MY ECOSOCIAL PLANET FOUNDATION,PUNE V. CIT EXEMPTION, PUNE

ITA 2793/PUN/2024

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The case involves My Ecosocial Planet Foundation, which appealed against the decisions of the Commissioner of Income Tax (Exemptions), Pune, rejecting their applications for registration under section 12A and approval under section 80G of the Income Tax Act, 1961. The primary contention was the incorrect section code used in the application form, which was deemed a hyper-technical ground for rejection. The Tribunal noted a similar precedent in the case of U V Patel Foundation, where it was decided to set aside the matter and remand it back for fresh consideration under the correct section code. The Tribunal directed the CIT(E) to either rectify the application or allow the filing of a new application, ensuring the assessee is given a fair opportunity to present their case.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 711531 (ITAT-PUNE)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-07-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Assessment Year: misc
• Other Referred Cases: U V Patel Foundation (ITA No. 1956/PUN/2024, dated 01.12.2024)
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AMOL KHAIRNAR
• Assessee Lawyers: SHARAD A VAZE
• Keywords: Set aside; Charitable institution
• Section: 11; 12A; 80G

Judgement Text

" आयकर अपीलीय अधिकरण “ए” न्यायपीठ पुणे में । IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, PUNE BEFORE SHRI R.K. PANDA, VICE PRESIDENT AND MS. ASTHA CHANDRA, JUDICIAL MEMBER आयकर अपील सं. / ITA Nos. 2793 & 2794/PUN/2024 My Ecosocial Planet Foundation, H-264, Sant Kripa N.I.A.S.O. Baner, Pune-411045 PAN : AANCM4076G Vs. CIT (Exemptions), Pune अपीलार्थी / Appellant प्रत्यर्थी / Respondent Assessee by : Shri Sharad A Vaze Department by : Shri Amol Khairnar Date of hearing : 17-07-2025 Date of Pronouncement : 25-07-2025 आदेश / ORDER PER ASTHA CHANDRA, JM : The above two appeals filed by the assessee are directed against the separate orders both dated 17.10.2024 of the Ld. Commissioner of Income Tax (Exemption), Pune (“CIT(E)”) rejecting the application(s) for grant of registration u/s 12A and approval u/s 80G of the Income Tax Act, 1961 (the “Act”). For the sake of convenience, both these appeals were heard together and are being disposed of by this common order. 2. In ITA No.2793/PUN/2024, the assessee has challenged the order of the Ld. CIT (E) in rejecting the application for registration u/s 12A of the Act while ITA No.2794/PUN/2024 relates to the order of the Ld. CIT(E) in denying the approval u/s 80G of the Act. 3. Facts of the case in ITA No.2793/PUN/2024, in brief, are that the assessee filed an application in Form No.10AB on 08.04.2024 for registration of the trust u/s 12A(1)(ac)(vi)-ITEM(B) of the Act. With a view to verify the genuineness of the activities of the assessee and compliance to requirements of any other law for the time being in force by the trust/ Printed from counselvise.com 2 ITA Nos.2793 & 2794/PUN/2024 institution as are material for the purpose of achieving its objects, a notice was issued through ITBA portal on 04.06.2024 requesting the assessee to upload certain information/clarification. The assessee was asked to file compliance by 20.06.2024. In response thereto, the assessee filed the requisite details. The Ld. CIT(E) while going through those details and documents filed along with the application, found various discrepancies for which he issued another notice on 03.10.2024. The said discrepancies recorded by the Ld. CIT(E) in para 4 of the impugned order is reproduced below: “4. … \"(i) Kindly furnish evidences claiming expenses on charitable activities such as bills/vouchers/invoices alongwith photographs of charitable activities carried out by your trust. (ii) As per financial statements and ITRs furnished by you, it is seen that the trust has claimed deduction u/s 11. Therefore, said provisions of sec. 12A(1)(ac) (vi)(B) of the Act are not applicable to your case. Please clarify with supporting documents. (iii) You were specifically requested to furnish year-wise list of all donations received (including corpus donations etc.) during the last 3 years / since inception, whichever is later viz. name of donor, address of donor, amount of donation, mode of donation / receipts etc. PAN nos. vide initial notice. You have not furnished the details as required in above format. Please furnish the same. (iv) Kindly furnish details of expenses made on the object alongwith schedules (Environment sustainability) alongwith credible evidences such bills / vouchers etc.