2024 (1) TMI 877 - AT - Income Tax

Rejection of Application u/s 80G(5) - non-compliance with the prescribed time limits for filing the application in Form No.10AB. - HELD THAT - Respectfully following the judgement of the Hon ble Delhi High Court in the case of Vishwa Jagriti Mission 2013 (1) TMI 157 - DELHI HIGH COURT wherein the delay in filing application for registration u/s 12A, was allowable / condoned, hence, we condone the delay in filing Form 10AB, u/s 80G(5), and remit the matter back to the file of Ld.CIT(E) with the direction to decide the application of assessee, in accordance with law. The assessee is also directed to file details and documents, before ld CIT(E), as and when, required by ld CIT(E). For statistical purposes, the appeal of the assessee is treated to be allowed.

Summary

Issues Involved:
1. Rejection of application u/s 80G(5)(iii) due to late filing.
2. Whether the Tribunal has the power to condone the delay in filing the application.

Summary:

Issue 1: Rejection of application u/s 80G(5)(iii) due to late filing.

The assessee-trust filed an application in Form No.10AB electronically for approval u/s 80G(5)(iii) of the Income Tax Act, 1961. The Ld. Commissioner of Income Tax (Exemption) [CIT(E)] rejected the application on the grounds that it was not filed within the prescribed time limit. The CIT(E) noted that the assessee was required to file the application at least six months prior to the expiry of the provisional approval or within six months of the commencement of its activities, whichever is earlier, as per the 3rd proviso of section 80G(5). The CIT(E) relied on the judgment of Kolkata Tribunal in the case of Bishnupur Public Education Institute, which held that the Commissioner has no power to condone the delay in filing such applications. The assessee's application was delayed by 147 days, and the CIT(E) canceled the provisional approval granted in Form No.10AC.

Issue 2: Whether the Tribunal has the power to condone the delay in filing the application.

The Tribunal considered the undue hardship caused by the clause (iii) of the 3rd proviso of section 80G(5) and noted that the CBDT's latest Circular No.6/2023 did not extend the time limit for filing Form No.10AB u/s 80G(5)(iii). The Tribunal found merit in the assessee's submission that it is impossible for an old trust to file the application within six months of commencement of its activities. The Tribunal referred to the judgment of the Hon'ble Delhi High Court in the case of DCIT(Exemption) vs. Vishwa Jagriti Mission, which allowed for the condonation of delay in similar circumstances. The Tribunal concluded that it has the power to condone the delay in the interest of justice and remitted the matter back to the file of Ld.CIT(E) with the direction to decide the application in accordance with the law.

In the combined result, both appeals (ITA No.728 & 732/SRT/2023) are allowed for statistical purposes. The order was pronounced on 09/01/2024 by placing the result on the notice board.