Loading judgment…
Facts
The assessee, Tirth Global Foundation, filed applications for approval under Section 12AB and 80G of the Income-tax Act, 1961. The applications were rejected by the CIT(E) primarily on the grounds of delay in filing and procedural irregularities.
Held
The Tribunal condoned the delay in filing the appeals, acknowledging that the assessee's delay was due to a bonafide belief and lack of awareness of new provisions. The matter was remanded back to the CIT(E) for fresh consideration, allowing the assessee to present their case for condonation of delay.
Key Issues
Whether the delay in filing the application for registration under Section 12AB and 80G was intentional and whether the CIT(E) erred in rejecting the applications on procedural grounds.
Sections Cited
12A, 12AB, 80G
AI-generated summary — verify with the full judgment below
Detected automatically from the text. The count shows how many other judgments on BharatTax rely on the same authority.
Before: SHRI ANIKESH BANERJEE & SHRI PRABHASH SHANKAR&
Date of Hearing 05.01.2026 Date of Pronouncement 02.02.2026 आदेश / O R D E R PER PRABHASH SHANKAR [A.M.] :- The above captioned appeals have been filed by the assessee Trust against the orders passed by the Learned Commissioner of Income- tax(Exemptions), Mumbai [hereinafter referred to as “CIT(E)”] u/s. section 12AB and 80G of the Income-tax Act, 1961 [hereinafter referred to as “Act”].Since the issues are inter-connected and also the fact that appeals
P a g e | A.Y. 2025-26 to 2029-30 Tirth Global Foundation, Mumbai were heard together, they are being taken up together for adjudication vide this composite order for the sake of brevity.
2. The grounds of appeal 1) The Ld. Commissioner of Income Tax (Exemption) [CIT(E)] erred in rejecting the application for approval u/s 12AB of the Act dated 30.11.2024 on the grounds that it was filed beyond September 2023 ie beyond 6 months from commencement of activities of the Trust. 2) The Ld. CIT(E) erred in not appreciating the fact that: The assessee had already obtained provisional approval dated 28.05.2021 which was valid upto Assessment Year 2024-25. The assessee had commenced activities on 01.04.2020 which was prior to the date of provisional approval ie 28.05.2021. Thus, the six month time limit from date of commencement of activities does not apply to the assessee. The Trustees were not aware that such provisional registration expired after 3 years on 31.03.2024. They were impression that the registration was for 5 to 10 years. The provisional registration scheme was introduced for the first time from 01.04.2021 (by Finance Act 2020). Thus, this was a new scheme under which the Trust applied for registration for the first time. Further, this was the first time that the Trustees were applying for renewal of registration. The Trust is satisfying all other legal compliances and is filing Form 10BB every year.
3. At the outset, it was noticed that both the above appeals are delayed by 78 days. In this regard, the assessee has filed a condonation application alongwith an affidavit of the Trustee stating that assessee Trust had obtained Provisional Registration in Form 10AC dated 28.05.2021 applicable year for a period of 3 years ie AY 2022-23 to 2024-25. The Trust was to apply for a fresh registration certificate u/s P a g e | A.Y. 2025-26 to 2029-30 Tirth Global Foundation, Mumbai 12A of the Act for AY 2025-26 onwards. The CIT(E) passed order u/s 12A of the Act dated 26.06.2025. Thus, the due date to file the appeal before the ITAT was 25.08.2025.The reason for rejection was that the application for approval u/s 12A of the Act was filed late. The assessee was of the view that it could reapply u/s 12A of the Act. Hence, it did not file further appeal to against the rejection order. This was the first time that the Trust was applying for renewal of Section 12A certificate. The Trust was not aware that such rejection of section 12A approval could be challenged before the ITAT. It was later advised by its Chartered Accountant that the trust should challenge the rejection order before ITAT. Due to the above reason, appeal was delayed. It is submitted that the delay is not intentional. The assessee being layman was not aware of the technical provisions of the Act. The delay was was not malafide and therefore,it may be condoned. Refusing to condone delay can result in meritorious matter being thrown out at the very threshold and cause justice to be defeated.
