MAHESHWARI JANKALYAN SANSTHAN,PUNE V. COMMISSIONER OF INCOME TAX (EXEMPTIONS), PUNE, PUNE

ITA 206/PUN/2025

AI Insights

The case involves Maheshwari Jankalyan Sansthan appealing against the rejection of their application for approval under section 80G of the Income Tax Act, 1961. The primary issue was the incorrect selection of the section code in Form 10AB, which led to the initial rejection of their application by the CIT (Exemptions). The Tribunal referenced a similar case, Shree Swaminarayan Gadi Trust Vadtal, where it was held that such inadvertent mistakes should not be considered fatal and the application should be considered on its merits. The Tribunal directed the CIT (Exemptions) to allow the appellant to rectify the mistake and to reconsider the application afresh.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 714619 (ITAT-PUNE)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-08-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Assessment Year: 2022-2023
• Other Referred Cases: Shree Swaminarayan Gadi Trust Vadtal (SVG) Vs. CIT (Exemptions), Ahmedabad
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AMOL KHAIRNAR
• Assessee Lawyers: NITIN RANDER
• Keywords: Opportunity of being heard; Reasonable cause; Principle of natural justice
• Section: 80G

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCHES “A”, PUNE BEFORE DR.MANISH BORAD, ACCOUNTANT MEMBER AND MS. ASTHA CHANDRA, JUDICIAL MEMBER आयकर अपील सं. / ITA No.206/PUN/2025 Assessment Year : 2022-23 Maheshwari Jankalyan Sansthan 1105, Mukund Bhavan, Raviwar Peth, Pune 411002 Maharashtra PAN: AAATM3859P Vs. CIT (Exemption), Pune Appellant Respondent आदेश / ORDER PER DR. MANISH BORAD, ACCOUNTANT MEMBER : The captioned appeal at the instance of appellant is against the rejection of application for approval u/s.80G of the Act respectively framed by ld.CIT(E) dated 28.11.2024. 2. Appellant has raised following grounds of appeal : “1. On the facts and in the circumstances of the case and in law, the Hon' Commissioner of Income Tax (Exemptions) has erred in rejecting appellant's application in Form 10AB for approval under section 80G of the Income Tax Act, 1961 on the ground that it is non- maintainable. 2. On the facts and in the circumstances of the case and in law, the Hon' Commissioner of Income Tax (Exemptions) was not justified in rejecting the application for approval under section 80G without granting a fair opportunity of being heard. The appellant prays that it should be allowed to present its case and submit the documents before the Hon' Commissioner of Income Tax (Exemptions). Appellant by : Shri Nitin Rander (through Virtual) Respondent by : Shri Amol Khairnar Date of hearing : 22.07.2025 Date of pronouncement : 04.08.2025 Printed from counselvise.com ITA No.206/PUN/2025 Maheshwari Jankalyan Sansthan 2 3. On the facts and in the circumstances of the case and in law, the Hon Commissioner of Income Tax (Exemptions) ought to have decided the matter of approval under section 80G on merits of the case after providing an opportunity to the appellant trust to rectify the mistake of selection of incorrect section code in Form 10AB. 4. On the facts and in the circumstances of the case and in law, the appellant prays that its inadvertent mistake of selection of incorrect section code in Form No. 10AB, namely selected code was 13-Clause (ii) of first proviso to sub-section (5) of section 80G' instead of '14-Clause (iii) of first proviso to sub-section (5) of section 80G' of the Act, may not be considered as fatal to decide its application for registration under section 80G and it may kindly be allowed to correct such mistake in the Form 10AB, which has been filed within the extended due date as notified in Circular No. 7/2024 dated 25.04.2024. 3. From perusal of the above grounds, we find the main grievance of the appellant in this appeal is selection of wrong section code pertaining to approval u/s.80G(5) of the Act. 4. We have heard the rival contentions and perused the record placed before. On perusal of the impugned order, we find that ld.CIT(E) has rejected the appellant’s application filed on Form 10AB for approval u/s.80G(5)(ii) on the ground of selecting the wrong section code observing as follows: “On verification of records and details furnished by you, it is seen that you have not furnished the copy of regular approval under section 80G(5)(vi) of the Income Tax Act, 1961. You have filed application under clause (ii) of first proviso to section 80G(5) of the Act. The provisions of said section are applicable to a trust or institution which is regularly approved under section 80G(5) (vi) of the Act. As per the provisions of Rule 11AA(2)(e) of the Income Tax Rules, 1962, the copy of existing order granting approval was required to be submitted along with the application itself. Therefore, the copy of order of regular approval under section 80G(5)(vi) of the Act in form No.10AC issued under the provisions of clause (i) or clause (iii) of first proviso to section 80G(5) of the Act was required to be submitted by you along with the application, itself. You were also specifically requested vide the notice dated 09/08/2024 to furnish copy of such approval. However, it is seen that the copy of such regular approval is neither submitted along with the application nor submitted during the present proceedings till date. The copy of order of approval available on record is a provisional approval under section 80G(5)(vi) of the Act and not a regular approval. Further, it is Printed from counselvise.com ITA No.206/PUN/2025 Maheshwari Jankalyan Sansthan 3 also seen from the records that you have not made any valid application for regular approval under section 80G(5) (vi) of the Act.