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Facts
The assessee, a charitable trust, applied for registration under Section 12A(1)(ac)(iii) of the Income Tax Act. The CIT (Exemption) rejected the application, stating that the provisional registration was incorrectly filed under Section 12A(1)(ac)(vi)(A), which was not applicable as the trust's activities commenced in 2000, prior to the provisional application date.
Held
The Tribunal noted that CBDT Circular No. 7/2024 addresses difficulties, including filing under wrong section codes, and provides relief. Relying on its own previous decisions where such errors were considered curable technical mistakes, the Tribunal set aside the CIT's rejection order. The case was remanded to the CIT (Exemption) for fresh adjudication, treating the application as filed under the correct section and providing the assessee a reasonable opportunity to be heard.
Key Issues
Whether the rejection of a trust's registration application solely due to filing under an incorrect section code, despite CBDT circulars providing relief for such technical errors, is justified.
Sections Cited
12AA, 12A, 119, 10(23C), 80G, 35
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Income Tax Appellate Tribunal, PUNE BENCH “A”, PUNE
Before: SHRI R. K. PANDA & SHRI VINAY BHAMORE
Kai Sau Pramilabai Vs. CIT, Exemption, Pune. Ramkrishna Mirajkar Charitable Trust, 1731, Tiwandha, Jeevan Prakash, Narhar Niwas, Near Bhadrakali Mandir, Nashik- 422001. PAN : AAATK4064A Appellant Respondent Assessee by : Shri Pramod S. Shingte Revenue by Shri Amol Khairnar : Date of hearing : 11.02.2025 Date of pronouncement : 25.02.2025 आदेश / ORDER
PER VINAY BHAMORE, JM:
This appeal filed by the assessee is directed against the order dated 17.10.2024 passed by Ld. CIT, Exemption, Pune rejecting the application for registration u/s 12AA of the IT Act.
Facts of the case, in brief, are that the assessee is a trust applied for registration in Form 10AB under clause (iii) of section 12A(1)(ac) of the IT Act on 23.04.2024. With a view to verify the genuineness of 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 04.06.2024 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. Ld. CIT, Exemption, Pune found that the provisional registration application was furnished u/s 12A(1)(ac)(vi)(A) of the IT Act whereas the same was not applicable since the activities were commenced in the year 2000 much prior to the date of provisional registration application i.e. 29-03-2024. Accordingly, a notice dated 05.10.2024 was issued to the assessee to submit clarification in this regard. Not being satisfied with the explanation furnished by the assessee, in response to notice dated 05.10.2024, Ld. CIT, Exemption, Pune rejected the application for registration. It is this order against which the assessee is in appeal before this Tribunal.
3. Ld. AR appearing from the side of the assessee submitted before us that the rejection order passed by Ld. CIT, Exemption, Pune is unjustified. It was submitted that the application for final registration was rightly filed u/s 12A(1)(ac)(iii), only the 12A(1)(ac)(vi)(A) was filed under wrong section code. It was further submitted that there was no other option except to apply for provisional registration under clause (A), & due to this reason the application for provisional registration was filed under the available clause, otherwise the application could not have been filed. It was further submitted that CBDT in its Circular No.7/2024 issued on 25.04.2024 in para 4.1 has already dealt with this issue & cleared all the doubts. Ld. Counsel further submitted that the assessee trust is genuine and an old trust, registered u/s 12A by Commissioner of Income Tax, Pune. 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 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 rightly filed under clause (iii) of section 12A(1)(ac) of the IT Act.
4. Ld. DR appearing for the Revenue relied on the order passed by Ld. CIT, Exemption, Pune and requested to confirm the same. It was also pointed out by him that the circular provided window for a certain period only.
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 the reason that the provisional registration application was filed under clause (vi)(A) of section 12A(1)(ac) of the IT Act, Ld. CIT, Exemption, Pune rejected its application for registration. In this regard, we find that looking to the difficulties faced by various trusts, CBDT in its circular No.7/2024 issued on 25-04-2024 has provided certain relaxation to the trusts, although CBDT are very much clear, the relevant circular is produced herewith :- “Circular No.7/2024 F. No. 173/25/2024-ITA-I Government of India Ministry of Finance Department of Revenue Central Board of Direct Taxes New Delhi, Dated 25th April, 2024 Sub: Extension of due date for filing of Form No. 10A/10AB under the Income-tax Act, 1961- reg. On consideration of difficulties reported by the taxpayers and other stakeholders in the electronic filing of Form No.10A/10AB, the Central Board of Direct Taxes (the Board) in exercise of its powers under section 119 of the Income-tax Act, 1961 (the Act) extended the due date for filing Form No. 10A to 31.08.2021 by Circular No. 12/2021 dated 25.06.2021, to 31.03.2022 by Circular No.16/2021 dated 29.08.2021, to 25.11.2022 by Circular No. 22/2022 dated 01.11.2022 and further to 30.09.2023 by Circular No. 6/2023 dated 24.05.2023, and extended the due date for filing Form No.10AB to 30.09.2022 by Circular No. 8/2022 dated 31.03.2022 and further to 30.09.2023 by Circular No. 6/2023 dated 24.05.2023.
2. Representations have been received in the Board with a request to condone the delay in filing Form No.10A/10AB, as the same could not be filed in such cases within the last extended date, i.e., 30.09.2023.
On consideration of the matter, with a view to avoid and mitigate genuine hardship in such cases, the Board, in exercise of the powers conferred under section 119 of the Act, hereby extends the due date of making an application/intimation electronically in - (i) Form No. 10A, in case of an application under clause (i) of the first proviso to clause (23C) of section 10 or under sub-clause (i) of clause (ac) of sub-section (1) of section 12A or under clause (i) of the first proviso to sub-section (5) of section 80G or in case of an intimation under fifth proviso of subsection (I) of section 35 of the Act, till 30.06.2024; (ii) Form No. 10AB, in case of an application under clause (iii) of the first proviso to clause (23C) of section 10 or under sub-clause (iii) of clause (ac) of sub-section (1) of section 12A or under clause (iii) of the first proviso to sub-section (5) of section 80G of the Act, till 30.06.2024.
It may be also noted that extension of due date as mentioned in paragraph 3(ii) shall also apply in case of all pending applications under clause (iii) of the first proviso to clause (23C) of section 10 or (iii) of clause (ac) of sub-section (1) of section 12A or under clause (iii) of the first proviso to sub-section (5) of section 80G of the Act, as the case may be. Hence, in cases where any trust, institution or fund has already made an application in Form No.10AB under the said provisions on or before the issuance of this Circular, and where the Principal Commissioner or Commissioner has not passed an order before the issuance of this Circular, the pending application in Form No.10AB may be treated as a valid application. 4.1 Further, in cases where any trust, institution or fund has already made an application in Form No. 10AB, and where the Principal Commissioner or Commissioner has passed an order rejecting such application, on or before the issuance of this Circular, solely on account of the fact that the application was furnished after the due date or that the application has been furnished under the wrong section code, it may furnish a fresh application in Form No. 10AB within the extended time provided in paragraph 3(ii) i.e. 30.06.2024.
5. It is also clarified that if any existing trust, institution or fund who had failed to file Form No.10A for A Y 2022-23 within the due date as extended by the CBDT circular no. 6/2023 dated 24.05.2023 and subsequently, applied for provisional registration as a new trust, institution or fund and has received Form No. 10AC, it can avail the option to surrender the said Form No. 10AC and apply for registration for A Y 2022-23 as an existing trust, institution or fund in Form No. 10A within the extended time provided in paragraph 3(i) i.e. 30.06.2024.