IWA INDIA FOUNDATION,KOLLAM vs. CIT EXEMPTION, KOCHI

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ITA 759/COCH/2025Status: DisposedITAT Cochin28 November 2025AY 2025-265 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that the CIT(E) rejected the assessee's application solely on the procedural ground of delay without examining the reasons furnished and without evaluating the merits of the assessee's charitable activities. The medical records clearly demonstrated that the assessee's key functionary suffered from a serious illness requiring prolonged medical care, which restricted his ability to attend to statutory obligations. The Tribunal found that such circumstances constitute a reasonable cause, as recognized in judicial precedents like Collector, Land Acquisition v. Mst. Katiji (SC) and N. Balakrishnan v. M. Krishnamurthy (SC). The CIT(E) was vested with discretion under Section 119(2)(b) read with Section 12A/12AB to condone delay where genuine and bona fide reasons existed. The Tribunal found the CIT(E)'s order unsustainable due to the disregard of medical evidence and its non-speaking nature. The matter was remanded to the CIT(E) with a direction to consider the condonation request afresh, taking into account the medical exigencies supported by evidence, and then adjudicate the Form 10AB application on merits.

What were the facts?

The assessee, IWA India Foundation, is an organization that was granted provisional registration under Section 12A of the Income Tax Act, 1961, on 30.10.2023. As per the rules, it was required to file Form 10AB within six months of commencing activities or before the expiry of provisional registration (30.06.2024), whichever was earlier. The assessee filed Form 10AB on 01.01.2025, approximately six months late. The delay was attributed to the severe and sudden illness of its Director, Mujeeb Rehman, who was responsible for statutory compliance. The Commissioner of Income Tax (Exemption) [CIT(E)] rejected the application solely on the technical ground of delay, stating that no valid reasons were provided. The assessee appealed this order.

What were the issues?

1. Whether the delay in filing Form 10AB was caused by unavoidable medical exigencies, constituting a reasonable cause for condonation under the Income Tax Act, 1961. 2. Whether the CIT(E) failed to appreciate the bona fides and merits of the assessee's charitable activities when rejecting the application. 3. Whether the CIT(E) failed to exercise statutory discretion vested under Section 119(2)(b) read with Section 12A/12AB to condone the delay. Assessee's Contentions: The delay was neither deliberate nor intentional but was caused by medical emergencies, which are recognized as reasonable cause under the Act and judicial precedents. The CIT(E) did not appreciate the bona fides of the charitable activities and did not exercise its statutory discretion to condone the delay. Revenue's Contentions: The Departmental Representative supported the order of the CIT(E).

Which sections of the Income-tax Act were involved?

Section 12A,Section 12AB,Section 119(2)(b)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, COCHIN

Before: HON’BLE SHRI INTURI RAMA RAO & SHRI HON’BLE MANU KUMAR GIRI

Year: 2025-26 IWA India Foundation, The Commissioner of Income Tax IWA Coaching Centre, Vs. (Exemptions), Near Chinnakada Juma Masjid, Kollam. Kollam – 691 001. PAN AAGCI 4575F (अपीलाथ�/Appellant) (��यथ�/Respondent) अपीलाथ� क� ओर से/ Appellant by : Shri Ajmar Mujahir, C.A ��यथ� क� ओर से /Respondent by : Shri Sanjit Kumar Das, CIT-DR सुनवाई क� तार�ख/Date of Hearing : 06.11.2025 घोषणा क� तार�ख /Date of Pronouncement : 28.11.2025 आदेश / O R D E R PER MANU KUMAR GIRI (Judicial Member):

This appeal by the assessee is directed against the order of the Commissioner of Income Tax (Exemption), KOCHI [hereinafter “CIT(E)”], dated 29.09.2025, rejecting the assessee’s application in Form 10AB filed on 01.01.2025 for regularisation of provisional registration under Section 12A of the Income Tax Act, 1961.

:- 2 -:

2.

Facts in brief are that the assessee is a charitable organisation registered under the Societies Registration Act and was granted provisional registration u/s 12A vide Form 10AC dated 30.10.2023. Under the statutory provisions, the assessee was required to file Form 10AB within six months of commencement of charitable activities or before expiry of provisional registration (30.06.2024), whichever was earlier.

3.

The assessee filed Form 10AB on 01.01.2025, delayed by approximately six months. During the proceedings before the CIT(E), the assessee submitted a reasoned request for condonation of delay, supported by medical documents, explaining that the delay occurred due to the severe and sudden illness of the Director, Mujeeb Rehman, who was responsible for statutory compliance. The medical condition and hospitalization rendered him incapable of attending to the preparation and filing of Form 10AB on time.

4.

The CIT(E), however, rejected the application solely on the technical ground of delay, with the finding that the assessee had “failed to provide any valid or genuine reasons for the delay.”

:- 3 -:

5.

The assessee has raised multiple grounds, all of which challenge the rejection of Form 10AB on the basis that:

(a) the delay was caused due to unavoidable medical exigencies, (b) the CIT(E) failed to appreciate the bona fides and merits of the charitable activities, and (c) the CIT(E) did not exercise statutory discretion to condone delay.

6.

The learned counsel for the assessee reiterated that the delay was neither deliberate nor intentional, but caused due to medical emergencies, which are well-recognized as “reasonable cause” under the Act and judicial precedents.

7 The Departmental Representative supported the order of the CIT(E).

8.

We have carefully considered the submissions and perused the material on record. The CIT(E) has rejected the assessee’s application only on the procedural ground of delay without examining the reasons furnished and without evaluating the merits of the assessee’s charitable activities. The medical records placed before us clearly demonstrate that the assessee’s key functionary suffered from serious

:- 4 -: illness, requiring prolonged medical care and restricting his ability to attend to statutory obligations. Such circumstances constitute a reasonable cause, as recognised in judicial precedents including Collector, Land Acquisition v. Mst. Katiji (SC) and N. Balakrishnan v. M.

Krishnamurthy (SC).

9.

The CIT(E) was vested with discretion u/s 119(2)(b) read with Section 12A/12AB to condone delay where genuine and bona fide reasons existed. The complete disregard of medical evidence and non-speaking nature of the order renders it unsustainable in law. This is a fit case where the matter should be remanded to the CIT(E), with a direction to consider the condonation request afresh and then examine the merits of registration.

10.

In view of the above observations, the impugned order of the CIT(E) dated 29.09.2025 is hereby set aside and the matter is restored to the file of the CIT(E) with a directions that the CIT(E) shall consider the assessee’s application for condonation of delay afresh, taking into account the medical exigencies supported by evidence. The CIT(E) shall then adjudicate the assessee’s Form 10AB application on merits, in :- 5 -: accordance with law. Needless to say, the assessee shall be granted adequate opportunity of being heard.

11.

In the result, appeal filed by the assessee is allowed for statistical purpose.

Order pronounced on 28th day of November, 2025 at Cochin.

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