RATLAM AHINSA SHIKSHA SAMITI,RATLAM V. COMMISSIONER OF INCOME TAX (EXEMPTION) , BHOPAL

ITA 719/IND/2024

AI Insights

The case involves Ratlam Ahinsa Shiksha Samiti, a society engaged in charitable educational activities, which sought final approval under section 80G(5) of the Income Tax Act, 1961, after initially receiving provisional approval. The CIT(Exemption) rejected the application on the grounds that the assessee did not meet the conditions of 'clause (iv)(B)' of the first proviso to section 80G(5). However, the Tribunal found that the correct application should have been under 'clause (iii)', applicable to institutions with provisional approval, and directed the CIT(Exemption) to reconsider the application under this clause.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 772109 (ITAT-INDORE)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-08-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Assessment Year: 2024-2025
• Other Referred Cases: Rambha Charitable Trust, Mumbai Vs. Commissioner of Income-tax, North Eastern Social Research Centre Vs. CIT(Exemption), Kolkata, Vivekananda Mission Asram vs. CIT, West Bengal Welfare Society vs. CIT(Exemption), Sri Aurobindo Bhawan Trust, Krishnagar vs. CIT(Exemption), Anudip Foundation for Social Welfare vs. CIT(Exemption), Kolkata
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Matter Remanded
• Court: TRIBUNAL
• Department Lawyers: FORASSESSEEATFIRSTCARRIEDUSTOTHERELEVANTPROVISIONOF; FORREVENUEINSISTEDTHATTHEASSESSEEFILED; FORREVENUEASTO; SHRIANOOPSINGH
• Assessee Lawyers: SHRIKAIDEKANGSAWALA
• Keywords: Set aside; Opportunity of being heard; Period of limitation; Charitable institution; Time period of passing order
• Section: 11; 12; 10; 80G

Judgement Text

"Page 1 of 16 आयकरअपीलीयअिधकरण, इंदौरɊायपीठ, इंदौर IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI B.M. BIYANI, ACCOUNTANT MEMBER AND SHRI PARESH M. JOSHI, JUDICIAL MEMBER ITA No. 719/Ind/2024 Ratlam Ahinsa Shiksha Samiti, 25, Dr. Radhakrishan Nagar, Sagod Road, Ratlam बनाम/ Vs. CIT(Exemption) Bhopal (Assessee/Appellant) (Revenue/Respondent) PAN: AACTR3146A Assessee by Shri Kaide Kangsawala, AR Revenue by Shri Anoop Singh, CIT-DR Date of Hearing 19.08.2025 Date of Pronouncement 25.08.2025 आदेश/ O R D E R Per B.M. Biyani, A.M.: Feeling aggrieved by order bearing DIN: ITBA/EXM/F/EXM45/2024- 25/1067064788(1) dated 26.07.2024 [“impugned order”] passed by learned Commissioner of Income-Tax (Exemption), Bhopal [“CIT(E)”] by which the assessee’s application dated 19.01.2024 for grant of final approval u/s Printed from counselvise.com Ratlam Ahinsa Shiksha Samiti ITA No. 719/Ind/2024 Page 2 of 16 80G(5) of Income-tax Act, 1961 has been rejected, the assessee has filed this appeal on following grounds: “1. The Hon'ble CIT(E) erred in law as well as on facts of the case in rejection under clause (iv)(B) of first proviso to section 80G(5) of the Income Tax Act, 1961 under the new provision of Income Tax Act, 1961. 2. The Hon'ble CIT(E) erred in law as well as on facts of the case that without given proper opportunity in rejection order passed under under clause (iv)(B) of first proviso to section 80G(5) of the Income Tax Act, 1961 under the new provision of Income Tax Act, 1961. 3. The Hon'ble CIT(E) erred in law as well as on facts of the case that genuine hardship if 80G registration in not Granted. 4. Your Appellant reserves the right to add, alter, amend and/or withdraw any of the above grounds of appeal.” 2. The background facts leading to present appeal are such that the assessee is a society registered under the M.P. Society Registration Act, 1973 w.e.f. 16.12.1999 and engaged in charitable activity of imparting education by running school approved by M.P. Board & CBSE. The assessee was having approval u/s 10(23C)(vi) of the Act granted by Income-tax Department vide order dated 19.03.2020 w.e.f. 01.04.2015. Subsequently due to change in provisions of law, the assessee has also been granted approval u/s 10(23C)(vi) vide order dated 10.03.2022 for AY 2022-23 to 2026-27. Apart from these approvals u/s 10(23C)(vi), the assessee was also granted provisional approval u/s 80G(5) by Income-tax Department vide order dated 27.12.2023 in Form No. 10AC for AY 2024-25 to 2026-27. Subsequently, vide application dated 19.01.2024 in Form No. 10AB, the Printed from counselvise.com Ratlam Ahinsa Shiksha Samiti ITA No. 719/Ind/2024 Page 3 of 16 assessee applied to Income-tax Department for conversion of provisional approval into final approval u/s 80G(5). However, vide impugned order, the CIT(E) has rejected assessee’s application. Aggrieved, the assessee has come in appeal before us. 3. Ld. AR for assessee at first carried us to the relevant