\" 3.1 The assessee furnished its reply to the above notice on 10.10.2024, however, the said reply was not found to be complete and satisfactory by the Ld. CIT(E). The Ld. CIT(E) rejected the application of the assessee for grant of registration u/s 12A of the Act on account of selection of wrong section code by the assessee by observing as under: “6. The assessee has filed the present application u/s 12A(1)(ac) (vi)-ITEM 'B' of the Income-tax Act, 1961. The extract of the said provision is reproduced herewith for ready reference: \"12A(1)(ac)(vi) in any other case, where activities of the trust or institution have- (A) .....; (B) commenced and no income or part thereof of the said trust or institution has been excluded from the total income on account of applicability of sub-clause (iv) or sub-clause (v) or sub-clause (vi) or Printed from counselvise.com 3 ITA Nos.2793 & 2794/PUN/2024 sub-clause (via) of clause (23C) of section 10, or section 11 or section 12, for any previous year ending on or before the date of such application, at any time after the commencement of such activities,\" 6.1 It can be thus seen that the provisions of said section applies to a case where activities of the trust or institution have 'commenced and no income or part thereof of the said trust or institution has been excluded from the total income on account of applicability of sub-clause (iv) or sub-clause (v) or sub- clause (vi) or sub-clause (via) of clause (23C) of section 10, or section 11 or section 12, for any previous year ending on or before the date of such application, at any time after the commencement of such activities.' In the light of said provision, the submission of the assessee trust has been verified. It is noticed that as per financial statements, the trust has claimed deduction u/s 11 in earlier years. It has claimed deduction u/s 11 of the Act amounting to Rs. 7.77 Lakhs and Rs.7.56 Lakhs for the AYs 2023-24 and 2024-25 respectively. Thus, the assessee's income pertaining to previous years has been excluded from the total income on account of applicability of section 11 which occurs after the commencement of such activities. 7. Considering the above, and since the assessee's activities were already commenced at the time of filing the present application and it has claimed deduction under section 11 for previous year before the date of the present application, the assessee trust is not eligible to file application u/s 12A(1)(ac) (vi)-ITEM 'B' of the Income-tax Act, 1961. 8. In view of the above, the application under section 12A(1)(ac)(vi)-ITEM(B) of the Income Tax Act, 1961 filed on 08/04/2024 by the assessee is hereby rejected.” 4. Aggrieved with such order of the Ld. CIT(E), the assessee is in appeal before the Tribunal by raising the following grounds: “1. On the basis of facts and in the circumstances of the case and as per law, the Commissioner of Income Tax, (Exemptions) Pune, is not justified in rejecting the regular registration even after the submission of information called from the assessee-trust The rejection is only on the hyper-technical ground of wrong section code inadvertently /mistakenly used by the assessee in Form 10AB. The Commissioner of Income Tax (Exemptions) Pune be directed to consider Form 10AB filed on xx/xx/xxxx as having been filed under Clause (iii) of sec 12A(1)(ac), by condoning the delay / limitation, if any. 2. The appellant craves leave to add, alter, omit or substitute any of the grounds at the time of hearing of the appeal. 5. Admittedly, the facts of the case in ITA No.2794/PUN/2024 are similar to that of ITA No.2793/PUN/2024 narrated above. Similar grounds have been raised in ITA No. 2794/PUN/2024 which read as under: “1. On the basis of facts and in the circumstances of the case and as per law, the Commissioner of Income Tax, (Exemptions) Pune, is not justified in rejecting the regular registration even after the submission Printed from counselvise.com 4 ITA Nos.2793 & 2794/PUN/2024 of information called from the assessee-trust The rejection is only on the hyper-technical ground of wrong section code inadvertently /mistakenly used by the assessee in Form 10AB. The Commissioner of Income Tax (Exemptions) Pune be directed to consider Form 10AB filed on xx/xx/xxxx as having been filed under Clause (iii) of sec 12A(1)(ac), by condoning the delay / limitation, if any. 2. The appellant craves leave to add, alter, omit or substitute any of the grounds at the time of hearing of the appeal. 