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Income Tax Appellate Tribunal, PUNE ‘B’ BENCH, PUNE
Before: HON’BLE SMT ASTHA CHANDRA & SHRI G. D. PADMAHSHALI
V/s The Commissioner of Income Tax ....... प्रत्यर्थी / Respondent (Exemption), Pune Appearances Assessee by : Mr Sanket Joshi [‘Ld. AR’] Revenue by : Mr Ajaykumar Kesari [‘Ld. DR’] Date of conclusive Hearing : 16/10/2024 Date of Pronouncement : 17/10/2024 ORDER PER G. D. PADMAHSHALI, AM; By present twin appeals, the assessee trust impugns separate orders of rejection passed u/s 12A(1)(ac)(vi) and u/s 80G(5) of the Income Tax Act [in short ‘the Act’] by the Commissioner of Income Tax-Exemption, Pune [in short ‘CIT(E)’] vide DIN & Order No. ITBA/EXM/F/EXM45/2023- 24/1055306534(1) 1055306937(1) both dt. 22/08/2023.
Since facts and issues involved in these twin appeals are identical, common & interrelated, on the request from rival parties and for the sake of brevity these appeals are heard together for being disposed-off by a common and consolidated order.
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& 1521/PUN/2024 3. Admittedly, these twin appeals are instituted with a delay of 273 days. We have considered the reasoning in the light of corroborative documents, letters & submission etc., and found them falling within the parameters set for condonation by various judicial precedents including ‘Vijay Vishin Meghani Vs. DCIT & Anr’ [398 ITR 250 (Bom)], ‘Collector, Land Acquisition, Anantnag and Anr. Vs Ms Katiji and Others’ [167 ITR 5 (SC)] The reasons since being accidental and undeliberate on the part of appellant, are very much capable of forming ‘sufficient cause or reasons’ for the purpose of s/s (5) of section 253 of the Act which in our considered view prevented the appellant trust from instituting these present twin appeals within the statutory time allowed under s/s (3) of section 253 of the Act. The said delay therefore is condoned and advanced accordingly.
Without touching merits of these cases, we have heard rival parties’ common submissions on limited issue of rejection in limine; and subject to rule 18 of ITAT Rules, 1963 perused material placed on record and thoughtfully considered the rival reliance.
5. We note that, the appellant vide Form No. 10AB dt. 30/03/2023 filed an application to the respondent under clause (iii) of section 12A(1)(ac) of the Act seeking thereby regular/final registration u/s 12AB of the Act. On the appellant’s effective failure to annexe required documents as contemplated u/r 17A(2)(k) of IT-Rules, the Ld. CIT(E) by notice dt.
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& 1521/PUN/2024 11/07/2023 accorded an opportunity to make good the deficiency. In the event of failure vide further notice dt. 27/07/2023 one more opportunity was granted to cure the defects & remove the discrepancies notified. It was also informed by the registering authority that in the event of failure on the part of assessee to comply with the notices and resolve the discrepancies the application would be rejected and provisional registration granted to it on earlier occasion would be cancelled. In absence of compliance from the appellant assessee, the Ld. CIT(E) was constrained to reject to grant regular registration and cancel the provisional registration granted to appellant on 04/04/2022 u/s 12AB r.w.s. 12A(1)(ac)(vi) of the Act as he could not draw any satisfactory conclusion about genuineness of activities of the appellant and satisfaction over compliance of requirements of any other law for the time being in force as are material for the purpose of achieving objective.
The statue empowers the registering authority to call any such documents or information so as to satisfy himself with twin prescriptions of section 12AB(1)(b)(i) of the Act viz; (A) genuineness of activities (B) Compliance with all applicable laws etc., and in order to draw conclusion over satisfaction the registering authority is duty bond to carry out wholesome & autonomous exercise according to nature/character of charitable purpose vis-a-vis the applicant engaged into. In arriving to conclusion over satisfaction about the genuineness of activities and compliance of applicable law, the registration proceedings is expected to ITAT-Pune Page 3 of 10
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& 1521/PUN/2024 vouch predominantly; (i) whether applicant is a public charitable trust established in accordance with applicable law & in operation as such [Constitution/Establishment] (iii) whether all the entries of object clause are in consonance with the ‘charitable purpose’ as defined by section 2(15) of the Act [Objects] (iv) whether there exist any implied or express provision in the constitutional & other administrative documents/policies etc., entitling any right or power to the trust/trustee carry to engage (by itself or through agent/appointees) into any activities outside the ambit of registered objects [Rights/Power] (vi) whether all the activities and operation are strictly carried out in line with the registered objects of ‘charitable in nature’ [Activity] and finally (vii) whether it is compliant of all the applicable law in all respect and around the clock[Compliance]. Any proceedings culminated without vouching these former key factual (Corac) would prima-facie be deficient as it may lead to absurd conclusion.
