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2024 (5) TMI 185 - AT - Income TaxApproval Application made u/s 80G (5) - rejection of application as belatedly filled - HELD THAT - As decided in M/S. CIT-1982 CHARITABLE TRUST 2024 (3) TMI 1201 - ITAT CHENNAI ITAT correctly observed that there is no reason to provide for a distinction within the same provision, so as to have a different timeline for accepting application for grant of final approval in respect for grant of registration in Form No. 10AB for registration u/s 12A of the Act and for grant of final registration u/s 80G(5). ITAT, in our view has correctly observed that there cannot be a distinction within the same provision for having different time-lines, without bringing out any exception and further, even the provisions of Section 80G are for the benefit of the donors, who are donating money to the charitable trust for claiming exemption in their returns of income. We observe that the assessee had filed Form 10AB for grant of final registration u/s 80G of the Act on 04.02.2023 i.e. within the extended time-line provide vide CBDT Circular with respect for final registration of Trust u/s 12A of the Act in Form 10AB i.e. 30.09.2023. Accordingly, in light of the aforesaid Ruling, the order of CIT(Exemptions) on this issue is set aside, and matter is remanded to the file of CIT(Exemption) for re-deciding the issue of grant of final registration u/s 80G(5), on merits, as per law. Appeal of the assessee is allowed for statistical purposes.
Issues Involved:
1. Rejection of application u/s 80G(5) due to late filing. 2. Consideration of genuine hardship in filing Form 10AB. 3. Interpretation of the timeline and conditions for filing applications under Section 80G(5). 4. Authority of CIT(E) to condone delay in filing applications. 5. Applicability of judicial precedents and CBDT circulars in extending deadlines. Summary: Issue 1: Rejection of Application u/s 80G(5) Due to Late Filing The assessee filed an application u/s 80G(5) in Form No. 10AB, which was rejected by the CIT(E) on the grounds that it was filed beyond the prescribed timeline. The CIT(E) noted that the application should have been filed at least six months prior to the expiry of the provisional approval or within six months of commencement of activities, whichever is earlier. The application was filed on 04/02/2023, whereas the deadline was 30/09/2022. Issue 2: Consideration of Genuine Hardship in Filing Form 10AB The assessee argued that the delay was due to genuine hardship and changes in the law regarding provisional and regular registration. The Counsel for the assessee cited various judicial precedents and CBDT circulars that extended the deadlines for filing such applications, arguing that the timelines should be treated as directory rather than mandatory. Issue 3: Interpretation of Timeline and Conditions for Filing Applications under Section 80G(5) The ITAT referenced the case of CIT-1982, Charitable Trust, which held that the timeline for filing Form No. 10AB should be treated as directory and not mandatory. The ITAT observed that there should not be a distinction within the same provision for different timelines for final approval applications under Section 12A and Section 80G(5). Issue 4: Authority of CIT(E) to Condon Delay in Filing Applications The CIT(E) stated that they had no power to condone the delay in filing the application. However, the ITAT noted that the ITAT itself has the power to condone such delays, especially considering the transitional nature of the amendments and the genuine hardship faced by the assessee. Issue 5: Applicability of Judicial Precedents and CBDT Circulars in Extending Deadlines The ITAT relied on various judicial precedents and CBDT circulars that extended deadlines for filing applications under Section 12A and argued that the same extensions should apply to applications under Section 80G(5). The ITAT set aside the CIT(E)'s order and remanded the matter back for re-decision on merits, considering the extended timelines. Conclusion: The ITAT concluded that the timeline for filing Form No. 10AB should be treated as directory and not mandatory, and remanded the matter back to the CIT(E) for re-decision on merits, considering the extended deadlines and genuine hardship faced by the assessee. Both appeals were allowed for statistical purposes.
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