CHEYUTHA FOR WELLBEING FOUNDATION,RANGA REDDY V. CIT (EXEMPTION), HYDERABAD

ITA 1227/HYD/2025

AI Insights

The case involves the Cheyutha for Wellbeing Foundation, a trust, which appealed against the decision of the Commissioner of Income Tax (Exemptions), Hyderabad, rejecting its application for regular registration under Section 80G of the Income-tax Act, 1961. The rejection was primarily based on the application being filed beyond the prescribed time limit. The Tribunal considered the circumstances of the delay and the substantive compliance of the trust with the requirements for registration under Section 80G, leading to the decision to allow the appeal for statistical purposes and remand the matter for reconsideration on merits.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 786088 (ITAT-HYDERABAD)
• Duration Of Justice: 3 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-10-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB-A
• Assessment Year: 2024-2025
• Appeal Filed On: 29-07-2025
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Opportunity of being heard; Principle of natural justice; Search and seizure; Charitable institution; Procedural lapse
• Section: 119(2)(b); 80G

Judgement Text

"आयकर अपीलȣय अͬधकरण, हैदराबाद पीठ IN THE INCOME TAX APPELLATE TRIBUNAL Hyderabad ‘A’ Bench, Hyderabad Įी रवीश सूद, माननीय ÛयाǓयक सदèय एवं Įी मधुसूदन सावͫडया, माननीय लेखा सदèय SHRI RAVISH SOOD, HON’BLE JUDICIAL MEMBER AND SHRI MADHUSUDAN SAWDIA HON’BLE ACCOUNTANT MEMBER आयकरअपीलसं./I.T.A. No.1227/Hyd/2025 (Ǔनधा[रणवष[/ Assessment Year: 2024-25) Cheyutha for Wellbeing Foundation, Ranga Reddy. PAN: AAKCC6489Q VS. Commissioner of Income Tax (Exemption), Hyderabad. (अपीलाथȸ/ Appellant) (Ĥ×यथȸ/ Respondent) करदाताकाĤǓतǓनͬध×व/ Assessee Represented by : Sri Anurag Sinha, Advocate राजèवकाĤǓतǓनͬध×व/ Department Represented by : Ms. U Mini Chandran, CIT-DR सुनवाईसमाÜतहोनेकȧǓतͬथ/ Date of Conclusion of Hearing : 27/10/2025 घोषणा कȧ तारȣख/ Date of Pronouncement : 31/10/2025 ORDER PER RAVISH SOOD, JM: The present appeal filed by the assessee trust is directed against the order passed by the Commissioner of Income Tax (Exemptions) [hereinafter referred to as “CIT(Exemptions)”], Hyderabad, dated 17.06.2025 rejecting its application filed in “Form No. 10AB” for regular registration under Section 80G(5) of the Income-tax Act, 1961 (for short, “the Act”). The assessee trust Printed from counselvise.com 2 ITA No. 1227/Hyd/2025 Cheyutha for Wellbeing Foundation vs. CIT (Exemption) has assailed the impugned order on the following grounds of appeal before us: “1. BECAUSE, the Ld. 'CIT' has erred in law as well as in the facts and circumstances of the case in arbitrarily rejecting the application filed by the 'appellant' seeking registration under section 80G of the 'Act'. 2. BECAUSE, the Ld. 'CIT' has erred in rejecting the application under Section 80G without issuing any notice requiring to offer explanation of delay in filing Form 10AB. Thus, the order is passed without giving opportunity in violation of the principles of natural justice. 3. BECAUSE, the Ld. 'CIT' erred in rejecting the application under Section 80G, while accepting the application under section 12A, accepting the reason given by the appellant for delayed filling the application and thereby condoning the delay ignoring that similar reason prevented the appellant from presenting application under Section 80G within the stipulated time. 4. BECAUSE, the Ld. 'CIT' failed to provide the Appellant with an adequate opportunity to present its case regarding 80G application separately from the 12AB application. The rejection without such an opportunity is a violation of the principles of natural justice. 5. BECAUSE, the Ld. 'CIT' had incorrectly rejected the application for 80G of the 'Act'. The Appellant has complied with all the substantive requirements for approval under Section 80G and that the rejection is based on a technical short coming which to is condonable rather than a substantive deficiency. 6. BECAUSE, appellant having been granted registration under section 12AB(1)(b) of the Act is entitled for registration/approval under section 80G of the 'Act'. The 'appellant' craves leave to add, alter OR vary the grounds of appeal before OR at the time of hearing. 2. Succinctly stated, the assessee trust was granted provisional registration under Section 80G of the Act by the Central Processing Centre (CPC) in “Form No. 10AC” dated 24/10/2022, valid for the period from AY 2023–24 to AY 2025–26. 3. The assessee trust had thereafter filed an application for regular registration under Section 80G of the Act in Form No. 10AB. During the course of the proceedings, the assessee trust had in response to notices Printed from counselvise.com 3 ITA No. 1227/Hyd/2025 Cheyutha for Wellbeing Foundation vs. CIT (Exemption) issued by the CIT(Exemptions), dated 27/03/2025 and 19.05.2025, vide its replies submitted the requisite details/information in response to the queries that were raised by him. 4. However, the CIT(Exemptions) rejected the aforesaid application vide his order dated 17.06.2025, on the ground that the assessee trust had failed to apply for regular registration within the prescribed time limit. It was observed by him that as per the amended provisions introduced by the Finance Act, 2020, an application in “Form No. 10AB” should be filed at least six months prior to the expiry of the provisional registration or within six months from the commencement of its activities, whichever is earlier. 