6. It is the submission of the Ld. AR that since the Ld. CIT(E) has rejected the grant of registration u/s 12A of the Act and cancelled the provisional registration granted earlier, he refused to grant approval u/s 80G of the Act. 7. The Ld. Counsel for the assessee at the outset submitted that the application filed for grant of registration u/s 12A and approval u/s 80G of the Act was rejected by the Ld. CIT(E) solely on the ground that the assessee has used wrong section code while e-filing of Form 10AB. This mistake has happened inadvertently by the assessee and the same is not fatal denying the registration/approval of a charitable trust. In support of his contention, he placed reliance on the decision of Pune Tribunal in the case of U V Patel Foundation (ITA No. 1956/PUN/2024, dated 01.12.2024) wherein the Tribunal under the similar set of facts has set aside the matter to the file of the Ld. CIT(E) to decide the assessee’s application afresh considering the same as filed by the assessee under the correct section code. He therefore requested that the order of the Ld. CIT(E) may be set aside with a direction to treat decide the matter afresh after affording an opportunity of hearing to the assessee. 8. The Ld. DR, on the other hand, supported the order of the Ld. CIT(E). He, however, brought to our attention that there is a technical difficulty on the part of the Ld. CIT(E) to treat and dispose off the assessee’s application as filed under the correct section code as per the directions of the Tribunal and hence the assessee may be directed to file the fresh application with the correct clause. Printed from counselvise.com 5 ITA Nos.2793 & 2794/PUN/2024 9. We have heard Ld. Representatives of the parties, perused the paper book filed by the Ld. AR on behalf of the assessee as well as judicial precedents relied upon by the Ld. AR. It is an admitted fact that the assessee filed its response to notices issued by the Ld. CIT(E), however, the same were not found to be of his satisfaction. He rejected the application of the assessee u/s 12A for the reason of selection of wrong section code by the assessee in its application for regular registration. The assessee’s application for grant of approval u/s 80G has also been rejected by the Ld. CIT(E) on the similar ground along with the reason that the application for grant of registration u/s 12A of the Act has also been rejected. We find that the Coordinate Bench of the Pune Tribunal in the case of U V Patel Foundation (supra) relied by the Ld. AR, has set aside the matter to the file of the Ld. CIT(E) with a direction to decide the application of the assessee afresh considering the same as filed by the assessee under the correct section code. It is however worthwhile to note the concern of the Ld. DR that there are certain technical difficulties faced by the Ld. CIT(E) in treating and disposing off the assessee’s application as filed under the correct section code. 10. Considering the totality of the facts and in the circumstances of the case and legal position enumerated above, we deem it fit and proper, to set aside the impugned order(s) of the Ld. CIT(E) and restore the issue(s) to his file with a direction to treat both the applications for registration under section 12A and approval under section 80G of the Act as filed under the correct section code and decide them afresh as per fact and law after granting reasonable opportunity of hearing to the assessee. Having said so, in the light of the above concern of the Ld. DR, we also direct that the Ld. CIT(E) shall give an opportunity to the assessee to file the correct application(s) if needed and condone the delay/limitation, if any in filing of the fresh application(s) or give an opportunity to rectify the application and then decide the same on merits denovo. The assessee is also hereby directed to remain vigilant and make his submissions on the appointed date without seeking any adjournment under any pretext unless required for the sufficient cause, failing which the Ld. CIT(E) shall be at liberty to pass appropriate order(s) as per law. We hold and direct accordingly. The Printed from counselvise.com 6 ITA Nos.2793 & 2794/PUN/2024 grounds raised by the assessee in both the appeals are accordingly allowed for statistical purposes. 11. In the result, both the appeals in ITA Nos.2793 & 2794/PUN/2024 filed by the assessee are allowed for statistical purposes. Order pronounced in the open court on 25th July, 2025. Sd/- Sd/- (R.K. Panda) (Astha Chandra) VICE PRESIDENT JUDICIAL MEMBER पुणे / Pune; दिन ांक / Dated : 25th July, 2025. रदि आदेश की प्रधिधलधप अग्रेधिि / Copy of the Order forwarded to : 1. अपील र्थी / The Appellant. 2. प्रत्यर्थी / The Respondent. 3. The Pr. CIT concerned. 4. दिभ गीय प्रदिदनदि, आयकर अपीलीय अदिकरण, “ए” बेंच, पुणे / DR, ITAT, “A” Bench, Pune. 5. ग र्ड फ़ इल / Guard File. //सत्य दपि प्रदि// True Copy// आिेश नुस र / BY ORDER, िररष्ठ दनजी सदचि / Sr. Private Secretary आयकर अपीलीय अदिकरण ,पुणे / ITAT, Pune Printed from counselvise.com "