ELIM CHURH EDUCATIONAL CENTRE RELIGIOUS AND CHARITABLE TRUST,MADURAI V. CIT(EXEMPTIONS), CHENNAI

ITA 2813/CHNY/2024

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The case involves the Elim Church Education Centre, a religious and charitable trust, which appealed against the decision of the CIT (Exemptions), Chennai, rejecting their application for renewal of registration under section 12AB of the Income Tax Act. The rejection was due to an inadvertent error where the trust applied under sub-clause (vi) instead of the required sub-clause (iii) of section 12A(1)(ac) of the Act. The tribunal, referencing several Supreme Court decisions, emphasized that procedural errors should not defeat substantive rights, especially when such errors are curable. Consequently, the tribunal directed the CIT (Exemptions) to rectify the clerical mistake and process the application for renewal.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 106997 (ITAT-CHENNAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-03-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2024-2025
• Other Referred Cases: United Bank of India v. Naresh Kumar, Associated Journals Ltd. v. Mysore Paper Mills Ltd., Owners & Parties interested in MV Vali Pero v. Fernandeo Lopez
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NILAY BARAN SOM
• Assessee Lawyers: R. SRIDEVI
• Keywords: Charitable institution; Procedural lapse

Judgement Text

"आयकर अपीलीय अिधकरण, ‘ए’ \u0001यायपीठ, चे\tई। IN THE INCOME TAX APPELLATE TRIBUNAL ‘A’ BENCH: CHENNAI \u0001ी एबी टी. वक , \u000bाियक सद\u0011 एवं एवं एवं एवं \u0001ी मनोज क ुमार अ\u0019वाल, लेखा सद\u0007 क े सम\u001d BEFORE SHRI ABY T. VARKEY, JUDICIAL MEMBER AND SHRI MANOJ KUMAR AGGARWAL, ACCOUNTANT MEMBER आयकर अपील सं./ITA No.2813/Chny/2024 िनधा\u000eरण वष\u000e/Assessment Year: 2024-25 Elim Church Education Centre – Religious & Charitable Trust, 3-1/1, Appathurai Nagar, 1st Street, Madurai-625 018. v. The CIT (Exemptions), Chennai. [PAN:AABTE 0787 D] (अपीलाथ\u0016/Appellant) (\u0017\u0018यथ\u0016/Respondent) अपीलाथ\u0016 क\u001a ओर से/ Appellant by : Ms.R. Sridevi, CA \u0017\u0018यथ\u0016 क\u001a ओर से /Respondent by : Mr.Nilay Baran Som, CIT सुनवाईक\u001aतारीख/Date of Hearing : 29.01.2025 घोषणाक\u001aतारीख /Date of Pronouncement : 19.03.2025 आदेश / O R D E R PER ABY T. VARKEY, JM: This is an appeal preferred by the assessee Trust against the order of the Learned Commissioner of Income Tax (Exemptions)/NFAC, (hereinafter referred to as “the Ld.CIT(E)”), Chennai, dated 16.07.2024 rejecting the application filed by the assessee online dated 26.01.2024 in Form No.10AB ITA No.2813/Chny/2024 (AY 2024-25) Elim Church Education Centre Religious & Charitable Trust :: 2 :: u/s.12A(1)(ac)(vi)(b) of the Income Tax Act, 1961 (hereinafter referred to as \"the Act”) seeking registration u/s.12AB of the Act. 2. At the outset, the Ld. Counsel for the assessee submitted that there is a delay of ‘36’ days in filing of this appeal and submitted the reasons for delay. Since we note from the explanation given by the assessee that assessee was prevented by sufficient cause, we condone the delay of ‘36’ days and proceed to adjudicate the appeal on merits. 3. At the outset, the Ld.AR of the assessee draw our attention to the fact that the assessee Trust was formed in the year 2021 and applied for provisional registration u/s.12AB of the Act which was granted on 27.05.2021 from AYs 2021-22 to AY 2023-24 [for three years] as per section 12A(1)(ac)(vi) of the Act. Further, the Ld.AR pointed out that the assessee while applying for renewal of the registration u/s.12AB of the Act inadvertently clicked sub-clause (vi) instead of sub-clause (iii) of section 12A(1)(ac), because of which, the Ld.CIT(E) has rejected the application filed online dated 26.01.2024. Therefore, she prays that inadvertent mistake should not come in the way of the assessee to get the registration u/s.12AB of the Act. ITA No.2813/Chny/2024 (AY 2024-25) Elim Church Education Centre Religious & Charitable Trust :: 3 :: 4. Per contra, the Ld.DR couldn’t controvert the aforesaid facts. However, he doesn’t want us to interfere with the order of the Ld.CIT(E). 