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Facts
The assessee, Mahatma Gandhi Sabarmati Ashram Memorial Trust, filed an appeal against the order of the CIT(E) rejecting their application for approval under Section 80G(5) of the Income Tax Act, 1961. The rejection was based on the ground that the application was not filed within the prescribed statutory time period. The assessee had received provisional approval earlier.
Held
The Tribunal referred to previous judgments in similar cases, including those of Bhurabhai Punjabhai Parsana Foundation and Navsari Agricultural University, where it was held that if the timeline for registration under Section 12A was extended, the timeline for filing applications under Section 80G(5) should also be considered extended. The Tribunal noted that the assessee had already been granted final registration under Section 12A.
Key Issues
Whether the application for approval under Section 80G(5) can be rejected solely on the ground of delay in filing, especially when similar timelines for other related sections were extended and the assessee had obtained final registration under Section 12A.
Sections Cited
80G(5), 12A, 10(23C)
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Income Tax Appellate Tribunal, “C” BENCH, AHMEDABAD
Before: DR.BRR KUMARSHRI TR SENTHIL KUMAR
O R D E R PER: DR. BRR KUMAR, VICE PRESIDENT: This appeal has been filed by the Assessee against the order passed by the Ld. Commissioner of Income Tax (Exemption), Ahmedabad vide order dated 21.03.2014. 2. The Assessee has taken the following grounds of appeal:-
The Ld. Commissioner of Income Tax (Exemption) has erred in law and on the facts of the case of the Appellant, in holding that the application under Clause (iii) of first proviso to sub-section (5) of Section 80G is non- maintainable on the only ground that the application is not filed within the statutory time period as in Clause (iii) of first proviso to Section 80G(5) of the I.T. Act, 1961.
The Ld. Commissioner of Income Tax (Exemption) has erred in law and on the facts of the case of the Appellant, in rejecting the application for Asst.Year NA - 2– approval under Clause (iii) of first proviso to sub-section (5) of Section 80G of the I.T. Act, 1961, without considering the same on merits. 3. The Ld. Commissioner of Income Tax (Exemption) has further erred in law and on facts of the case of the Appellant, by cancelling the provisional approval u/s.80G(5) already granted to the Appellant, without carrying out due procedure as prescribed under law and in absence of any dissatisfaction about genuineness of the activities of the appellant and also in absence of any violation of conditions prescribed u/s.80G(5) and also without affording opportunity of hearing to the Appellant for objecting to such cancellation. 4. The Ld. Commissioner of Income Tax (Exemption) has erred in law and on facts and circumstances of the case of the Appellant by rejecting the submissions made by the Appellant and also by misinterpreting the provisions of law with regard to the time limits for filing the application for approval as specified under clause (iii) of first proviso to sub-section (5) of the Section 80G of the I.T. Act, 1961. 5. The Ld. Commissioner of Income Tax (Exemption) has erred in law and on facts and circumstances of the case of the Appellant, by ignoring the fact that the Appellant has been granted final registration by order dated 22.03.2024 passed under Clause (ii) of second proviso of section 10(23C) for Asst. Years 2022-23 to 2026-27, wherein the similar time limits are applicable for filing of application by the Appellant. 6. The Appellant prays that the Ld. Commissioner of Income tax (Exemption) may kindly be directed to grant approval to the appellant. 7. The Appellant prays to reserve the right to add alter / amend and/or withdraw any of the above grounds of appeal.
3. The assessee has filed Form 10AB, u/s.80G(5) of the Act on 30/09/2023. The date of registration/incorporation in his case is 23.09.2019 as per Form No.10AB. The assessee had been granted order for provisional approval in Form No.10AC issued on 05.04.2022 under Clause(iv) of first proviso to sub-section(5) of section 80G for the period commencing from AY 2022-23. The Ld. CIT(E) rejected the application for approval citing the provisions of law with regard to the time limits for filing as specified under clause (iii) of first proviso to sub-section (5) of the Section 80G of the Asst.Year NA - 3– I.T. Act, 1961. Aggrieved by the order of the Ld. CIT(A), the Assessee filed appeal before the Tribunal. We have perused the facts on record and the provisions of the Act along with the judicial precedents on the issue.
The sequence of events in this case are as under : Sr.No. Facts Date Remarks 1. Incorporation of Trust 23.09.2021 2. Date of Commencement of Activity 17.08.2022 Received grant from GOI- 181 crores 3. Date of receipt provisional 05.04.2022 Valid upto AY 2024-25 registration u/s.10(23C)(iv) 4. Date of filing final application 30.09.2023 u/s.10(23C)(iv) 5. Date of receiving final approval 22.03.2024 u/s.10(23C)(iv) 6. Date of receipt provisional 05.04.2022 05.04.2022 upto AY registration u/s.80G(5) 2024-25 7. Date of filing final application 30.09.2023 u/s.80G(5) 8. Rejection of application filed 19.03.2024 u/s.80G(5) 5. We have gone through the Memorandum of Association of this Trust. The Governing Council consist of Hon’ble Chief Minister of Gujarat, Chief Secretary to Government of Gujarat, Secretary to Government of Tourism, Municipal Commissioner of Ahmedabad and Hon’ble Members of Parliament.
