Loading judgment…
Facts
The assessee society applied for registration under Section 12AB of the Income-tax Act, 1961. The application was rejected by the CIT(Exemption) for non-compliance with notices and non-registration under the Rajasthan Public Trust Act, 1959. The society sought condonation of a 524-day delay in filing the appeal, citing the prolonged illness of its elderly President.
Held
The Tribunal held that the delay was caused by sufficient cause, considering the advanced age and illness of the President, and that it was neither intentional nor deliberate. The Tribunal also ruled that registration under the Rajasthan Public Trust Act is not a mandatory requirement for registration under Section 12AB of the Income-tax Act.
Key Issues
Whether the delay in filing the appeal is to be condoned due to sufficient cause, and whether non-registration under the Rajasthan Public Trust Act is a bar to obtaining registration under Section 12AB of the Income-tax Act.
Sections Cited
12AB, 10AD, 12A, 12A(1)(ac)(vi), 10AC, 10AB
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, JAIPUR BENCH “A”, JAIPUR
Before: SHRI GAGAN GOYAL & SHRI NARINDER KUMAR
In the matter of condonation of delay in filing appeal 1. The present application has been moved by the assessee society, Saraswati Shiksha Society, seeking condonation of delay of 524 days in filing the appeal against the impugned order dated 20/09/2023 passed in Form No. 10AD rejecting the application of the assessee for registration under section 12AB of the Income-tax Act, 1961.
2. The facts, as brought on record, reveal that the assessee society was originally registered with the Registrar of Societies, Rajasthan, Jaipur, on 24/05/1979 vide Registration Certificate No. 80/1979-80. The society was granted provisional registration under section 12A (1) (ac) (vi) of the Act vide order in Form 10AC dated 27/05/2021. Thereafter, an application for regular registration under section 12AB was filed in Form No. 10AB on 31/03/2023, under Acknowledgement No. 104532340310323.
3. It is the case of the assessee society that notices/letters referred to in the impugned order were allegedly issued to its e-mail address, but the same were never received by the society. Consequently, the application came to be rejected by the authority on 20/09/2023 in Form No. 10AD, which further led to the denial of exemption.
4. The delay in filing the appeal has been explained on the ground that the President of the assessee society, Shri Hari Dutt Sharma, aged about 85 years and a retired government servant, who has been managing the society for many years, was suffering from prolonged illness and could not attend to the affairs of the society. It was only on resumption of his duties on 16/04/2025, after recovery from illness, that he discovered the rejection order, immediately thereafter steps were taken to file the present appeal.
5. It is a well-settled principle of law that while considering applications for condonation of delay, a liberal and justice-oriented approach has to be adopted, particularly where the appellant has demonstrated sufficient cause which prevented it from filing the appeal within the prescribed limitation. The activities of the society are directly linked to imparting education to students, many of whom come from modest backgrounds and rely upon the continued functioning and recognition of the institution for pursuing their studies. In such circumstances, the consequences of non-condonation of delay will not be confined merely to the society as a legal entity but will extend to a much larger class of innocent students whose educational prospects would be adversely affected. It would be wholly unjust to allow a technical default or delay in filing the appeal to overshadow the larger public interest involved in the matter. Education is the very foundation of social and economic development and denying the society an opportunity to be heard on merits would amount to indirectly playing with the rights and future of the students enrolled with the institution. Therefore, in cases involving educational or charitable organizations, courts and authorities are expected to adopt a pragmatic and liberal approach, ensuring that substantive justice is advanced and technicalities do not stand in the way of larger public good.
6. Considering the facts and circumstances, the advanced age and illness of the President of the society, and the fact that the delay is neither intentional nor deliberate but owing to reasons beyond the control of the appellant, this forum is satisfied that ‘sufficient cause’ has been shown for the delay of 524 days in filing the appeal.
Accordingly, in exercise of the powers vested, the delay of 524 days in filing the present appeal is hereby condoned. The appeal is admitted for adjudication on merits.
The assessee, a registered society, was granted provisional registration under section 12A vide order in Form No. 10AC dated 27/05/2021. Thereafter, in accordance with section 12A (1) (ac) (iii) of the Act, it filed an application for regular registration under section 12AB in Form No. 10AB on 31/03/2023, duly acknowledged under No. 104532340310323.
The Ld. CIT (Exemption), however, rejected the said application vide order in Form No. 10AD on the grounds of non-registration of the assessee under the Rajasthan Public Trust Act, 1959 as well as alleged non-compliance of notices/letters issued from his office. Aggrieved by the order of the Ld. CIT (Exemption) assessee is inappeal before us. We have heard the rival contentions and perused the material available on record
It is the contention of the assessee that no such notices were ever received by it. The record reveals that the society has been managed for several years by its President, Shri Hari Dutt Sharma, aged about 85 years and a retired Government servant, who was suffering from prolonged illness during the relevant period. It is explained that owing to such circumstances, he could not effectively attend to the affairs of the society, which resulted in certain lapses in compliances. On these facts, it is clear that the assessee was not afforded an effective opportunity of being heard specifically in the context of this assessee as the man at the helm of affairs is in the super senior citizen category and was not well to participate/check the e-mail communications, before rejection of its application. Thus, the order suffers from violation of the principles of natural justice in specific set of facts.
As regards the objection of the Ld. CIT (Exemption) relating to non- registration under the Rajasthan Public Trust Act, 1959, the coordinate Bench of this Tribunal in the case of APJ Abdul Kalam Education and Welfare Trust v. CIT (Exemption) [2025] 171 taxmann.com 569 (Jaipur – Trib.) has held that registration under the RPT Act, 1959 is not a mandatory requirement for seeking registration under section 12AB of the Act. It has been observed therein that both statutes operate in their own fields, and absence of registration under the RPT Act cannot be a ground to deny registration under the Income-tax Act. Following the said decision, we hold that the objection of the Ld. CIT (Exemption) is without merit.
In view of the foregoing, we are of the considered opinion that the impugned order passed by the Ld. CIT (Exemption) is set aside, and the matter is restored to the file of the Ld. CIT (Exemption) with a direction to consider the assessee’s application for registration under section 12AB afresh on merits, after providing due and reasonable opportunity of being heard. Needless to say, that the requirement of RPT Act is not required to be fulfilled and to be verified also for the purposes of registration u/s. 12A of the Act.
In the result, the appeal of the assessee is disposed of for statistical purpose The Order is pronounced in the open court on the 15th day of September 2025.