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TMI Blog2024 (9) TMI 339X X X X Extracts X X X X X X X X Extracts X X X X ..... essee. Appeal of the assessee is allowed for statistical purposes. - Ms. Annapurna Gupta, Accountant Member And Shri Siddhartha Nautiyal, Judicial Member For the Assessee :Shri Rohan Thakkar, A.R. For the Revenue :Shri Sanjay Punglia, CIT-D.R. ORDER PER : SIDDHARTHA NAUTIYAL, JUDICIAL MEMBER:- This appeal has been filed by the Assessee against the order passed by the Ld. Commissioner of Income Tax (Exemptions), (in short Ld. CIT(E) ), Ahmedabad vide order 24.11.2023. 2. The Assessee has taken the following grounds of appeal:- 1. The Ld Commissioner of Income Tax (Exemption), has erred in facts and in law in rejecting the application under section 80G (5) for the reason that the trust university has made application for final registration on 28.03.2023 where as it was required to make on or before 30.09.2022 as it has already commenced 06.03.2004 activities on 06-03-2022. 2. The Ld Commissioner of Income Tax (Exemption), has erred in facts and in law in rejecting the application under section 80G (5) for the reason that the trust university has made application for final registration within the validity of provisional registration and that the provisional registration is valid til ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0G for the period commencing from 26/10/2022 to AY 2025-26. 5.1 Vide notice dated 03/08/2023, the applicant was intimated the followings: 5. It is to be bring to your notice that you have filed in Form 10AB for registration under clause (iii) of first proviso to section 80G(5) of the Income Tax Act 1961, which states as under where the institution or fund has been provisionally approved, at least six months prior to expiry of the period of the provisional approval or within six months of commencement of its activities, whichever is earlier. 6. Therefore, the date of commencement of activities in your case should also be 6 month prior to the date of filing of Form 10AB You may note that the benefit of circular No 6/2023 dated 24.05 2023 of CBDT for filing belated application under clause (i) of first proviso to section 80G (5) was also available till 30.09.2022 only. 7. Therefore, If the activities of the fund/institution are not commenced within stipulated time as discussed above, you are requested to explain as to why the present application filed in section 80G (5) (ii) in form No. 10AB should not be treated as not filed within due date specified in the Act why the same should no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... approval under Section 80G(5) of the Act within a period of six months from the date of grant of provisional registration. In the instant case, the Counsel for the assessee submitted that the assessee has satisfied the above time lines and has made application for grant of final registration (on 28.03.2023) within 6 months from date of grant of provisional registration (as on 26.10.2022). Accordingly, the Ld. CIT(E) erred in facts and in law in not granting registration / refusing to grant final registration under Section 80G (5) of the Act. 5. In response, the Ld. D.R. submitted that since the Applicant Trust had filed application for grant of registration beyond the stipulated time, there is no error in the order of CIT(E) denying the grant of registration to the Applicant Trust. 6. We have heard the rival contentions and perused the material on record. 7. In the instant case we observe that the assessee / Applicant Trust was incorporated on 06.03.2004. Therefore, it would be reasonable to presume that the assessee / Applicant Trust had commenced it s activities prior to Amendments brought in grant of registration of Trust effective from 01.04.2021. Therefore, the first question ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 01.04.2021 and this amendment was made with the objective that it needs improvement with the advent of technology and keeping in mind the practical issue of difficulty in obtaining registration/approval/notification before actually starting the activities. To make the process of registration completely electronic under a 16 digit Unique Registration Number (URN), the new regime was introduced for new as well as to existing charitable institutions. Due to change in law, a new clause (ac) has been inserted in sub-section (1) of section 12A w.e.f. 01.04.2021 which states that notwithstanding anything contained in clauses (a) to (ab), the person in receipt of the income who wants to claim benefit of section 11 12 is to made an application in the prescribed form 10A or 10AB and in prescribed manner to the Principal Commissioner or Commissioner, for registration of the Trust or institution. 