SHRI GUJARAT KADAVA PATIDAR JAN KALYAN TRUST,MEHSANA GUJARAT vs. THE CIT(EXEMPTION), AHMEDABAD

Shri Sunil Talati, the ld. counsel for the assessee submitted that the ld. CIT(E) had rejected the application filed by the assessee for the reason that the assessee Trust was not found eligible for registration under section 12A(1)(ac)(vi) of the Act. The Ld. AR explained that the activity of the trust had commenced on 01.04.2022. While filing the application in Form 10AC, there was an inadvertent error as incorrect section code - item (B) of sub clause (vi) of clause (ac) of sub-section (1) of section 12A of the Act was selected in place of the correct code, which was sub clause (iii) of clause (ac) of sub-section (1) of section 12A of the 2 A.Y. NA Shri Gujarat Kadva Patidar Jankalyan Trust vs. CIT (Exemption) Act. He explained that this mistake had occurred for the reason that the assessee was operating from a remote location and there was no proper professional guidance available. The Ld. AR submitted that the assessee may be allowed an opportunity to rectify the mistake in the application and the matter may be set aside to the file of Ld. CIT(E) with a direction to re-adjudicate the issue.

Per contra, Shri Alpesh Parmar, the ld. CIT-D.R. submitted that the Ld. CIT(E) had rightly rejected the application as filed by the assessee.

We have considered the submission of the assessee and perused the materials placed before us. The Ld. CIT(E) had rightly rejected the application filed by the assessee Trust u/s 12A(1)(ac)(vi) of the Act, as the conditions for such approval was not found satisfied. In fact, the Ld. CIT(E) had made certain queries in the course of the proceeding before him, which was responded by the assessee. However, the fact that there was a mistake in the application of the assessee was not brought to the notice of Ld. CIT(E). The assessee has now submitted that there was a mistake in the application in quoting the section code under which the approval was sought. According to the assessee, the section code “Item (B) of sub-section (vi) of clause (ac) of sub- section (1) of section 12A” was wrongly quoted in the application in place of correct section code “sub-section (iii) of clause (ac) of sub-section (1) of section 12A” of the Act. A copy of order dated 23.09.2021 of the provisional registration allowed to the assessee A.Y. NA Shri Gujarat Kadva Patidar Jankalyan Trust vs. CIT (Exemption) has been brought on record. It is found there from that the assessee was allowed provisional registration under sub- section (vi) of clause (ac) of sub-section (1) of section 12A for the AY 2022-23 to AY 2024-25. When the provisional registration was allowed under sub-section (vi) of clause (ac) of sub-section (1) of section 12A of the Act, the assessee had rightly applied for regular registration under this provision only. The mistake on the part of the assessee, if any, had occurred in the application for provisional registration and not in the application for regular registration.

The contention of the assessee is that there was a mistake in wrong selection of section code in the application. We don’t find any such mistake in the regular registration application. Rather, the mistake was made at the time of filing the application for provisional registration. The moot issue to be considered here is, if the provisional registration was allowed under one sub-clause, whether the assessee could have made application for final registration under different sub-clause. For this purpose, we deem it proper to set aside the matter to the file of Ld. CIT(E) with a direction to first examine this issue and thereafter allow an opportunity to the assessee to rectify the application, if permissible as per the provisions of law. The assessee may also be allowed a proper opportunity of being heard in the matter. The assessee will also be free to make a fresh application under the correct provisions of the Act, if it so desires.