\" 5. The compliance to the was due on 25/11/2024. The notice was duly served to the assessee through e-portal and e-mail. However, the assessee has not responded to the said notice till date. 6. It is also noticed from the data available on CPC 2.0 portal that the assessee is not approved under clause (i) or clause (iii) of first proviso to section 80G(5) of the Act hence the pre-requisite for approval under clause (ii) of first proviso to section 80G(5) is not fulfilled in this case. Therefore, prima-facie it appears that the assessee has inadvertently filed the present application. 7. In view of the above, the application filed by the assessee is treated as non-maintainable and hence, 'rejected' for statistical purposes and no adverse inference is drawn against the assessee.” 5. This issue is no more res integra by virtue of series of decisions by this Tribunal. We note that similar issue came up for adjudication before Coordinate Bench, Surat in the case of Shree Swaminarayan Gadi Trust Vadtal (SVG) Vs. CIT (Exemptions), Ahmedabad in ITA Nos. 369 & 370/Srt/2024, dated 13.05.2024 and the finding of the Tribunal reads as under : “5. We have considered the submissions of both the parties and perused the record carefully. There is no dispute that the appellant applied for registration under Section 12A/12AB of the Act under Form 10AB on 28.09.2023. The ld. CIT(E) while considering the application of appellant noted that the application filed by appellant is not maintainable and accordingly, a show cause notice dated 02/11/2023 was issued for seeking clarification. The appellant responded to the show cause notice of ld CIT(E) vide their reply dated 15.12.2023. The contents of show cause notice and the reply thereof is not recorded by ld CIT(E) in his order. We find that the appellant vide their reply dated 15/12/2023 prayed to consider the application in appropriate sub-clause of section 12A(1). The ld CIT(E) held that he has no power to change/ amend or rectify Form- 10AB. We find that it was an inadvertent mistake and the appellant has already explained the facts and prayed for correction before the ld. CIT(E). In our view the mistake in filing entry was not fatal and could be considered in appropriate sub-clause or clause of section 12A(1). Otherwise, the appellant has provided all the details and information in Form-10AB, while applying for registration under section 12A/12AB. Being first appellate authority, the plea of Printed from counselvise.com ITA No.206/PUN/2025 Maheshwari Jankalyan Sansthan 4 appellant for correction in Form-10AB is accepted and the order of ld CIT(E) is set-aside. The registry official of ld CIT(E) maintaining record of ITBA portal about the registration of trust under section 12A/12AB is directed either to correct such mistake or allow the appellant to rectify or amend the relevant clause/ sub-clause of section 12A(1). Considering the fact that the application of appellant was not considered on merit, therefore, we deem it appropriate to direct the ld. CIT(E) to treat the application of appellant under Section 12A(1)(ac)(iii) in place of Section 12A(1)(ac)(iv) of the Act and to consider the case on merit and pass the order in accordance with law. Needless to direct that before passing the order, the ld CIT(E) shall grant opportunity of hearing to the appellant. The appellant is also directed to furnish complete details to prove its object and activity and make all compliances as desired by the ld. CIT(E). In the result, the grounds of appeal raised by the appellant are allowed for statistical purposes only.” 6. In light of the above decision and having given our thoughtful consideration to the given facts and circumstances prevailing in the instant case, we are of the opinion that since ld. CIT(E) has himself has held that “the appeal is treated as non-maintainable and hence, ‘rejected’ for statistical purposes and no adverse inference is drawn against the assessee” it means that he has given the opportunity to file a revised application. Further we are of the view that wrong selection of section code/clause would not disentitle the appellant to its rightful claim. Selection of wrong code/clause by the appellant cannot be treated as fatal to the proceedings initiated after the filing of the application. We therefore in the interest of natural justice being fair to both the parties deem it appropriate to grant one more opportunity to the appellant, setting aside the impugned order to the file of ld. CIT(E). The ld.CIT(E) shall give an opportunity to the appellant to file the correct application and then decide the case on merits denovo after granting reasonable opportunity to the appellant. Appellant is also directed to remain vigilant and make satisfactory compliance to the notice(s) of hearing issued by Printed from counselvise.com ITA No.206/PUN/2025 Maheshwari Jankalyan Sansthan 5 ld.CIT(E). It should refrain from taking adjournments unless otherwise required for reasonable cause. Effective grounds of appeal raised by the appellant are allowed for statistical purposes. 7. In the result, the appeal of the appellant is allowed for statistical purposes. Order pronounced on this 04th day of August, 2025. Sd/- Sd/- (ASTHA CHANDRA) (MANISH BORAD) JUDICIAL MEMBER ACCOUNTANT MEMBER पुणे / Pune; \u0001दनांक / Dated : 04th August, 2025. Satish आदेश क\u0002 \u0003ितिलिप अ ेिषत / Copy of the Order forwarded to : 1. अपीलाथ / The Appellant. 2. \u000eयथ / The Respondent. 3. The Pr. CIT concerned. 4. िवभागीय ितिनिध, आयकर अपीलीय अिधकरण, “A” ब\u0014च, पुणे / DR, ITAT, “A” Bench, Pune. 5. गाड\u0004 फ़ाइल / Guard File. आदेशानुसार / BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलीय अिधकरण, पुणे / ITAT, Pune. Printed from counselvise.com "