provision of section 80G(5), as amended by Finance Act, 2023 w.e.f. 01.10.2023, existing as on 19.01.2024 when the assessee filed application in Form No. 10AB seeking final approval from CIT(E): \"80G(5) This section applies to donations to any institution or fund referred to in sub-clause (iv) of clause (a) of sub-section (2), only if it is established in India for a charitable purpose and if it fulfils the following conditions, namely:- XXX (vi) in relation to donations made after the 31st day of March, 1992, the institution or fund is for the time being approved by the Principal Commissioner or Commissioner; XXX Provided that the institution or fund referred to in clause (vi) shall make an application in the prescribed form and manner to the Principal Commissioner or Commissioner, for grant of approval,-- (i) where the institution or fund is approved under clause (vi) (as it stood immediately before its amendment by the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020), within three months from the 1st day of April, 2021; (ii) where the institution or fund is approved and the period of such approval is due to expire, at least six months prior to expiry of the said period; (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; Printed from counselvise.com Ratlam Ahinsa Shiksha Samiti ITA No. 719/Ind/2024 Page 4 of 16 (iv) in any other case, where activities of the institution or fund have – (A) not commenced, at least one month prior to the commencement of the previous year relevant to the assessment year from which the said approval is sought; (B) commenced and where no income or part thereof of the said institution or fund 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.” 4. Thereafter, Ld. AR carried us to the impugned order passed by Ld. CIT(E) reading as under: “2. The assessee has applied in Form 10AB for registration under clause- (iv)(B) of first proviso to section 80G(5) of the Act. Clause (iv)(B) of section 80G(5) of the Act is applicable only for those assessee whose activities are commenced and no exemption u/s 11/12 or 10(23C)(iv)/(v)/(vi)(via) has ever been claimed before filing of application in Form 10AB. On perusal of documents submitted by the assessee and data available on record, it is noticed that the assessee has already claimed exemption in its ITR for assessment year 2023-2024 before filling the present application. Hence, the assessee is not found eligible to file application under clause-(iv)(B) of first proviso to section 80G(5) of the Act. 3. Accordingly, a show cause notice was issued on 26.06.2024 to submit the clarification as under:- \"You have applied in Form 10AB for registration under clause-(iv)(B) of first proviso to section 80G(5) of the Act. Consequently, opportunity letter was issued and reply has been submitted by you during the proceedings. The relevant part of clause applicable from 01.10.2023-(iv) (B) of first proviso to section 80G(5) of the Act is as under- (vi) in any other case, where activities of the trust or institution have - 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 sub-clause (via) of clause (23C) or section 10, or section 11 or section 12, for any previous year ending on or before the date of such Printed from counselvise.com Ratlam Ahinsa Shiksha Samiti ITA No. 719/Ind/2024 Page 5 of 16 application, at any time after the commencement of such activities. It is clear that clause-(iv)(B) of first proviso to section 80G(5) of the Act is applicable only for those assessee whose activities are commenced and no exemption u/s 11/12 or 10(23C)(iv)/(v)/(vi)(via) has ever been claimed before filing of application in Form 10AB. On perusal of your reply and data available on record, it is noticed that you have already claimed exemption in your ITR for earlier years before filing the present application. Hence, you are not eligible to file application under clause-(iv)(B) of first proviso to section 80G(5) of the Act. Considering the facts of the case and reasons mentioned above, you are hereby required to show cause as to why the application filed in Form 10AB for grant of registration u/s 80G(5) of the Act should not be rejected.” 4. In response to show cause notice dated 26.06.2024, the assessee submitted \"With reference to above, you have brought to our notice the relevant part of clause applicable from 01.10.2023, clause (iv)(B) of first proviso to section 80G(5) of the Act. As the appellant has already claimed exemption in ITR for earlier years before filing the present application, it is not eligible to file application under the said clause. Sir, it is humbly brought on record that the amendment w.e.f. 01.10.2023 in clause (iv)(B) of the first proviso to section. 