AUDACIOUS DREAMS FOUNDATION,VELLORE vs. CIT, EXEMPTIONS,, CHENNAI

The present appeal of the assessee arises out of the order of the Learned Commissioner of Income Tax (Exemptions), Chennai [hereinafter referred to as the “Ld.CIT(E)”] dated 21.06.2025 seeking approval u/s.80G of the Income tax Act, 1961 [hereinafter referred to as “the Act”].

During the course of hearing, the Registry has pointed out that there is a delay of 12 days in filing the present appeal before the Tribunal. The assessee has filed an application explaining the cause of such delay. We have gone through the averments made in the condonation petition and thus, we are of the opinion that the assessee is prevented in filing the appeal belatedly and we are :-2-: ITA. No:2523/Chny/2025 satisfied that the delay in filing the appeal is due to reasonable cause. Consequently, we condone the delay of 12 days in filing the present appeal and admit the same for adjudication on merits.

The sole ground raised in this appeal by the assessee is against rejection of application seeking approval u/s. 80G of the Act on the ground that the same is not maintainable.

The assessee had filed an application dated 05.11.2024 in Form No.10AB under clause (iii) of the first proviso to sub-section (5) of Section 80G of the Act. The Ld.CIT(E) rejected the application on the ground that the trust was required to file the application by 30.06.2024, in view of CBDT Circular No.7/2024 dated 25.04.2024, but has filed it on 05.11.2024, with a delay of 128 days. The Ld. CIT(E) held the application to be not maintainable.

The Ld.AR of the assessee has submitted that the assessee had filed an application under clause (iii) of the first proviso to sub-section (5) of Section 80G of the Act. As per the earlier provisions, the application was required to be made on or before September 2023, i.e., six months prior to the expiry of the provisional approval period, which ended on 31.03.2024. Subsequently, the CBDT issued Circular No.7/2024 dated 25.04.2024, extending the due date for filing the application to 30.06.2024. The Ld.AR further submitted that Section 80G has been amended by inserting clause (iv) in the first proviso to Section 80G(5), which now allows an assessee that has commenced its activities to apply for approval at any time after such commencement. Accordingly, it was submitted that the assessee’s application may be considered under clause (iv)(B) of Section 80G(5) of the Act. The Ld.AR also referred to the Memorandum explaining the provisions of the Finance Bill, 2024, wherein the insertion of clause (iv) was proposed to rationalize the timeline for filing the application for approval by providing to file application any time after commencement of activities. In view of this amendment, the Ld.AR requested

On the other hand, the Ld.DR has relied on the orders of Ld.CIT(E) and argued that assessee can now file fresh application as per the amended provision under clause (iv)(B) of Section 80G(5) of the Act.

We have heard the rival submissions perused the materials available on record and gone through the order of the ld.CIT(E). The assessee made an application under clause (iii) of first proviso to sub-section (5) of Section 80G of the Act seeking approval u/s. 80G of the Act on 05.11.2024. The Ld.CIT(E) has rejected the application as not maintainable on the ground that the assessee has not filed the application before 30.06.2024 as provided in CBDT Circular No.7/2024 dated 25.04.2024. However, it is noted that clause (iv) has now been inserted into the first proviso to Section 80G(5) by the Finance Act, 2024, w.e.f 01.10.2024 to enable assessee-trust to apply for approval u/s.80G(5) of the Act at any time after commencement of its activities. This provision is disjoint from clause (iii), which governed the earlier timeline. The Ld.CIT(E) has passed the order rejecting application on 21.06.2025 after the amendment had come into force, as not maintainable.

The coordinate bench of the Tribunal in the following case has already decided the similar issue in the identical set of facts and has directed the ld.CIT(E) to consider the application filed by the assessee belatedly as valid and to decide the issue in accordance with law:

In the present facts and circumstances of the case and respectfully following the decision of the coordinate bench of the Tribunal (supra), we

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