In the instant case we find that, predominantly for the want of evidential documents and failure on the part of appellant to cure all notified deficiencies/discrepancies the Ld. CIT(E) had to culminate the impugned registration proceedings without former wholesome & autonomous exercise. The rejection is admittedly attributable to non-compliance on the part of the assessee Trust. The reasons behind such non-compliance as stated in the ‘undated notarised affidavit’ executed by one of the Trustee/Principal Officer ‘Mr Kumar Sadanandan’, we observed that, all ITAT-Pune Page 4 of 10
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& 1521/PUN/2024 notices of hearing issued by the Ld. CIT(E) during the pendency of proceedings were in fact communicated not to the registered/official email- id sngtrustnashik@gmail.com of the Trust but to an email-id kankkalilanian51@gmail.com which was belonging to one of the trustee who wasn’t attending those email hence could not fetch them and forward them to the Trust well in time. Since these notices never reached the appellant trust, therefore went unattended. In this clinching factual position, we are of the considered view that non-compliance was utterly accidental and undeliberate on the part of appellant. Therefore, in the larger interest of justice we deem it necessary to accord one more opportunity to the assessee for curing defects notified to it and due compliance which can only be possible on remand. In view thereof, without commenting on merits we set-aside the impugned order in its entirety and remit the matter back to the file of Ld. CIT(E) at the stage of issuance of notice dt. 27/07/2023 for de-novo consideration on merits in accordance with law in three effective hearings.
8. The long and short of the case is that; the appellant’s application for provisional registration u/s 80G(5)(iv) of the Act was accepted by the respondent Revenue and certificate to that effect vide order dt. 04/04/2022 was issued. In compliance of terms of condition of provisional registration and applicable provisions of the Act, the assessees vide its ITAT-Pune Page 5 of 10
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& 1521/PUN/2024 application From No. 10AB CIT EXEMPTION, PUNE/2023- 24/12AA/11224 dt. 30/03/2023 applied for regular/final 80G approval/registration, this application however by the impugned order is rejected by the Ld. CIT(E) in limine on the ground that the application is barred by limitation. In view of the Ld. CIT(E), since the appellant had already commenced its activities much before the issue of provisional registration granted to it on 04/04/2022 hence was under obligation to file an application seeking regular 80G registration within a period of six months therefrom i.e. by 03/10/2022. It is further the case of the Revenue that, delayed application filed was even beyond the extended time allowed by CBDT Circular 08/2022 dt. 30/09/2022. Thus said application of the appellant was barred by limitation and in absence of statutory provision empowering condonation of delay the application deserved rejection in the light of decision of Hon’ble Madras High Court in ‘All Angels Educational Society Vs CCIT’ [2016, WP/4969/2014] and the judgments of Hon'ble Supreme Court in the case of State of ‘UP Vs Harish Chandra’ [AIR 1996 SC 2173]; further ‘UOI Vs Kirloskar Pneumatic Co. Ltd.’ [1996, 84 ELT 401 (SC)]
Aggrieved assessee brought up the present appeal before Tribunal on five argumentative legal grounds which we found are inconsonance with rule 8 of ITAT Rules, 1963. These however call for adjudication on the grounds of limitation and violation of principle of natural justice & merits.
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& 1521/PUN/2024 10. We have given our thoughtful consideration and perused the material available on record. It remained undisputed that, the appellant commenced its activities much before it was granted a provisional registration u/s 80G(5)(iv) of the Act on 04/04/2022 and therefore was under obligation to file form 10AB for regular/final registration before the expiry of six months in terms of clause (iii) of first proviso to s/s (5) of section 80G of the Act i.e. by 03/10/2022. The appellant filed its application for grant of regular registration on 30/03/2023. The application prima-facie was filed after the expiry of former stipulate period. As a result, the application was rejected by the Revenue in limine on threefold grounds viz; (i) the application is barred by limitation, (ii) the appellant was not entitled to the extended time period in terms of circular 08/2023 dt. 24/05/2023, (iii) in absence of explicit provision/power to condone the delay in filing application for regular/final registration and finally (iv) in the absence of regular registration certificate 12AB of the Act.
There is no dispute over (i), & (iii) reasoning founded by the Ld. CIT(E). Insofar as (iv) reasoning relating to non-submission of copy of 12AB registration certificate is concerned, it would only be possible for the assessee trust once remanded matter ( ) is conclusively adjudicated. Thus this appeals remains with a solitarily question over applicability of circular 08/2023 in cases where provisional approval u/c (iv) of first proviso to s/s (5) of section 80G of the Act.