80G(5) has a major flaw that any institution earlier registered u/s 10(23C)(iv)/(v)/(vi) (via) or u/s 11 or 12 and who has commenced its activities and claimed exemption for any previous year ending on or before 31.03.2023 under the relevant provisions of the act can never get itself registered u/s 80G. Sir, many representations have been made by Tax Associations and other stakeholders before the Ministry of Finance and Central Board of Direct Taxes to suitably amend these harsh provisions so that the institutions genuinely working before the previous year 2023-24 and seeking registration u/s 80G cannot be deprived of the same. Sir, the matter is under consideration by Finance Ministry and CBDT there is high possibility of removal of this hardship in coming days particularly in the budget 2024 due to be presented in the third week of July 2024. Sir, we humbly request you to kindly adjourn the hearing of your show cause notice fixed on 04.07.2024 for at least three weeks and oblige.” The request of the assessee was duly accepted but no amendment as discussed in the reply of the assessee has been made by Ministry of Finance. The application has been filed under clause-(iv) (B) of first proviso to section 80G(5) of the Act, the assessee does not fulfill the conditions prescribed as per Income Tax Act, 1961. As per para 3, the application of registration u/s 80G(5) is hereby rejected on technical issue and merits of the case have not been examined.” [emphasis supplied] Printed from counselvise.com Ratlam Ahinsa Shiksha Samiti ITA No. 719/Ind/2024 Page 6 of 16 5. Thus, the CIT(E) has rejected assessee’s application on technical issue that the application was filed under “clause (iv)(B) of first proviso to section 80G(5) [clause (iv)(B)]” and the assessee did not satisfy the condition prescribed in such ‘clause (iv)(B)’ without examining merit of the case. But the Ld. AR submitted that the assessee has filed application selecting option of “clause (iv)(B)” and represented its case before CIT(E) accordingly due to a confusion/improper understanding of the new provisions of granting approvals recently introduced by Govt. through Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 w.e.f. 01.04.2021 [“TOLA”]. Ld. AR submitted that subsequent to introduction of those new provisions, the Govt. also realized certain weakness/confusions and had to amend and re-amend those new provisions from time to time through Finance Act, 2023 w.e.f. 01.10.2023 and Finance (No. 2) Act, 2024 w.e.f. 01.10.2024. Ld. AR submitted that as per the law of first proviso to section 80G(5) applicable on 19.01.2024 when the assessee filed application (such law is already re-produced in foregoing Para No. 3 of this order), the clause (i) was applicable to the institutions already approved u/s 80G before the new law i.e. TOLA came into force but the assessee was not having any approval prior to introduction of new law and it is first time when the assessee has sought approval u/s 80G(5), therefore clause (i) was not applicable. The clause (ii) would apply for renewal of approvals granted under new provisions, which again is not the case of assessee at present. Ld. AR submitted that the correct clause applicable to assessee was “clause (iii) of first proviso to section 80G(5) [“clause (iii)”]. Therefore, the present Printed from counselvise.com Ratlam Ahinsa Shiksha Samiti ITA No. 719/Ind/2024 Page 7 of 16 matter needs to be remanded to back to the file of CIT(E) for adjudication afresh with a direction that the assessee’s application be considered and decided in terms of “clause (iii)”. 6. Ld. AR relied upon following decisions of ITAT benches wherein the situations identical to assessee’s facts have been adjudicated: (a) ITAT Mumbai in Rambha Charitable Trust, Mumbai Vs. Commissioner of Income-tax, ITAT No. 5111/Mum/2024, order dated 29.11.2024: “6. The assessee in terms of the above provisions first applied for a provisional approval under sub-clause (B) of clause (iv) of first proviso to subsection (5) of section 80G within and subsequently (refer clause 2 in Form 10A) and was given the provisional registration up to AY 2025-26 on 30.11.2022. In the application for final approval in Form 10AB, it noticed that the assessee has once again mentioned same section i.e. sub-clause (B) of clause (iv) of first proviso to sub-section (5) of section 80G whereas the correct section code under which the assessee ought to have sought approval is clause (iii) of first proviso to sub-section (5) of section 80G. We also noticed that the CIT(E) has treated the application as one filed under sub-clause (B) of clause (iv) of first proviso to sub-section (5) of section 80G and accordingly rejected the application for