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TMI Blog2024 (1) TMI 1448X X X X Extracts X X X X X X X X Extracts X X X X ..... was filed beyond the limitation period prescribed under the Act and also extended period of limitation granted by CBDT by various circulars issued from time to time. Thus denying registration u/s. 80G(5) of the Act and also cancelling provisional registration granted on 13.05.2022 to the assessee. 3. Aggrieved against the rejection order, the assessee is in appeal before us raising the following Grounds of Appeal: 1. On the facts and in circumstances of the case as well as law, the ld. CIT(Exemption) has erred in rejecting assessee's application u/s. 80G(5) filed on 23.02.2023 on the ground that assessee didn't file the application before 30.09.2022 when the assessee has filed the application in time as per the extension granted till 30.09.2023 as per circular no. 6/2023 dated 29.05.2023. 2. Even otherwise, the ld. CIT(Exemption) has erred in rejecting application u/s. 80G(5) filed on 23.02.2023 when the assessee was under honest belief that extension was granted till 30.09.2023 as per circular no. 6/2023 dated 29.05.2023. 3. It is therefore prayed that the CIT(Exemption) should be directed passed u/s. 80G(5) of the I.T. Act, 1961 may please be set aside to the fil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n u/s. 80G was granted on 13-05-2022. However, the assessee failed to file final registration under 80G(5) within six months period. On an identical issues, Co-ordinate Bench of this Tribunal in the case of Best Buds Pet Care (cited supra) held as follows: "...6.1 For better understanding, section 80G(5)(3) of the Act reads as follows:- "(iii) 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;" 6.2 Reading of the above sub-section makes it clear that there is no provision to condone the delay in Registration of the Trust. However, the CBDT has extended the above time limits by invoking section 119 of the Act by issuing circular No. 8 of 2022, dated 31-032022 extending the time limit upto 30th September, 2022. It is thereafter by circular No. 6 of 2023 dated 24-05-2023 clarified as follows:- "7. It may be also noted that the extension of due date as mentioned in paragraph 5(ii) shall also apply in case of all pending applications under clause (iii) of the first proviso to clause (23C) of section 10 or sub-c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e in the light of the applicable legal position. We note that in the latest Circular No.6/2023 dated 24.05.2023, the date was not extended by the CBDT, so far as, filing of Form No. 10AB, u/s 80G(5)(iii) of the Income Tax Act, 1961, is concerned. 14. We note that the extended period, as per Circular No.8/2022, as extended period declared by the Central Board of Direct Taxes (CBDT) is, on or before 30.09.2022, which has also expired, in the assessee`s case under consideration. However, after this Circular No.8/2022, the CBDT has issued another Circular No.6/2023 dated 24.05.2023 wherein in para-5, the CBDT has instructed as follows: "5. In order to mitigate genuine hardship in such cases, the Board, in the exercise of the power under section 119 of the Act, extends the due date of making an application in,- (i) Form No.10A, in case of an application under clause (i) of the first proviso to clause (23C) of section 10 or under sub-clause (i) of clause (ac) of sub-section (1) of section 12A or under clause (i) of the first proviso to sub-section (5) of section 80G of the Act, till 30.09.2023 where the due date for making such application has expired prior to such date; (ii) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 80G(5) of the Act. Besides, as per circular No.8/2022 of CBDT dated 31.03.2022, the extended time is up to 30.09.2022, however, the assessee filed Form No.10AB, u/s 80G(5) (iii) on 24.02.2023, therefore, application filed by the assessee before the ld CIT(E) is delayed by 147 days (approx.), and hence ld CIT(E) rejected application of assessee in Form No.10AB, u/s 80G(5) (iii) of the Act, as not maintainable and also cancelled the provisional approval granted in Form No.10AC, under clause (iv) of first proviso to subsection (5) of section 80 G of the Act. 17. Therefore, in this ambiguity situation in circular No.8/2022 of CBDT dated 31.03.2022 and latest Circular No.6/2023 dated 24.05.2023, of the CBDT, we do not have any option but to condone the delay in filing application in Form No.10AB, u/s 80G(5) of the Act. We note that Co-ordinate Bench of Jodhpur in the case of Bhamashah Sundarlal Daga Charitable Trust vs. CIT(Exemption) in ITA No.278/JODH/2023 dated 10.11.2023 dealt with the issue of clause-(iii) 3rd proviso u/s 80G(5) of the Act stating that "whichever is earlier" is applicable only to the newly constructed trust. The findings of the Co-ordinate Bench in the case of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... imes the completion of the sale may take place even a couple of years after the date of the agreement - the market price shoots up with the result that the market price prevailing on the date of the sale exceeds the agreed price at which the property is sold by more than 15 per cent of such agreed price. This is not at all an uncommon case in an economy of rising prices and in fact we would find in a large number of cases where the sale is completed more than a year or two after the date of the agreement that the market price prevailing on the date of the sale is very much more than the price at which the property is sold under the agreement. Can it be contended with any degree of fairness and justice that in such cases, where there is clearly no understatement of consideration in respect of the transfer and the transaction is perfectly honest and bona fide and, in fact, in fulfilment of a contractual obligation, the assessee who has sold the property should be liable to pay tax on capital gains which have not accrued or arisen to him. It would indeed be most harsh and inequitable to tax the assessee on income which has neither arisen to him nor is received by him, merely because h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t started charitable activities at the time of obtaining Provisional registration, and not for those trust/institutions which have already started charitable activities before obtaining Provisional Registration. We derive the strength from the Speech of Hon'ble Finance Minister and the Memorandum of Finance Bill 2020. 