4. On careful consideration of the submissions of the assessee, we are of the considered opinion that the delay in filing of the present appeal was not intentional but due to lack of awareness of the new provisions for registration of Trust. Such a bonafide mistake needs to considered libarally. In this connection, reliance could be placed on the P a g e | A.Y. 2025-26 to 2029-30 Tirth Global Foundation, Mumbai landmark decision of hon’ble Supreme Court which inter alia held in Collector, Land Acquisition v Mst. Katiji And Others- 167 ITR 471 (SC) that “ordinarily, a litigant does not stand to benefit by lodging an appeal late……..Refusing to condone delay can result in a meritorious matter being thrown out at the very threshold and cause of justice being defeated….Any appeal or any application, other than an application under any of the provisions of Order XXI of the Code of Civil Procedure, 1908, may be admitted after the prescribed period if the appellant or the applicant satisfies the court that he had sufficient cause for not preferring the appeal or making the application within such period…. A litigant does not stand to benefit by resorting to delay. In fact, he runs serious risk.” We therefore, condone the delay setting aside the appellate order and proceed to adjudicate the grounds on merit.
According to the order, the trust filed an application in Form 10AB u/s 12A(1)(ac)(iii) seeking registration under section 12AB of the Act. Various details were called for by the ld.CIT. After a careful perusal of the submission, it was noticed by him that the trust had obtained provisional registration in Form 10AC dated 28.05.2021 valid from AY 2022-23 to AY 2024-25. As per section 12A(1)(ac)(iii) of the Act where
P a g e | A.Y. 2025-26 to 2029-30 Tirth Global Foundation, Mumbai the trust or institution has been provisionally registered under section 12AB, at least six months prior to expiry of period of the provisional registration or within six months of commencement of its activities, whichever is earlier. Thus, as per the above provision, the application for regularization of provisional registration should have been made either within six months of commencement of activities or latest by September 2023. However, the applicant made application in Form 10AB on 30.11.2024. Thus, the applicant had not filed Form 10AB for regularization of provisional registration within the prescribed time limit. In view of the above violation, a show cause notice was issued to the applicant. However, the ld.CIT observed that the applicant Trust had not offered any comments of delay in filing the application in Form 10AB.In absence of any response made by the applicant Trust to explain the delay caused in filing the application in Form 10AB, the application made by the applicant was treated as invalid. As such, he rejected the application seeking registration under section 12AB of the Act.
6. Before us, the ld.AR has contended that the assessee was granted provisional approval on 28.05.2021. However, it had commenced its activities on 01.04.2020. Thus, the activities had commenced prior to provisional approval. Reliance was placed on the P a g e | A.Y. 2025-26 to 2029-30 Tirth Global Foundation, Mumbai decision in the case of Chopade Charitable Trust v CIT(E) [2024] 167 taxmann.com 702 (Pune - Trib.) in which it was held that sub clause (iii) of the proviso, term, “within six months of commencement of activities” is applicable only for those newly formed trusts which have received the provisional approval without commencement of activities. The assessee also relied upon the case of National Association for the Blind v CIT(E) [2025] 178 taxmann.com 120 (Mumbai-Trib.).
6.1 It was, however, admitted that its provisional registration expired on 31.03.2024. Hence, it ought to have made application by 30.09.2023. However, the Trust has made application on 30.11.2024. In this regard, the assessee relies upon Circular 7 of 2024 which have extended the time period to 30.06.2024.Request was made to condone such delay since the Trustees were under impression that the provisional approval was for 5 years or 10 years. For the first time the Trustees were applying for renewal of provisional approval. The Trust filed financial statements in Form 10BB every year. It files return of income in ITR.as also Form 10BD giving details of donations received. Reliance was placed on Sunworld Society for Social Service v CIT(E) [2025] 176 taxmann.com 758 (Pune - Trib.), where assessee trust filed an application for registration which was rejected on ground that it was filed beyond
P a g e | A.Y. 2025-26 to 2029-30 Tirth Global Foundation, Mumbai prescribed time limit, since newly inserted proviso to section 12A(1)(ac)(vi) of the Act empowers Principal Commissioner or Commissioner to condone delay if they find that there was reasonable cause in not filing application within prescribed time limit, matter was to be remanded back to Commissioner (Exemption) with a direction to treat application as filed within time and decide issue afresh.
We have heard both parties and perused the material available on record. Admittedly, the assessee society was granted provisional registration and had filed "Form 10AB" for regular registration. As observed above, the CBDT, vide Circular No. 7/2024 dated 25.04.2024, had extended the "due date" for filing such application till 30.06.2024, therefore, there can be no denying the fact that the application filed by the assessee society was beyond the prescribed time limit. However, apart from the delay, we find that the impugned order does not record any defect either in the activities or objects of the assessee company or the documents submitted. Also, its bonafides are not in dispute, and the delay in filing the application, in our considered view, prima facie, does not appear to be deliberate.