not fulfilling the stipulated conditions prescribed for filing application for approval in Form 10AB. From the perusal of forms filed and the facts of the case, in our considered view, there is merit in claim of the Ld. AR that the assessee has selected the wrong section code inadvertently while filing the application for final registration in Form 10AB. Further, we notice that the assessee did not have the opportunity of being heard before CIT(E) due to incorrect course of action advised, and that otherwise the assessee might have explained the facts before the CIT(E) to avoid rejection. In view of these discussions and respectfully following the above decision of the Kolkata Bench in the case of North Eastern Social Research Centre (supra), we remit the issue back to CIT(E) with a direction to grant final approval to the assessee under Clause (iii) to First Proviso to section 80G(5) of the Act, if the assessee is otherwise found eligible. We also direct the CIT(E) to decide the application of the assessee for final approval as quickly as possible expiry of the provisional approval granted in order to enable the assessee to have the benefit of section 80G without any break. It is ordered accordingly. 7. In result the appeal of the assessee is allowed for statistical purposes.” Printed from counselvise.com Ratlam Ahinsa Shiksha Samiti ITA No. 719/Ind/2024 Page 8 of 16 (b) ITAT Kolkata in North Eastern Social Research Centre Vs. CIT(Exemption), Kolkata, ITA No. 741/Kol/2024, order dated 09.07.2024: “3. We have heard the rival submissions and gone through the record. Before proceeding further, it will be relevant to reproduce here the relevant provisions of section 80G(5) of the Act: \"80G(5) This section applies to donations to any institution or fund referred to in sub-clause (iv) of clause (a) of sub-section (2), only if it is established in India for a charitable purpose and if it fulfils the following conditions, namely:- XXX (vi) in relation to donations made after the 31st day of March, 1992, the institution or fund is for the time being approved by the Principal Commissioner or Commissioner; XXX Provided that the institution or fund referred to in clause (vi) shall make an application in the prescribed form and manner to the Principal Commissioner or Commissioner, for grant of approval,-- (i) where the institution or fund is approved under clause (vi) (as it stood immediately before its amendment by the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020), within three months from the 1st day of April, 2021; (ii) where the institution or fund is approved and the period of such approval is due to expire, at least six months prior to expiry of the said period; (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; (iv) in any other case, at least one month prior to commencement of the previous year relevant to the assessment year from which the said approval is sought: Provided further that the Principal Commissioner or Commissioner, on receipt of an application made under the first proviso, shall,-- Printed from counselvise.com Ratlam Ahinsa Shiksha Samiti ITA No. 719/Ind/2024 Page 9 of 16 (i) where the application is made under clause (i) of the said proviso, pass an order in writing granting it approval for a period of five years; (ii) where the application is made under clause (ii) or clause (iii) of the said proviso,-- (a) call for such documents or information from it or make such inquiries as he thinks necessary in order to satisfy himself about-- (A) the genuineness of activities of such institution or fund; and (B) the fulfilment of all the conditions laid down in clauses (i) to (v); (b) after satisfying himself about the genuineness of activities under item (A), and the fulfilment of all the conditions under item (B), of sub-clause (a), -- (A) pass an order in writing granting it approval for a period of five years; or\" XXX Provided also that the approval granted under the second proviso shall apply to an institution or fund, where the application is made under-- (a) clause (i) of the first proviso, from the assessment year from which approval was earlier granted to such institution or fund; (b) clause (iii) of the first proviso, from the first of the assessment years for which such institution or fund was provisionally approved; (c) in any other case, from the assessment year immediately following the financial year in which such application is made. 4. A perusal of the above provisions would reveal that the institutions which stood already approved u/s 80G(5)(vi) on the date of Amendment brought to section 80G of the Act by Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 have to re-apply for fresh registration under Clause (i) to the First Proviso to section 80G(5) of the Act and those institutions have to be granted approval for five years by the ld. CIT(Exemption) without any enquiry. The prescribed date for final application for approval under Clause (i) to the First Proviso to section 80G(5) of the Act was stipulated as three months from 1st Day of April 2022. However, the CBDT from time to time extended the date for filing of the said application under Clause (i) to the First Proviso to section 80G(5) of the Act and finally vide Circular No.6 of 2023 dated 24.05.2023, the said date was extended upto 30.09.2023. Further, the institutions which had to apply for the first time Printed from counselvise.com Ratlam Ahinsa Shiksha Samiti ITA No. 719/Ind/2024 Page 10 of 16 or the institutions which did not stand approved on the date of Amendment i.e. 01.04.2021 brought by the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020, they could apply under Clause (iv) of the First Proviso to section 80G(5) of the Act. In that case, the Ld. CIT(Exemption) is supposed to make necessary enquiries and if found satisfied regarding the genuineness of the activities of such an institution, would grant provisional approval for five years. Such institutes who have been granted provisional approval under clause (iv) to First Proviso to section 80G(5) of the Act, have to apply for final approval under Clause (iii) of First Proviso to section 80G(5). Such institutions are required to apply for final approval at least six months prior to expiry of the period of provisional approval or within six months of commencement of its activities, whichever is earlier. In the case in hand, provisional approval has also been granted to the assessee-institution from 28.06.2022 to A.Y 2025-26, therefore, the assessee- trust was entitled to apply for final approval and there was no bar to the institution for making such application. This issue has already been adjudicated upon by the Coordinate Bench of the Tribunal in the case of \"Vivekananda Mission Asram vs. CIT\" in ITA No. 995/Kol/2023 decided on 08.12.2023 (Judicial Member herein being the author of the said order) while deliberating upon the provisions of section 80G(5) of the Act, has held as under: \"6. So far as the observation of the ld. CIT(E) that the assessee had already commenced its activities since long and that as per Clause (iii) of 1st Proviso to section 80G(5) of the Act, the application for final registration was to be filed within six months from the commencement of its activities and therefore, the application of the assessee for final registration was time-barred, is concerned, we note that the issue has already been discussed and adjudicated by the Coordinate Bench of the Tribunal in the case of West Bengal Welfare Society vs. CIT(Exemption), Kolkata vide order dated 13.09.23 [one of us i.e. the Judicial Member herein, being the author of the said order], wherein, it has been held that the assessee, who has been granted provisional registration, is eligible to apply for final registration irrespective of the fact that the assessee had already commenced its activity even prior to the date of grant of provisional approval. The relevant part of the order of the Coordinate Bench is reproduced as under: 6. We note that the ld. CIT(E) has misconstrued the aforesaid proviso to section 80G(5) of the Act. As per the provision, an application for final registration cannot be filed until and unless an assessee/trust has been given provisional approval u/s 80G(5)(iv) of the Act. The assessee was granted provisional approval on 30.11.2022 only, and within a few days i.e. on 03.12.2022, the assessee applied for final registration u/s Clause (iii) of 1st Proviso to section 80G(5) of the Act. Though the assessee might have commenced its activities prior to grant of provisional registration but that does not mean that the assessee in that event will be precluded from applying for final registration even after the grant of provisional registration. The assessee as per statutory provision could not have directly applied for final Printed from counselvise.com Ratlam Ahinsa Shiksha Samiti ITA No. 719/Ind/2024 Page 11 of 16 registration without grant of provisional registration. The aforesaid proviso, therefore, is to be read as that after the grant of provisional registration, if the assessee has not commenced its activities, he may apply for registration within six months of the commencement of its activities or within the six months prior to the expiry of the period of provisional approval, whichever is earlier. In any case, the assessee is eligible to apply for final registration only after the grant of provisional approval. Therefore, we hold that there is no delay on the part of the assessee in filing application in the prescribed form for grant of final registration under Clause (iii) of 1st Proviso to section 80G(5) of the Act. In view of the above observations, the matter is restored the file of the CIT(E) for decision afresh in the light of the observations made above.