11.3 Therefore, in these facts and circumstances of the case, we hold that the Assessee Trust had applied for registration within the time allowed under the Act. Hence, the application of the assessee is valid and maintainable. 12. Even otherwise, the Provisional Approval is uptoA.Y.2025-26, and it can be cancelled by the ld.CIT(E) only on the specific violations by the assessee. However, in this case the ld.CIT(E) has not mentioned about any violation by the Assessee. Therefore, even on this ground the rejection is not sustainable. 13. However, the ld.CIT(E) has not discussed whether the Assessee fulfils all other conditions mentioned in the section as he rejected it on technical ground. Therefore, in these facts and circumstances we hold that the Assessee had made the application in form 10AB within the prescribed time limit and hence it is valid applicatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tribunal has, in an elaborate order in which all the facts and the rival submissions have been taken into consideration, held that there was sufficient cause for the delay on the part of the assessee-society in making the applications for registration under section 12A and 80G of the Act. It is not necessary, nor is it proper, for us to decide the culpability or otherwise of A.K. Sikri who was the Treasurer of the assessee-society. All that we need to examine is whether the Tribunal had valid materials before it on the basis of which it could have reasonably come to the conclusion that the assessee-society was prevented by sufficient cause in applying for the registration in time. It is manifest from a fair reading of the order of the Tribunal that it had weighed the circumstances in which the assessee-society was placed and the action it took immediately on receipt of the complaint from M.P. Mansinghka Trust of Mumbai; it has referred to the confession of Sikri in the meeting of the governing body owning up responsibility for having misled the assessee-society by representing that the necessary application for registration were made in time; it has also referred to the action take ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ies, and presumptions may supply gaps in the evidence which may not, on account of delay or the nature of the transactions or for other reasons, be supplied from independent sources. But the Tribunal cannot make arbitrary decisions: it cannot found its judgment on conjectures, surmises or speculation. Between the claims of the public revenue and of the taxpayers, the Tribunal must maintain a judicial balance." In Udhavdas Kewalram v. CIT [1967] 66 ITR 462 (SC) the very same Bench of three judges of the Supreme Court again observed as under: - "The Income-tax Appellate Tribunal performs a judicial function under the Indian Income-tax Act: it is invested with authority to determine finally all questions of fact. The Tribunal must, in deciding an appeal, consider with due care all the material facts and record its finding on all the contentions raised by the assessee and the Commissioner in the light of the evidence and the relevant law ......................................The Tribunal was undoubtedly competent to disagree with the view of the Appellate Assistant Commissioner. But in proceeding to do so, the Tribunal had to act judicially, i.e., to consider all the evidence in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... must be explained" does not mean that a pedantic approach should be made. Why not every hour's delay, every second's delay? The doctrine must be applied in a rational, common sense and pragmatic manner. 4. When substantial justice and technical considerations are pitted against each other, the cause of substantial justice deserves to be preferred, for the other side cannot claim to have vested right in injustice being done because of a nondeliberate delay. 5. There is no presumption that delay is occasioned deliberately, or on account of culpable negligence, or on account of mala fides. A litigant does not stand to benefit by resorting to delay. In fact, he runs a serious risk. 6. It must be grasped that the judiciary is respected not on account of its power to legalize injustice on technical grounds but because it is capable of removing injustice and is expected to do so." 23. In N. Balakrishnan v. M. Krishnamurthy [1998] 7 SCC 123 the Supreme Court again reiterated the approach. In Ram Nath Sao v. Gobardhan Sao [2002] 3 SCC 195 it was observed by the Supreme Court that acceptance of the explanation furnished should be the rule and refu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was no evidence before them upon which they, as reasonable men, could come to the conclusion to which they have come: and this, even though the Court of Review would on the evidence have come to a conclusion entirely different from theirs." There is no need to further elaborate this position, because the law as laid down in these observations is well settled, and has been adopted in the construction of section 66 of the Act." 25. This view was reiterated by the Supreme Court in CIT v. Daulatram Rawatmull [1964] 53 ITR 574 where it was held that "if there is some evidence to support the finding recorded by the Tribunal, even if it appears to the High Court that on re-appreciation of the evidence, it might arrive at a conclusion different from that of the Tribunal" the High Court has no power to interfere with the findings of the Tribunal. These decisions were applied by a Division Bench of this Court in CIT v. Baba Avtar Singh[1972] 83 ITR 738 where it was observed as under: - "The submission made by Mr. Sharma does not appear to us to be correct. It is well-settled that the court cannot set aside the Tribunal's finding of fact if there is some evidence to support that ..... 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