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& 1521/PUN/2024 12. Without reproducing lock stock and barrel of section 80G of the Act, it shall be purposive to state in the context of time limit that, there is no provision in the statute which empowers the registering authority to condonation of delay in filing forms like 10A/10AB etc. Nevertheless the mother body Central Board of Direct Taxes [in short ‘CBDT’] invoking its power u/s 119 of the Act in addressing the stakeholders inconvenience/system glitches vide circular No. 8/2022 dt. 31/03/2022 had extended the time limit within which the application for regular registration is to be filed to 30th September, 2022. Further on the representation from stakeholders/industry that various trust/intuitions etc., were not been able to file applicable forms 10A/10AB etc., within the due date prescribed owning to system glitches, the Board for removing this genuine hardship vide circular 06/2023 dt. 24/05/2023 further extended the time limit to 30/09/2023 in all cases where the due date for making application has expired prior to such date. The para 5(i) r.w. para 1(c) of the former circular (supra) makes it very clear that the circular besides covering cases of 10(23) and 12A registration also covers the cases falling u/c (i) of the first proviso to s/s (5) of the 80G of the Act. The clause (i) in turn refers to institutions or funds approved u/c (vi) by Ld. PCIT/CIT in relation to donation made after 31/03/1992. That is to say the assessee who is granted provisional registration by an order u/c (vi) of 80G(5) would then be entitled to extended time by virtue of 5(i) r.w. para 1(c) of circular (supra) and not otherwise.
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& 1521/PUN/2024 13. In the present case before us, reading from para 7 of impugned order it as an undisputed fact that the appellant assessee was granted a provisional registration u/c (iv) of s/s (5) of section 80G of the Act by an order u/c (vi) of s/s (5) of section 80G of the Act by the Ld. CIT(E). Therefore, there remains no reason to cherry pick appellant’s case for precluding from availing the benefit of extended period available to it for filing application for regular registration. It is also apt to mention here that, the circular (supra) also clarified clearly that, the extended period upto 30/09/2023 shall apply even in cases, (i) where the application was rejected by the CIT(E) on or before issuance of this circular dt 24/05/2023 (ii) where due date for making/filing application has expired, on or before 30/09/2023. Since the impugned order of rejection was passed outstepping the aforestated binding circular, therefore cannot be permitted to continue.
On the other hand, on a specific query raised by the bench, the appellant adverting to ‘undated affidavit’ executed by one of its trustee has reiterated the reasons beyond delayed filing of application. While remanding the matter relating to rejection of 12AB application we have already found the stated like reasons ‘sufficient’. Same shall mutatis- mutandis apply to the issue under consideration too.
We find in similar facts & circumstance, the co-ordinate benches allowed benefit of extended time period in; ‘Rotary Club of Akurdi Charitable Trust’ [ITA 1025/PUN/2024] ‘Shashvat Paediatric Care ITAT-Pune Page 9 of 10
Shri Narayan Gurudeva Trust Vs CIT(E) & 1521/PUN/2024 Foundation’, [ITA 1217/PUN/2023] ‘Sarathi Youth Foundation’ [ITA/PUN/2024] ‘Birmani Charitable Foundation’ [162 Taxmann.com 154] ‘Swachh Vapi Mission Trust Vs CIT(E)’ [2024, 70 CCH 188] ‘TB Lulla Charitable Foundation Vs CIT(E)’ [2024, 70 CCH 176], and ‘Gujarat Hira Bourse & Ors’ [2024, 70 CCH 33],‘Bhamashah Sundarlal Daga Charitable Trust’ [2024, 226 TTJ 961]. Maintaining parity with former decisions, we hold the application of the appellant was filed well within the extended time limit and in consequence we set-aside the impugned order of rejection for remand with a direction to treat appellant’s application dt. 30/03/2023 as filed within the time limit prescribed u/c (iii) to first proviso to section 80G(5) of the Act r.w.c. 06/2023 (supra) & adjudicate the same on merits.
Before we depart, it is needless to state that, the Ld. CIT(E) shall first deal chronologically with matter remanded in i.e. the application seeking grant of regular registration u/s 12AB of the Act and then deal with matter remanded in i.e. the application for grant of approval of 80G(5) of the Act.
These twin appeals in result are ALLOWED FOR STATISTCIAL PURPOSES. U/r 34 of ITAT Rules, these orders pronounced in open court on this Thursday, 17th day of October, 2024.
-S/d- -S/d- ASTHA CHANDRA G. D. PADMAHSHALI JUDICIAL MEMBER ACCOUNTANT MEMBER पुणे / PUNE; दिन ांक / Dated : 17th day of October, 2024. आदेशकीप्रतितितिअग्रेतिि / Copy of the Order forwarded to : 1.अपील र्थी / The Appellant. 2. प्रत्यर्थी / The Respondent. 3. The Pr.CIT(Exemption),Pune 6.ग र्डफ़ इल / Guard File. 4. The CIT-Concerned(MH-India) 5. DR, ITAT, Bench ‘B’, Pune आिेश नुस र / By Order वररष्ठदनजीसदिव / Sr. Private Secretary आयकरअपीलीयन्य य दिकरण, पुणे / ITAT, Pune.
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