5. The CIT(Exemptions) further observed that the CBDT vide Circular No. 7/2024 dated 25.04.2024 had extended the “due date” for filing Form No. 10A/10AB till 30.06.2024. It was observed by him, that as the assessee trust had filed its application in “Form 10AB” on 20/12/2024, therefore, it was time- barred. Accordingly, the CIT(Exemptions) rejected the application filed by the assessee trust for regular registration under Section 80G of the Act on the ground of the delay involved in filing the same. 6. Aggrieved, the assessee trust has carried the matter in appeal before us. 7. Sri Anurag Sinha, Advocate, Ld. Authorised Representative (for short, “AR”) for the assessee trust at the threshold of hearing, submitted that Printed from counselvise.com 4 ITA No. 1227/Hyd/2025 Cheyutha for Wellbeing Foundation vs. CIT (Exemption) the application filed by the assessee trust for regular registration under Section 80G has been rejected by the CIT (Exemption), Hyderabad for the reason that the same was filed beyond the prescribed time period. The Ld. AR submitted that though the CIT(Exemption) had accepted the explanation of the assessee trust regarding the delay in filing the application for regular registration under Section 12AB of the Act and granted the said registration, but he had most arbitrarily declined to condone the delay based on the same explanation insofar the application for regular registration under Section 80G(5) of the Act is concerned. The Ld. AR further submitted that as the delay in filing the application for regular registration was not inordinate and had crept in for justifiable reasons, therefore, the same in all fairness be condoned and the matter be restored to the file of the CIT(Exemption) for considering the same on merits. 8. Ms. U. Mini Chandran, Ld. CIT-DR supported the order of the CIT(Exemptions), and submitted that the time limit for filing an application for registration under section 80G of the Act, as prescribed under the law is mandatory in nature, and the CIT(Exemptions) has no discretion to condone the delay in filing of “Form 10AB”. 9. We have heard the Ld. Authorized Representatives of both parties and perused the material available on record. Printed from counselvise.com 5 ITA No. 1227/Hyd/2025 Cheyutha for Wellbeing Foundation vs. CIT (Exemption) 10. Admittedly, the assessee trust that was granted provisional registration under Section 80G of the Act had filed “Form 10AB” for regular registration on 20/12/2024. As observed by us hereinabove, the CBDT, vide Circular No. 7/2024 dated 25.04.2024, had extended the “due date” for filing such application till 30.06.2024, therefore, there can be no denying the fact that the application filed by the assessee trust was beyond the prescribed time limit. 11. Although the delay in filing the application for regular registration under Section 80G in “Form 10AB” is procedural in nature, but we are afraid that the provisions of the Act read along with the CBDT Circular No. 7/2024 (supra) are clear on the prescribed time limit in so far the filing of an application for regular registration in “Form 10AB” under Section 80G of the Act is concerned. However, we are at the same time of a firm conviction that procedural lapses should not be allowed to defeat the substantive rights, particularly in matters of charitable trusts seeking exemptions. Although there is no explicit provision under the Income-tax Act or rules for condonation of the delay in filing of “Form 10AB” for regular registration under Section 80G of the Act, but the assessee trust remains at liberty to approach the CBDT for condonation under Section 119(2)(b) of the Act. Thereafter, the CIT(Exemptions) is directed to take up and dispose of the application filed by the assessee trust for regular registration under Section 80G of the Act, on merits, in accordance with the extant law and after providing due opportunity of being heard to the assessee trust. Printed from counselvise.com 6 ITA No. 1227/Hyd/2025 Cheyutha for Wellbeing Foundation vs. CIT (Exemption) 12. Resultantly, the appeal of the assessee trust is allowed for statistical purposes in terms of our aforesaid observations. Order pronounced in the Open Court on 31ST October, 2025. S SdSd/- (मधुसूदन सावͫडया) (MADHUSUDAN SAWDIA) लेखासदèय/ACCOUNTANT MEMBER Sd/- SdSd/- (रवीश सूद) (RAVISH SOOD) ÛयाǓयकसदèय/JUDICIAL MEMBER d/- Sd Hyderabad, dated 31.10.2025. OKK/sps आदेशकȧĤǓतͧलͪपअĒेͪषत/ Copy of the order forwarded to:- 1. Ǔनधा[ǐरती/The Assessee : Cheyutha for Wellbeing Foundation, Flat No. 301, Way Side Residency, Tirumala Hills, Near Balaji Temple, Puppalaguda, Rangareddy, Hyderabad, Telangana-500089. 2. राजèव/ The Revenue : Commissioner of Income Tax (Exemption), Aayakar Bhawan, Opposite LB Stadium, Basheer Bagh, Hyderabad, Telangana-500004. 3. The Principal Commissioner of Income Tax, Hyderabad. 4. ͪवभागीयĤǓतǓनͬध, आयकरअपीलȣयअͬधकरण /DR,ITAT, Hyderabad. 5. The Commissioner of Income Tax 6. गाड[फ़ाईल / Guard file आदेशानुसार / BY ORDER Sr. Private Secretary ITAT, Hyderabad. Printed from counselvise.com "