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Facts
The assessee's appeal was filed 78 days late due to an inadvertent error in selecting the wrong clause while applying for approval under Section 80G of the Act, compounded by technical glitches on the income tax portal. The CIT(E) rejected the application solely on this technical ground, deeming the application not maintainable.
Held
The Tribunal condoned the delay in filing the appeal. Citing various judicial precedents, the Tribunal held that rejection on technical grounds without addressing the merits, especially when an inadvertent error or system glitch is involved, violates principles of natural justice.
Key Issues
Whether the appeal filed after a significant delay due to an inadvertent error should be condoned, and whether the CIT(E) correctly rejected the application for approval under Section 80G on technical grounds without considering the merits.
Sections Cited
80G, 10AC, 10AB, 12AB
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Income Tax Appellate Tribunal, “D” BENCH, AHMEDABAD
Before: SMT. ANNAPURNA GUPTA & SHRI SIDDHARTHA NAUTIYAL
O R D E R
PER SIDDHARTHA NAUTIYAL - JUDICIAL MEMBER:
This appeal has been filed by the Assessee against the order passed by the Ld. Commissioner of Income Tax (Exemption), (in short “Ld. CIT(E)”), Ahmedabad vide order dated 18.10.2024.
At the outset, we observe that the appeal is time barred by 78 days. The assessee filed an Affidavit for condonation of delay vide Affidavit dated 12.05.2025, wherein the assessee stated that the case of the assessee was pursued by his Chartered Accountant but the assessee was not informed about the appellate order which was passed on 18.10.2024. After that the assessee handed over all details and documents to another consultant and after verifying those documents and analyzing the Income Tax Portal of the Trust, the assessee found the order passed by Ld. CIT(E). After consulting with consultant and consent of all trustees, the assessee trust had decided to prefer an appeal before the Tribunal. It was as a result of aforesaid reasons that there was a delay of 78 days in filing of the Youth Service Centre vs. CIT(E) Asst.Year –N.A. - 2– present appeal. The Counsel for the assessee submitted that there was no mala fide intention in delay in the filing of the appeal and hence the same may be kindly condoned.
Looking into the instant facts and the reasons cited by the assessee for the delay of 78 days in the filing of the present appeal, in the interest of justice, the delay in filing of the present appeal is hereby condoned.
The Assessee has taken the following grounds of appeal:-
1.01 On the facts and circumstances of your appellant’s case and in law, the ld. CIT(E) erred in rejecting application filed for renewal of provisional approval granted under clause (iv) of first proviso to Sub-Section (5) of Section 80G of the Act on plea that your appellant has filed application selecting different clause and as such not maintainable. 1.02 Your appellant submits that due to technical glitches, the income tax portal was not allowing to select clause (ii), as against filed selecting clause (iii), while filing application which the ld. CIT(E) failed to consider. 1.03 Your appellant prays Your Honour to hold so now and direct the ld. CIT(E) to consider the application filed by your appellant as if it is filed selecting correct clause since your appellant is deprived off of the benefit of accepting donations in absence of approval. Your appellant craves leave to add, alter and / or amend the grounds herein above raised.
5. The brief facts of the case are that application filed by the applicant trust was rejected by Ld. CIT(E), Ahmedabad on the ground that since the assessee / applicant trust was not holding any valid / regular approval either in Form 10AC or Form 10AB. The applicant / assessee trust was supposed to file application for grant of approval under Section 80G of the Act under Clause (iii) of First Proviso to sub-Section (5) of Section 80G of the Act, whereas the assessee had incorrectly filed applicant in Clause (ii) of First Proviso to sub-Section (5) of Section 80G of the Act.
Youth Service Centre vs. CIT(E) Asst.Year –N.A. - 3– 6. Before us, the Counsel for the assessee admitted that there was in fact an inadvertent error on part of the assessee in filing application under Section 80G of the Act. However, this was due to a system error in the online filing portal, which prevented the assessee / applicant trust to file the application for grant of approval under the correst sub-clause of Section 80G of the Act. However, despite this, Ld. CIT(E) rejected the application for grant of approval under Section 80G of the Act only on the ground that Ld. CIT(E) has no power to amend the “Section Code” opted by the applicant trust while filing Form 10AB. The Counsel for the assessee submitted that this error occurred on account of defect / system error in the online portal and for which the assessee could not be penalized.
