K.C.A. CHARITABLE TRUST,KOLKATA vs. CIT(EXEMPTION), KOLKATA

The present appeal has been filed by the assessee against the order dated 20.11.2023 of the Commissioner of Income Tax (Exemption), Kolkata [hereinafter referred to as ‘CIT(Exemption)’] rejecting the application of the assessee for final approval as per the provisions of section 80G(5)(iii) of the Income Tax Act (hereinafter referred to as the ‘Act’).

The only issue raised in the various grounds of appeal is against the order of Ld. CIT(E), Kolkata not granting the approval u/s 80G(5)(iii) of the Act on the ground that the application filed in Form 10AB u/s 80G(5)(iii) was not maintainable.

Facts in brief are that the assessee was granted provisional approval u/s 80G(5)(iv) of the Act in Form 10AC vide order dated 31.12.2021 for a period from 31.12.2021 to AY 2024-25. Thereafter an application for approval of the trust u/s 80G(5)(iii) of the Act was electronically filed on 4.05.2023 in Form 10AB under Rule 17A of the Income Tax Rules, 1962(hereinafter referred to as Rules). The Ld. CIT(E), after calling for reply and K.C.A Charitable Trust explanation on the point and after taking into account various evidences filed by the assessee, observed that the provisions of Section 80G(5)(iii) stipulate a time limit within which the assessee is required to file application u/s 80G(5)(iii) of the Act whereas the assessee has filed application on 04.05.2023 which is beyond the time frame as mentioned in that Section. The Ld. CIT(E) further observed that the assessee was required to file application in Form 10AB u/s 80G(5)(iii) within a time period of six months of the commencement of its activities or before the expiry of six months prior to expiry of the period of the provisional registration whichever is earlier. The ld CIT(E) also noted that the filing of application for approval within such time is mandatory and he has no power under the Act to condone the delay in filing the said application. Accordingly he dismissed the application as not maintainable.

After hearing the rival contentions and perusing the material on record, we find that the assessee is duly registered u/s 12A of the Act enjoying exemption u/s 80G(5) of the Act. We note that the assessee is an old one and the activities of the institution were started long ago. We are also mindful of the recent CBDT F. No. 173/25/2024-ITA-I, Circular no. 7/2024 dated 25.04.2024 allowing the various trust/institution file application for approval u/s 80(5) electronically up to 30.06.2024. The said circular is extracted below for the sake of convenience and ready reference: K.C.A Charitable Trust K.C.A Charitable Trust We note that since the assessee is duly registered u/s 12A of the Act and We note that since the assessee is duly registered u/s 12A of the Act and We note that since the assessee is duly registered u/s 12A of the Act and was granted provisional approval under section 80G(5)(iv) up to AY 2 provisional approval under section 80G(5)(iv) up to AY 2024-25 vide order dated 25 vide order dated 31.12.2021 in Form 10AC and there is no change in the activities of the assessee in Form 10AC and there is no change in the activities of the assessee in Form 10AC and there is no change in the activities of the assessee whatsoever. Therefore we are of the view that the filing of application is just pr whatsoever. Therefore we are of the view that the filing of application is just pr whatsoever. Therefore we are of the view that the filing of application is just procedural formality and would not substantially change the position of the assessee vis and would not substantially change the position of the assessee vis and would not substantially change the position of the assessee vis-à-vis the provisions of Act. Moreover in view of Circular No. 7/2024 dated 25.04.2024 , now the provisions of Act. Moreover in view of Circular No. 7/2024 dated 25.04.2024 , now the provisions of Act. Moreover in view of Circular No. 7/2024 dated 25.04.2024 , now the 4 K.C.A Charitable Trust assessee can apply for approval up to 30.06.2024. Considering these facts and circumstances of the case, we restore the issue back to the Ld. CIT(E) with direction to decide the issue of approval after treating the application already filed by the assessee as filed within the due time.

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