNTANT MEMBER :
The captioned appeal at the instance of assessee is against the order dated 26.07.2024 rejecting the application for regular registration u/s.12AB(1)(ac)(iii) of the Income-tax Act, 1961.
Registry informed that there is delay of 159 days in filing the appeal before this Tribunal. Application for condonation of delay has been filed stating as under :
“1. That I am a Trustee of Swargiya Shriman Shankarlalji Randad Charitable Trust since 01/04/2017. The Trust was registered under Bombay Public Trust Act on 19/02/1994 as a Public Charitable Trust. The Trust was formed to carry out objects of Medical and Educational help to needy and poor people. 2. That the Trust was provisionally registered with Income tax Act on 27.05.2021 and applied for Final Registration in Form 10AB on 15.01.2024.
3. That the CIT Exemption Pune vide an order u/s. 12A(1)(ac) dated 26.07.2024 rejected the application.
4. I state that the limitation for filing of the present appeal expired on 25.09.2025 and the appeal was to be filed on 03.03.2025. There is a delay of 159 days in filing of the present appeal.
5. That the other Trustees of the Trust are senior citizens and had no sufficient knowledge of Income Tax Proceedings. I am looking after the activities of the Trust including the Tax obligations. I reside in Pune and Trust is established and located in Mahabaleshwar District Satara. The Tax Consultant of the Trust is based in Satara City. When the Order of rejection was passed, due to the geographical between myself and the Tax Consultant there remained a communication gap. The further remedies were to be explored after seeking further advice. On advice, the appeal before Income Tax appellate Tribunal was filed. 6. I humbly state that the delay in filing of the present appeal is bonafide and for the reasons beyond the control of the appellant. A prayer is made to Hon Income Tax appellate Tribunal Pune Bench in the interest of justice to condone the delay and decide the appeal on merits.
We have heard both the sides and gone through the averments made in the condonation application. Hon’ble courts in plethora of judgments observed that when consideration of an appeal on merits is pitted against the rejection of a meritorious claim on the technical ground of the bar of limitation, the Courts lean towards consideration on merits by adopting a liberal approach towards ‘sufficient cause’ to condone the delay. The Court considering an application under section 5 of the Limitation Act may also look into the prima facie merits of an appeal. A liberal approach may be adopted when some plausible cause for delay is shown. Hon’ble Supreme Court in the case of Inder Singh Vs. State of Madhya Pradesh judgment dated 21.03.2025 (2025 INSC 382) condoned delay of 1537 days sub- serving the cause of justice. It was held so while observing that the second appeal filed by the appellant was unintentional, much less due to any deliberate laches, and was well-explained by the State before the High Court. Hon’ble Court further held that in cases where the merits are significant, a more liberal approach may be adopted to allow for the examination of the case on its merits. Having gone through the averments made in the condonation application and considering the ratio laid down by the Hon’ble Court in the case of Inder Singh (supra), we are of the view that there was ‘reasonable cause’ which prevented the assessee in filing the appeal within the stipulated time. We therefore condone the delay of 159 days and admit the appeal for adjudication.
3.1 On merits of the case, ld. Counsel for the assessee submitted that assessee has not filed necessary details before ld.CIT(A) which resulted in rejection of the application filed for regular registration. Therefore, a prayer is made to give one more opportunity to the assessee to go before ld.CIT(E) and submit the requisite details. Ld. Departmental Representative did not oppose this request.
After hearing both the sides and on perusal of the impugned order, we notice that assessee filed an application for registration u/s.12A(1)(ac)(iii) of the Act by filing Form 10AB on 15.01.2024. Thereafter, ld.CIT(E) vide notice dated 26.03.2024 called for various details as mentioned in pages 3 to 7 of the impugned order. Ld.CIT(E) issued another notice dated 10.07.2024 pointing out certain discrepancies in the information so filed to which also assessee has furnished response. However, ld.CIT(E) rejected the application for registration u/s.12AB holding as under :
“However, the assessee's claim of said charitable activities are not documentary evidence such as supported by any bills/ vouchers/invoices/photographs. Also, there are no details of any beneficiaries/students supported by the claimed charitable activities of the assessee trust. The assessee has furnished only 4 photographs which depict a peoples gathering which is being addressed by the guest on stage. The assessee has claimed that cheques are issued to students for ST pass (bus pass) and books, notebooks, uniforms are also distributed. Also, medical aid is provided to needy students. If that is the case, the assessee should have furnished details of beneficiary students to whom cheques have been issued for pass or could have reconcile activity with the bank statement. Similarly, details of students to whom medical aid was provided should have been provided. No supporting evidence are furnished by the assessee to support its contention.
6. Considering the above, the undersigned is not satisfied about the genuineness of activities of the assessee and compliance of requirements of any other law for the time being in force by the assessee as are material for the purpose of achieving its objects.
In view of the above, the application filed by the assessee is hereby rejected and the provisional registration granted on 27/05/2021 under section 12AB read with section 12A(1)(ac) (vi) of the Income Tax Act, 1961 is hereby cancelled.”
Having heard both the sides and perusing the record placed before us and considering the fact that assessee has complied with all the notices issued by ld.CIT(E). However, taking cognizance of the partial compliance by the assessee and light of submission made by ld. Counsel for the assessee, we deem it appropriate to give one more opportunity to the assessee. In view thereof, the issue on merits is remitted back to the file of ld.CIT(E) for necessary adjudication. Needless to say that ld.CIT(E) shall afford reasonable opportunity to the appellant to prove the genuineness of the activities. Assessee can make necessary submissions with regard to the grounds of appeal raised before us. After considering the submissions of the assessee, ld.CIT(E) shall decide the assessee’s application in accordance with law by passing speaking order. Assessee is directed to provide latest email id and contact detail to the department for receiving the notices from ITBA portal. Assessee is also directed to remain vigilant and not to take adjournment unless otherwise required for reasonable cause. Impugned orders is set aside and the effective grounds of appeal raised by the assessee in the instant appeal is allowed for statistical purposes.
In the result, appeal of the assessee is allowed for statistical purposes.
Order pronounced on this 27th day of May, 2025.