In response, Ld. D.R. placed reliance on the observations made by the Ld. CIT(E) in his order denying grant of registration under Section 80G of the Act.
We have heard the rival contentions and perused the material on record.
In the case of Global Academy for Medical Education & Science Trust vs. CIT(E) 162 taxmann.com 69 (Ahmedabad – Tribunal), the Ahmedabad Tribunal held that where CIT(E) by ex-parte order rejected the assessee trust’s applications for grant of registration under Section 12AB and under Section 80G of the Act, in view of the principles of natural justice, said authority was directed to re-consider grant of registration under Section 12AB and under Section 80G of the Act, by providing one more opportunity to the assessee to pass appropriate orders.
In the case of Bhagwan Mahaveer Jain Relief Trust vs. CIT(E) 171 taxmann.com 574 (Raipur – Tribunal), the Raipur Tribunal held Youth Service Centre vs. CIT(E) Asst.Year –N.A. - 4– that where CIT(E) rejected assessee trust’s application for registration under Section 80G of the Act on the technical ground that the application was not filed under the correct provisions, since there was no mention of any specific query or show-cause to the assessee about ineligibility to file an application under the provisions of Clause (iv)(b) of the First Proviso to Section 80G(5) of the Act in the impugned order, principles of natural justice had been violated by rejecting the application, without confronting the assessee about reasons for such rejection and thus, the matter was required to be remanded back.
In the case of Subharma Charitable Trust vs. CIT(E) 172 taxmann.com 431 (Mumbai – Tribunal), the ITAT Mumbai held that where assessee trust, provisionally approved under Section 80G of the Act, filed an application for approval under Clause (ii) of First Proviso to Section 80G(5) instead of Clause (iii), since error committed was merely inadvertent and clerical matter was to be remanded to Commissioner (Exemption) to grant an opportunity to assessee to file revised application under Clause (iii) of First Proviso to Section 80G(5) of the Act.
In the case of Rotary Charity Trust vs. CIT(E) 170 taxmann.com 797 (Mumbai – Tribunal), the ITAT Mumbai Bench held that where assessee trust filed an application for final registration under Section 80G(5) of the Act and Commissioner (Exemption) rejected said application on ground that assessee was not fulfilling stipulated conditions prescribed for filing application for approval in Form 10AB, since assessee had inadvertently mentioned wrong section, issue was to be remitted back to file of Commissioner (Exemption), with a direction to grant final approval to assessee under Clause (iii) to First Proviso to Section 80G(5) of the Act, if assessee was otherwise found eligible.
Youth Service Centre vs. CIT(E) Asst.Year –N.A. - 5–
Accordingly, in light of the assessee’s set of facts and in view of the judicial precedents referred to above, in the interet of justice, the matter is restored to the file of Ld. CIT(E) for de-novo consideration.
In the result, the appeal of the assessee is allowed for statistical purposes. This Order pronounced in Open Court on 20/06/2025
Sd/- Sd/- (ANNAPURNA GUPTA) (SIDDHARTHA NAUTIYAL) ACCOUNTANT MEMBER JUDICIAL MEMBER Ahmedabad; Dated 20/06/2025 TANMAY, Sr. PS TRUE COPY आदेश की �ितिलिप अ�ेिषत/Copy of the Order forwarded to : 1. अपीलाथ� / The Appellant 2. ��थ� / The Respondent. 3. संबंिधत आयकर आयु� / Concerned CIT 4. आयकर आयु�(अपील) / The CIT(A)- 5. िवभागीय �ितिनिध, आयकर अपीलीय अिधकरण, अहमदाबाद / DR, ITAT, Ahmedabad 6. गाड� फाईल / Guard file. आदेशानुसार/ BY ORDER,