7.1 We find that on identical issue of delay, the coordinate bench of ITAT, Mumbai in the case of Narke Green Foundation P a g e | A.Y. 2025-26 to 2029-30 Tirth Global Foundation, Mumbai Charitable Institution gave following directions: "5.9 At this juncture we refer to the pragmatic approach advocated by Justice V.R. Krishna Iyer, wherein he advocated a flexible approach to procedural law, that serve as "handmaid" to justice, and not a hinder it. The Principle of Justice Krishna Iyer emphasised that procedural laws should be tools to facilitate administration of justice various decisions of Hon'ble Supreme Court has emphasised to strike a balance between strict adherence to procedural rules and the need to ensure that justice is not denied due to technicalities. 5.10 We agree with the above preposition observed by Hon'ble Pune Tribunal. However genuine and bonafide reason stated by the assessee cannot be over looked. Further we also note that, flexible and pragmatic approach to such procedural laws is necessary as against recognising a strict adherence to do which could sometime lead to injustice. Hon'ble Supreme Court in plethora of cases always emphasised that while considering delay, one must first ascertain bonafides of the explanation offered by the party seeking condonation. Thereafter there must be sufficient cause which is sustainable based on the genuine reasonable explanation. 5.11 While condoning the delay it is crucial to ensure the party seeking condonation provide genuine explanation for the delay. In present facts of the case, we note that, the reason that caused delay is based on a bonafide belief on behalf of the assessee without there being any malafide intention.
In our considered opinion assessee must get an opportunity to present its case before the Ld.CIT(E) and to explain the reason that caused the delay. The Ld.CIT(E) shall consider the application of assessee seeking condonation of delay in accordance with law keeping in view to the above principles of natural justice."
7.2 We find that the legislature in all its wisdom had vide the Finance Act, 2024 from 01.10.2024 made available on the statute a P a g e | A.Y. 2025-26 to 2029-30 Tirth Global Foundation, Mumbai "Proviso" to Section 12A(1)(ac) that formally allows the ld.CIT(E) to condone the delay if reasonable cause is shown. We are of the considered view that the matter deserves to be restored to the file of the ld.CIT (E) for fresh consideration. The assessee society shall remain at liberty to file an application for the condonation of the delay involved in the filing of the present application in "Form 10AB" seeking regular registration under section 12AB of the Act. The ld.CIT shall consider such application in accordance with the extant law and dispose of the same after granting a reasonable opportunity of being heard to the assessee society.
In the result, the appeal is allowed for statistical purposes. of Appeal 1) The Ld. Commissioner of Income Tax (Exemption) [CIT (E)] erred in rejecting the application for approval u/s 80G of the Act dated 30.11.2024 on the grounds that there was no registration u/s 12AB of the Act. 2) The Ld. CIT(E) erred in not appreciating the fact that: The assessee had already obtained Provisional Registration u/s 12A of the Act dated 28.05.2021. The assessee had applied for Final Registration u/s 12AB of the Act on 30.11.2024. Merely due to some procedural irregularity that application was not filed in time, the application for registration u/s 12A of the Act was rejected on 26.06.2025. The assessee has challenged the rejection u/s 12A of the Act before the Hon’ble Income Tax Appellate Tribunal. 3) The assessee prays that, the approval u/s 80G of the Act be granted to the assessee Trust.
P a g e | A.Y. 2025-26 to 2029-30 Tirth Global Foundation, Mumbai 10. It was noticed that the appeal was delayed by 78 days. In this regard, the trustees in the condonation application stated the same reasons as in para 3 above. In view of our decision in para 4 above, we condone the delay.
According to the impugned order, the assessee had filed Form 10AB on 30.11.2024 and requested for approval u/s 80G of the Act, under clause (iii) of first proviso to sub-section (5) of section 80G of the Act.
The applicant has also applied for registration u/s 12AB of the Act vide Form 10AB dated 30.11.2024under clause (iii) of clause (ac) of sub- section (1) of section 12A of the Act. This application had been rejected vide order dated 26.06.2025.He observed that the applicant failed to fulfil any of the criteria in view of the application for registration u/s 12AB of the Act. Thus, its application for approval u/s 80G of the act became untenable. In view of the above, application in Form 10AB for approval u/s 80G of the Act was rejected.
As we have already remanded the issue of grant of registration under section 12AB of the Act to the file of the ld. CIT(E) for de novo adjudication, therefore the order rejecting the application for registration under section 80G of the Act is also set aside and the matter is restored to the file of the ld. CIT(E) for deciding it afresh. As a result,
P a g e | A.Y. 2025-26 to 2029-30 Tirth Global Foundation, Mumbai the grounds raised by the assessee as also the appeal are allowed for statistical purposes.
In the result, both the above appeals of the assessee stand allowed for statistical purposes.
Order pronounced in the open court on 02/02/2026.