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Facts
The assessee, a section 8 non-profit company, applied for registration under Section 12AB of the IT Act. The CIT rejected the application because the assessee submitted a provisional registration copy instead of a regular registration copy and applied under the wrong clause (ii) instead of (iii) of Section 12A(1)(ac).
Held
The Tribunal held that the error in filing the application under the wrong clause was a technical mistake, likely due to an inadvertent error or unavailability of the correct tab. Following previous decisions, the Tribunal found the error to be curable.
Key Issues
Whether a technical error in selecting the wrong sub-clause for filing an application for registration under Section 12A(1)(ac) is a curable defect, and if so, should the matter be remanded to the CIT for fresh adjudication.
Sections Cited
12AB, 12A(1)(ac), 17A(2)(e)
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Income Tax Appellate Tribunal, PUNE BENCH “A”, PUNE
Before: SHRI R. K. PANDA & SHRI VINAY BHAMORE
आदेश /ORDER
PER VINAY BHAMORE, JM:
This appeal filed by the assessee is directed against the order dated 30.09.2024 passed by Ld. CIT, Exemption, Pune rejecting the application for registration u/s 12AB of the IT Act.
Facts of the case, in brief, are that the assessee is a section 8 non-profit company applied for registration in Form 10AB u/s 12A(1)(ac)(ii) of the IT Act on 28.03.2024. With a view to verify the genuineness of the activities of the assessee and compliance to requirements of any other law for the time being in force by the trust/institution as are material for the purpose of achieving its objects, a notice dated 21-05-2024 was issued through ITBA portal requesting the assessee to upload various information detailed in notice. In compliance to the above notice, desired information was furnished by the assessee trust. Since various discrepancies were noticed including that the application is not under appropriate clause, another notice was issued by Ld. CIT, Exemption, Pune on 08.07.2024. Not being satisfied with the compliance made by the assessee, Ld. CIT, Exemption, Pune rejected the application for registration by observing as under :-
“6. On verification of the details / documents submitted by the assessee in response to the said notice, it is seen that the assessee has not furnished the copy of REGULAR REGISTRATION in form No. 10AC under section 12AB read with section 12A(1)(ac)(i) or 12A(1)(ac)(iii) of the Income Tax Act, 1961 but submitted a copy of PROVISIONAL REGISTRATION under section 12AB read with section 12A(1)(ac)(vi) of the Income Tax Act, 1961.
7. The present application is filed by the assessee under clause (ii) of section 12A(1)(ac) of the Income Tax Act, 1961. The provisions of clause (ii) of section 12A(1)(ac) are related to application for renewal of regular registration of a trust or institution which is already having regular registration under section 12AB of the Act and the period of said registration is about to expire.
The assessee was specifically requested vide the initial notice to furnish the copy of order of regular registration under section 12AB of the Income Tax Act, 1961. Such copy is actually required to be furnished along with the application itself under the provisions of Rule 17A(2)(e) of the Income Tax Rules, 1962. However, the assessee has neither submitted the same along with the application nor in response to the notice issued in this regard. Thus the assessee failed to furnish the same. The copy of order submitted by the assessee is a copy of provisional registration under section 12AB read with clause (vi) of section 12A(1)(ac) of the Income Tax Act, 1961 and not a copy of regular registration under section 12AB read with clause (i) or clause (III) of section 12A(1)(ac) of the Income Tax Act, 1961.
The non-submission of copy of order of regular registration under section 12AB of the Income Tax Act, 1961 establishes the fact that the prerequisite for application under clause (ii) of Section 12A(1)(ac) of the Income Tax Act, 1961 is not fulfilled in this case. Therefore, prima-facie it appears that the application is not maintainable.
10. In view of the above, the application filed by the assessee is treated as non-maintainable and hence, „rejected‟ for statistical purpose without going into the merits of the case and no adverse inference is drawn against the assessee.”
