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Facts
The assessee, Shri Guru Ganesh Shri Guru Mishri Gorakshan Charitable Trust, sought approval under section 80G(5)(iii) of the Income Tax Act, 1961, but its application was denied by the National Faceless Appeal Centre (NFAC). The denial stemmed from an inadvertent mistake by the assessee's consultant who, after an initial correct provisional registration, mistakenly applied for a fresh provisional registration under an incorrect sub-clause, leading to the subsequent rejection of the regular approval application.
Held
The Tribunal acknowledged the assessee's consultant's inadvertent error in citing the wrong sub-clause for provisional registration. Recognizing the need to assess the application on merits, the Tribunal decided to remand the matter back to the CIT (Exemption) to provide the assessee with another opportunity to present its case for regular approval under section 80G(5), ensuring a reasonable hearing.
Key Issues
Whether the denial of regular approval under section 80G(5)(iii) of the Income Tax Act, 1961, was appropriate when the rejection was based on an inadvertent error by the assessee's consultant in previous provisional registration applications.
Sections Cited
Income Tax Act, 1961, Section 80G(5)(iii), Section 80G(5)(iv), Section 80G(5)(i), Section 80G(5)(vi)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, PUNE BENCHES “B”, PUNE
Before: DR.MANISH BORAD & SHRI VINAY BHAMORE
आदेश / ORDER
PER DR. MANISH BOARD, ACCOUNTANT MEMBER :
The captioned appeal at the instance of assessee is directed against the order dated 03.06.2025 framed by National Faceless Appeal Centre, Delhi denying application for grant of approval u/s.80G(5)(iii) of the Income Tax Act, 1961.
The only grievance of the assessee is against the denial of application made for approval u/s.80G(5)(iii) of the Act.
At the outset, ld. Counsel for the assessee requesting for setting aside the issue to the file of ld.CIT (Exemption) for one more round of adjudication on the ground that the assessee in the provisional registration for the first time had mentioned the correct clause and provisional registration was granted. However, ld. AR again revised the application for provisional registration u/.80G and mentioned the wrong clause eventhough the previous provisional registration was existing. Subsequently, when the assessee filed an application for regular approval u/s.80G(5) of the Act the same has been denied by the ld.CIT (Exemption) making reference to the second incorrect application filed by the assessee for provisional registration. Therefore, he submitted that one more opportunity may be granted to the assessee to please before ld.CIT(Exemption).
On the other hand, ld. Departmental Representative supported the order of ld. CIT (Exemption).
We have heard the rival contentions and perused the record placed before us. We observe that the assessee has filed application u/s.80G(5) of the Act for grant of regular approval vide application dated 05.01.2025 furnished on Form No.10AB. Ld.CIT (Exemption) has rejected the assessee’s application observing as follows :
“7. The assessee vide its reply dated 06/05/2025 admitted the fact that the trust had inadvertently applied under sub-clause (i) of first proviso to sub section (5) of 80G in Form 10AC and granted approval on 08/07/2024. However, the assessee was not approved under section 80G(5)(vi) of the Act prior to 01/04/2021. Therefore, the copy of registration furnished by the assessee under clause (i) of first proviso to section 80G(5) of the Act is not a valid registration.
Further, the assessee stated that it had applied for the renewal of registration under section 80G(5) (iii). However, the provisions of said clause are applicable to a trust or institution which is provisionally approved under clause (iv) of first proviso to said section. Therefore, the copy of order of provisional approval under section 80G(5) (vi) of the Act in form No.10AC Issued under the provisions of clause (iv) of proviso to section 80G(5) of the Act was required to be submitted by the assessee. However, it is seen that the copy of such provisional approval has been surrendered by the assessee. Hence, it seems the assessee was not having provisional approval under section 80G(5)(vi) of the Act as on the date of present application. Therefore, the prerequisite for application under clause
(iii) of first proviso to section 80G(5) of the Act is not fulfilled in this case.” 6. We on going through the submissions made by ld. Counsel for the assessee find that the assessee has filed a reply before ld.CIT( Exemption) which is referred in para 6 of the impugned order. Contents of the said reply reads as follows :
“6. The assessee furnished reply on 06/05/2025. The part of the submission reproduced as under:
The assessee had initially applied and granted provisional registration under clause (iv) of first proviso to sub section (5) of section 80G dated 10/03/2022. The period covered was 10/03/2022 to AY 2024-25. Therefore, the appellant was then required to apply for renewal of registration. However, inadvertently the assessees consultant applied again under clause (i) of clause (i) of first proviso to sub section (5) of 80G and was granted approval on 08/07/2024. This was inadvertent mistake by the consultant. The assessee submits that, as per his consultant, he did not apply for surrender of earlier Form 10AC dated 10/03/2022. It may have been surrendered automatically once fresh application was inadvertently made. Thereafter, the consultant has applied for renewal of registration under section 80G(5)(iii) on 05/01/2025 which is under consideration. The assessee submits that, inadvertent mistake of the trust may kindly be ignored and application be processed considering correct provisions of law.
Considering the submission made by the ld. Counsel for the assessee along with the reply filed by the assessee before ld.CIT(E), we notice that the assessee inspite of having a valid provisional registration has again filed an application for getting provisional registration mentioning the wrong clause (i) of first proviso to section 80G(5) as against the correct clause (iv) of first proviso to section 80G(5). For such inadvertent mistake by the assessee application has been rejected. We therefore deem it appropriate to grant one more opportunity to the assessee by remitting the issue to the file of ld.CIT(Exemption) for deciding the application filed by the assessee for regular approval u/s.80G(5) of the Act after dealing with the merits of the case. Needless to mention that ld.CIT(Exemption) shall give reasonable opportunity to the assessee in such set aside proceedings. Impugned order is set aside and the grounds of appeal raised by the assessee are allowed for statistical purposes.
In the result, the appeal filed by the assessee is allowed for statistical purposes.
Order pronounced on this 06th day of January, 2026.