5. Having heard both the parties, we find that assessee Trust was formed in 2021 and granted provisional registration u/s.12AB of the Act on 27.05.2021 for three years from AYs 2021-22 to 2023-24; and as per the scheme of the Act, the assessee in order to renew its registration u/s 12AB, had to file application under sub-clause (iii) of clause (ac) of sub-section (1) of section 12A, but assessee inadvertently filed/clicked online sub-clause (vi) of clause (ac) of sub-section (1) of section 12A. Therefore, the Ld.CIT(E) has rejected the application filed by the assessee dated 26.01.2024 by passing the impugned order rejecting the same. The impugned action of the Ld.CIT(E) can’t be countenanced. In this context, we take note of the Hon’ble Supreme Court decision in the case of United Bank of India v. Naresh Kumar AIR 1997 SC 3, wherein, it was observed by their Lordships “as far as possible, a substantive right should not be defeated on account of a procedural irregularity which is curable” and in the case of Associated Journals Ltd. v. ITA No.2813/Chny/2024 (AY 2024-25) Elim Church Education Centre Religious & Charitable Trust :: 4 :: Mysore Paper Mills Ltd., reported in [2006] 69 SCL 311 (SC), it was observed by the Hon’ble Supreme Court - “… Rules of procedure cannot be a tool to circumvent the justice. In fact, the Rules are laid to help for speedy justice … Technical defects in petition are curable…..”. 6. In Owners & Parties interested in MV Vali Perov. Fernandeo Lopez AIR 1989 SC 2206, it was observed “Rules of procedure are not by themselves an end, but means to achieve the ends of justice. Rules of procedure are tools forged to achieve justice and are not hurdles to obstruct the pathway to justice. Construction of a rule of procedure which promotes justice and prevents its miscarriage by enabling the Court to do justice in myriad situations, all of which can’t be envisaged, acting within the limits of permissible construction, must be preferred to that which is rigid and negatives the cause of justice. Procedure is meant to sub-serve and not rule the cause of justice”. 7. In the light of the aforesaid decisions of the Hon’ble Supreme Court, we are of the view that the inadvertent mistake made by the assessee while clicking the online portal i.e. clicking sub-clause (vi) instead of sub-clause (iii) should not have resulted in rejection of the application filed by the assessee for renewal of registration ITA No.2813/Chny/2024 (AY 2024-25) Elim Church Education Centre Religious & Charitable Trust :: 5 :: u/s.12AB of the Act. Therefore, we direct the Ld.CIT(E) to treat the application filed by the assessee Trust as if it has been filed under clause (iii) instead of clause (vi) and process the application for renewal u/s.12AB in accordance to law and the assessee is directed to file all the required documents to prove the genuineness of its activities as prescribed u/s.12AB(1)(b)(i) and the Ld.CIT(E) to pass order under sub-clause (ii) of section 12AB(1)(b) of the Act, after hearing the assessee. 8. In the result, appeal filed by the assessee is allowed for statistical purposes. Order pronounced on the 19th day of March, 2025, in Chennai. Sd/- (मनोज क ुमार अ\u0019वाल) (MANOJ KUMAR AGGARWAL) लेखा सद\u0003य/ACCOUNTANT MEMBER Sd/- (एबी टी. वक ) (ABY T. VARKEY) \u0005याियक सद\u0003य/JUDICIAL MEMBER चे\tई/Chennai, \u001fदनांक/Dated: 19th March, 2025. TLN आदेश क\u001a \u0017ितिलिप अ\"ेिषत/Copy to: 1. अपीलाथ\f/Appellant 2. \r\u000eथ\f/Respondent 3. आयकरआयु\u0014/CIT, Chennai / Madurai / Salem / Coimbatore. 4. िवभागीय\rितिनिध/DR 5. गाड\u001dफाईल/GF "