6. It is this order against which the assessee is in appeal before this Tribunal.
Ld. AR appearing from the side of the assessee submitted that the rejection order passed by Ld. CIT, Exemption, Pune is unjustified. It was submitted that due to an inadvertent error the application was filed u/s 12A(1)(ac)(ii), whereas the assessee was required to file application u/s 12A(1)(ac)(iii) of the IT Act. It was further submitted that application was filed by its own without help of any tax professional and due to this the above mistake occurred. Accordingly, it was prayed before the Bench that mentioning of wrong section code in the application is curable defect and one opportunity may kindly be provided to the assessee trust to explain his case before Ld. CIT, Exemption, Pune. In support of above contention, Ld. AR relied on the decision passed by Co-ordinate Bench of this Tribunal in the case of Shree Swaminarayan Gadi Trust vs. CIT, [2024] 162 taxmann.com 772 (Surat-Trib.) order dated 13.05.2024 wherein under identical situation Tribunal was pleased to allow the appeal of the assessee. Ld. AR further relied on another decision of the Co-ordinate Bench of this Tribunal in the case of Raj Krishan Jain Charitable Trust in order dated 05.06.2024, wherein under similar circumstances, the Tribunal was pleased to allow the appeal of the assessee. Accordingly, Ld. AR requested before the Bench to set-aside the order passed by Ld. CIT, Exemption, Pune and further requested to direct Ld. CIT, Exemption, Pune, to consider the application as filed under clause (iii) of section 12A(1)(ac) of the IT Act.
Ld. DR appearing for the Revenue relied on the order passed by Ld. CIT, Exemption, Pune and requested to confirm the same.
We have heard Ld. Counsels from both the sides and perused the material available on record and also copy of case laws relied on by the assessee. We find that admittedly, the assessee trust was required to file application under clause (iii) of section 12A(1)(ac) of the IT Act but due to inadvertent error/unavailability of particular tab the application was filed under clause (ii) of section 12A(1)(ac) of the IT Act and for this reason alone Ld. CIT, Exemption, Pune rejected its application for registration. We find that under identical situations, a Co-ordinate Bench of this Tribunal in the case of Raj Krishan Jain Charitable Trust (supra) allowed the appeal of the assessee by observing as under :-
“9. As contended the appellant has committed a technical mistake in making the application under Section 12A(1)(ac)(ii) instead of clause (iii) of clause (ac) of sub-section (1) of section 12A of the Act. As pointed out the appellant has filed revised form 10AB for seeking registration under the correct provision i.e. Section 12A(1)(ac)(iii) which can also be considered.
In consonance with the decision rendered by the co-ordinate Bench, the typographical error deserves to be corrected. Accordingly, the appeal deserves to be allowed and impugned order dated 15.03.2024 of Ld. CIT (E) is liable to be set aside. Hence, the appeal is allowed and we set aside the order of Ld. CIT(E) dated 15-03-2024 and remand the matter back to the file of the CIT(E) for fresh adjudication by considering amended application of the appellant under Section 12A(1)(ac)(iii) of the Act, or he can call for amended application from the appellant.
In the result, the appeal filed by the assessee is allowed for statistical purpose.”
Respectfully following the above decision passed by the Co- ordinate Bench of this Tribunal (supra), we find force in the arguments of Ld. Counsel of the assessee & considering the totality of the facts of the case & in the interest of justice we deem it proper to set-aside the order passed by Ld. CIT, Exemption, Pune and remand the matter back to him with a direction to treat the application already filed by the assessee as under clause (iii) of section 12A(1)(ac) of the IT Act (or as desired) instead of under clause (ii) of section 12A(1)(ac) of the IT Act and decide the same as per fact and law after providing reasonable opportunity of hearing to the assessee. The assessee is also hereby directed to respond to the notices issued by Ld. CIT, Exemption, Pune in this regard and produce supporting documents/evidences in support of application for registration, otherwise, Ld. CIT, Exemption, Pune shall be at liberty to pass appropriate order as per law. Thus, the grounds of appeal filed by the assessee are partly allowed.
In the result, the appeal filed by the assessee is allowed for statistical purposes.
Order pronounced on this 29th day of April, 2025.