7.3 Similarly, for approval u/s. 80G of the Act, similar changes were effected in the provisions of section 80G (5), the first and second provisos, which were made applicable with effect from 01.04.2021 for existing Trusts as well as new Trusts or entities. This amendment is brought in by Taxation and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t rejected the application for final approval applied u/s. 80G of the Act in Form No.10AB vide order dated 25.09.2023 by CIT(Exemption) on the reason that the application was filed by assessee only on 17.03.2023, which is belated application. There is no dispute about the final registration granted to the assessee Trust u/s.12A of the Act in Form No.10AD under the new regime vide order dated 13.09.2023 but rejected assessee s application filed in Form No.10AB u/s. 80G of the Act dated 17.03.2023 vide order dated 25.09.2023 as the application is a belated one. 7.5 We have considered the case laws of Co-ordinate Bench of Jaipur Tribunal in the case of Go Gram Eco Foundation, supra and noted that the Jaipur Bench has considered this issue of delay in application filed in Form No.10AB in term of clause (iii) of first proviso to section 80G(5) of the Act, wherein the provisional registration was granted to the assessee Trust on 16.10.2021 in Form No.10A u/s.12A(1)(ac)(vi) and under clause (iv) of first proviso to section 80G(5) of the Act. In that case, the provisional registration was granted in form No.10AC on 27.10.2021. Admitted fact in the case is that the assessee Trust commenced ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0(23C)(vi) of the Act rejected by CIT(Exemption) relating to assessment years 2016-17, 2017-18 2018-19. The assessee s application was dated 11.02.2019 under the old regime. The new regime of taxation of charitable Trusts / institutions started w.e.f. 01.04.2021 and hence, reliance placed by Revenue on the Co-ordinate Bench decision of Kolkata Tribunal in the case of Bishnupur Public Education Institute, supra is not at all relevant and even the case law of Hon ble High Court of Madras and the Hon ble High Court of Andhra Pradesh are also relating to taxation of old regime prior to 01.04.2021. Hence, these are clearly distinguishable on facts and hence, not applicable. In term of the above, we now go through the factual aspect. 7.8 After hearing the arguments of ld. counsel for the assessee and ld. CIT-DR as noted above, we find from the facts that the timeline prescribed for filing Form No.10AB for registration u/s.12A of the Act in the case of assessee Trust has been extended up-to 30.09.2023 after considering the genuine hardship faced by charitable institutions vide various CBDT circulars and finally, vide Circular No.6/2023 dated 24.05.2023. Similarly, the timeline prescribed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l/recognition/registration under clause (iii) of first proviso to section 80G of the Act also. Hence, we accept the plea of assessee and agree with the arguments of ld. counsel for the assessee and remand the matter back to the file of the CIT(Exemption) to decide the issue on merits. Hence, the order of CIT(Exemption) on this issue is set aside and matter is remanded back to the file of the CIT(Exemption) for re-deciding the issue on merits as per law. The appeal of the assessee is allowed for statistical purposes. 9. Now coming to the instant facts, we observe that the assessee had filed Form 10AB for grant of final registration under Section 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 under Section 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 under Section 80G (5) of the Act, on merits, as per law. 10. In the result, the appeal of the assessee is allowed for statistical purposes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ocial Welfare vs. CIT(E) 160 taxmann.com 624 (Kolkata Tribunal), the Tribunal has held that where assessee had been granted provisional approval under clause (iv) to first to section 80G(5), application nor final approval under clause (iii) to first proviso to section 80G(5) could not be rejected on ground that institution had already commenced its activities even prior to grant of provisional registration. 12. Further, we also observe that recently vide Circular No. 7/2024 dated 25.04.2024 CBDT has further extended the due date of filing Form No. 10A/10AB under the Income Tax Act till 30.06.2024, taking into consideration the difficulties reiterated by tax payers electronic filing of 10A/10AB. It would be useful to reproduce the Circular for ready reference:- Circular No. 7/2024 F. No. 173/25/2024-ITA-I Government of India Ministry of Finance Department of Revenue Central Board of Direct Taxes New Delhi, Dated 25th April, 2024 Sub: Extension of due date for filing of Form No. 10A/10AB under the Income-tax Act, 1961-reg. On consideration of difficulties reported by the taxpayers and other stakeholders in the electronic filing of Form No. 10A/10AB, the Central Board of Direct Taxes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... treated as a valid application. 4.1 Further, in cases where any trust, institution or fund has already made an application in Form No. 10AB, and where the Principal Commissioner or Commissioner has passed an order rejecting such application, on or before the issuance of this Circular, solely on account of the fact that the application was furnished after the due date or that the application has been furnished under the wrong section code, it may furnish a fresh application in Form No. 10AB within the extended time provided in paragraph 3(ii) i.e. 30.06.2024. 5. It is also clarified that if any existing trust, institution or fund who had failed to file Form No. 10A for A Y 2022-23 within the due date as extended by the CBDT circular no. 6/2023 dated 24.05.2023 and subsequently, applied for provisional registration as a new trust, institution or fund and has received Form No. 10AC, it can avail the option to surrender the said Form No. 10AC and apply for registration for A Y 2022-23 as an existing trust, institution or fund in Form No. 10A within the extended time provided in paragraph 3(i) i.e. 30.06.2024. 13. Accordingly, since in the instant facts, as it evident from the various d ..... X X X X Extracts X X X X X X X X Extracts X X X X
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