SHUKOOR HABIB TRUST,CHENNAI vs. COMMISSIONER OF INCOME TAX(EXCEMPTIONS), CHENNAI

This appeal by the assessee is arising out of the order of CIT (Exemption), Chennai vide order no. ITBA/EXM/S/EXM1/2020- 21/1031568685(1) dated 17.03.2021 passed u/s. 12AA(1)(b)(ii) of the Income-tax Act, 1961 (herein after referred to as “the Act”).

The CIT(E) erred in holding that he does not have power to condone the delay in filing an application made u/s. 12A(1)(ab) of the Income Tax Act. 1961.

For these and such other grounds that may be permitted to be raised during the hearing of the appeal.”

The brief facts of the case are that the assessee is a trust registered u/s. 12AA(a) of the Act vide registration no. C.No: 212(1276)/75 dated 08.05.1975. Subsequently, the assessee modified its objects by way of registering the supplementary trust deed dated 16.09.2019. In respect of modification of objects, the assessee file an application in Form 10A on 19.10.2019 for incorporating the modifications in the objects of the trust deed as required u/s. 12A(1)(ab) of the Act. Ld. CIT(E) noted that the assessee is required to filed the application in Form 10A within 30 days from the date of modification of the objects of the trust. The assessee has filed its application on 19.10.2019 which is delayed by 3 days. A show cause notice was issued by the Ld. CIT(E) to explain the reason for the delay. The assessee filed its reply on 24.01.2021, wherein it was submitted that the delay was attributable to the operational difficulties as the sole trustee Shri. A. Shafeeq Ahamed died unexpectedly on 26.06.2019. The assessee relied upon certain judicial precedence in the case of (i) CIT vs Indian Gospel Fellowship Trust (Hon’ble High Court of Madras) (ii) Gayatri Charitable Trust vs CIT-II, Baroda (Hon’ble ITAT Ahmedabad). Ld. CIT(E) rejected the application of the assessee by holding that Form 10A has not been filed within the limitation of 30 days from the date of modification of its object as required u/s. 12A(1)(ab) of the Act. Aggrieved, the assessee is in appeal before this Tribunal.

Ld. Counsel of the assessee Mr. K. Ravi, Advocate represented the assessee and Mr. AR V Sreenivasan, Addl. CIT represented the Department.

Ld. Counsel of the assessee submitted that there is an inherent power with the ld. CIT(E) available u/s. 12A(1)(ab) of the Act to condone the delay where a reasonable cause exists which is beyond the control of the assessee. In the present case, the delay is of brief period of 3 days that is attributable to the operational difficulties which arose because of unexpected death of the sole trustee of the assessee. He submitted that the brief delay of 3 days ought to be condoned and the matter may be set aside to the file of the Ld. CIT(E) for reconsideration of the application made in Form 10A already on record. Ld. Sr. DR objected and submitted that the delay ought not to be condoned.

We have heard the rival contentions, perused the material on record and given a thoughtful consideration to the reasonable cause that exists in respect of brief delay of 3 days based on which the application made by the assessee in Form 10A has been rejected by the Ld. CIT(E). In the interests of justice, fair play and good conscience, we find it proper to remit the matter back to the file of the 5 Shukoor Habib Trust, Ld. CIT(E) to reconsider the application made by the assessee in Form 10A in respect of modifications made in the objects of the trust deed of the assessee and dispose off the matter meritoriously. Needless to say, the assessee be given reasonable opportunity of being heard. Accordingly, the appeal of the assessee is allowed for statistical purposes.

In the result, the appeal of the assessee is allowed for statistical purposes.