6. We find that the similar issue has been examined in detail by various orders of the Tribunal and Hon’ble High Courts which are as under: i. Chaloda Seva Samaj Trust Vs. CIT(E) in dated 18.12.2024 ii. Navsari Agricultural University Vs. CIT(Exemptions) 164 taxmann.com (Ahmedabad Trib.) iii. Adani Education Foundation Vs. CIT(Exemptions) 162 taxmann.com 40 (Ahmedabad-Trib) Asst.Year NA - 4– iv. Bhurabhai Punjabhai Parsana Foundation Vs. CIT(Exemption) 164 taxmann.com 749 (Ahmedabad Trib.) v. Shree Navsari Modh vanik Panch Vs. CIT (Exemptions) 159 taxmann.com 1249 (Surat Trib) vi. Grow Foundation Vs. CIT(Exemptions) 167 taxmann.com 12 (Ahmedabd Trib) vii. CIT Vs. Madras Medical Mission 145 taxmann.com 586 (Madras HC) viii. CIT(Exemptions) Vs. West Bengal Welfare Society of ITAT/77/2024- ITA No.GA/2/2024 dated 26.04.2024 (Calcutta High Court) ix. Sunil Tibrewall Foundation Vs. CIT(Exemptions) 161 taxmann.com 39 (Mum Trib) x. Sewa Bharti Vs. CIT(Exemption) 166 taxmann.com 39 (Kol Trib) xi. Bhamashah Sundarlal Daga Charitable Trust Vs. CIT(Exemptions) 158 taxmann.com 712 (jodh Trib) xii. Mallarpur Naisuva Vs. CIT(Exemptions) 162 taxmann.com 120 (Kol Trib) xiii. North Eastern Social Research Centre Vs. CIT(E) 165 taxmann.com 12 (kol. Trib) xiv. Anudip Foundation for social welfare Vs. CIT(E) 160 taxmann.com (Kol.Trib)
For the sake of ready reference, the ratio of the orders in the case of Chaloda Seva Samaj Trust Vs. CIT(E) in dated 18.12.2024, wherein one of the Member of the Bench is the signatory is examined alongwith the orders in the case of Navsari Agricultural University Vs. CIT(Exemptions) 164 taxmann.com and Bhurabhai Punjabhai Parsana Foundation Vs. CIT(Exemption) 164 taxmann.com 749. The relevant portion of the ITAT order in the case Chaloda Seva Samaj Trust Vs. CIT(E) in ITA No.1043/Ahd/2024 dated 18.12.2024, is reproduced as under: Asst.Year NA - 5– “…4. We have heard rival submissions and perused the materials available on record. The Co-ordinate Bench of this Tribunal in similar case of delay in filing the application for Final Registration u/s. 80G(5) of the Act in the case of Bhurabhai Punjabhai Parsana Foundation Vs. CIT(E) reported in (2024) 164 taxmann.com 749 remanded the matter back to the file of Ld. CIT(E) for de novo consideration by observing as follows: “Section 80G of the Income-tax Act, 1961 - Deductions - Donation to certain funds, charitable institutions (Approval under sub-section (5)) - Assessment year 2023-24-Assessee-trust had earlier been granted provisional approval in Form No. 10AC under clause (iv) of first proviso to section 80G(5) on 24-9-2021-It filed application for grant of final approval under clause (iii) of first proviso to section 80G(5) in Form No. 10AB on 2-8-2023 Commissioner Exemption) having found that date of commencement of activities of trust was 11-11-2021 observed that assessee was required to file application for final approval on or before 30- 9- 2022 and rejected application as not maintainable Whether on a reasonable interpretation, assessee could have filed application for grant of final approval under clause (iii) of first proviso to section 80G(5) upto 30- 9-2023 in view of extention granted to registration of trust Lunder section 12A till 30-9-2023 Held, yes Whether thus application for grant of final approval could not have been rejected only on ground that same was not filed on or before 30-9-2022-Held, yes [Paras 10 and 13] [Matter remanded]” 4.1. Similarly in the case of Navsari Agricultural University Vs. CIT(E) reported in (2024) 164 taxman.com 256 the Co-ordinate Bench held as follows: “Section 80G of the Income-tax Act, 1961-Deductions - Donation to certain funds, charitable institutions (Approval) Whether once timeline prescribed for filing Form No. 10A for recognition under section 12A had been extended up to 30-9-2023, same may be treated as extended for forms namely Form No. 10AB for renewal of approval/recognition/registration under clause (iii) of first proviso to section 80G also - Held, yes Assessee trust was an old Trust which was registered on 6-3-2004-It was granted provisional approval under section 80G(5) on 26-10-2022 and filed application for grant of final approval under section 80G(5) on 28-3-2023 Commissioner (Exemption) held that benefit of circular No. 6/2023 dated 24-5- 2023 of CBDT for filing belated application under clause (i) of first proviso to section 80G(5) was available till 30-9-2022 only and since Asst.Year NA - 6– assessee did not file application under section 80G(5) within time limit, application was to be rejected - Whether since assessee trust had filed application for grant of final approval under section 80G(5) within a period of six months from date of grant of provisional registration and it could have filed application for grant of registration under section 80G(5) in Form 10AB up to 30-9-2023 in view of extension granted to registration of trust under section 12A till 30-9-2023, application for grant of final registration under section 80G(5) could not be denied only on ground that same was not filed before 30-9-2022-Held, yes [Para 13] [In favour of assessee]”
Further in the present case, Final Registration u/s. 12A is already granted by the Ld. CIT(E) to the assessee Trust. Therefore, we deem it fit to set aside the matter back to the file of Ld. CIT(E) to grant Final Registration u/s. 80G(5) of the Act.
In the result, the appeal filed by the Assessee is allowed for statistical purpose…”
Keeping in view the parity of the factual matrix and in the absence of any change in legal proposition, we deem it fit to set-aside the matter back to the file of Ld.CIT(E) with directions to grant final registration u/s.80G(5) of the Act.
In the result, the appeal of the assessee is allowed for statistical purposes.