\" 5. It is to be further noted here that the Ld. CIT (Exemption) firstly mis- construed about the CBDT Circulars regarding the exemption of date for final applications for approval. The said Circular/time limits are applicable only for the institutions who stood already registered on the date of Amendment and have made application for renewal of the registration without any time break. However, the said last date which has been extended to 30.09.23 by CBDT Circular No.6 of 2023 is not applicable for making application under Clause (iii) to First Proviso to section 80G(5) of the Act. 5.3 In our humble understanding, if the view of the ld. CIT(Exemption) is accepted to be correct, then no institution which has already been into charitable activities before seeking provisional approval under Clause (iv) to First Proviso to section 80G(5) of the Act would ever be entitled to grant of final registration under Clause (iii) to First Proviso to section 80G(5) of the Act even after grant of provisional approval, which would make the relevant provisions of section 80G(5) otiose and defeat the object and purpose of these statutory provisions. 6. In view of the above discussion, it is held that after grant of provisional approval, the application cannot be rejected on the ground that the institution had already commenced its activities even prior to grant of provisional registration. Under such circumstances, the date of commencement of activity will be counted when an activity is undertaken after the grant of provisional registration either under Clause (i) or Clause (iv) to First Proviso to section 80G(5) of the Act. 7. In the case in hand, the assessee admittedly has applied for final registration after grant of provisional registration under Clause (iv) to First Proviso to section 80G(5) of the Act and therefore, the application filed by the assessee is within limitation period. The issue is otherwise squarely covered by the decision of the Coordinate Bench of the Tribunal in the case of Vivekananda Mission Asram vs. CIT (supra) and in the case of Printed from counselvise.com Ratlam Ahinsa Shiksha Samiti ITA No. 719/Ind/2024 Page 12 of 16 \"West Bengal Welfare Society vs. CIT(Exemption)\" (supra) and further by the decision in the case of \"Sri Aurobindo Bhawan Trust, Krishnagar vs. CIT(Exemption)\" order dated 20.02.2024 (Judicial Member herein being the author of the said orders). Therefore, the impugned order of the CIT(Exemption) is set aside and the ld. CIT(Exemption) is directed to grant provisional approval to the assessee under Clause (iii) to First Proviso to section 80G(5) of the Act, if the assessee is otherwise found eligible. The ld. CIT(A) will decide the application for final registration within three months of the receipt of copy of this order.” 5. Further, the Coordinate Bench of the Tribunal in the case of \"Anudip Foundation for Social Welfare vs. CIT(Exemption), Kolkata\" in I.T.A No. 1341/Kol/2023 order dated March 4th, 2024 in almost similar facts and circumstances has made the following further observations: \"4.1. It is further directed that, if the assessee is granted final approval by the ld. CIT(E) then, the benefit of approval u/s 80G of the Act, available to the assessee prior to the Amendment brought vide Amending Act of 2020, will be deemed to be continued without any break. The assessee will not be deprived of the benefit during the time period falling between 31/03/2021 and the date of grant of provisional approval under clause (iv) i.e., 28/05/2021, due to technical errors occurred in making the application under the relevant provisions of the Act because of the confusion and misunderstanding on part of the assessee as well as on part of the ld. CIT(E) in properly interpreting the relevant provisions.\" 6. The facts and issues involved in the case in hand being identical to that of the above referred to cases and in view of the findings given by the Coordinate Benches of the Tribunal, the appeal of the assessee is allowed accordingly and the ld. CIT(Exemption) is directed to grant final approval to the assessee under Clause (iii) to First Proviso to section 80G(5) of the Act, if the assessee is otherwise found eligible. It is directed that the ld. CIT(Exemption) will decide the application of the assessee for final approval as expeditiously as possible but not later than two months from the receipt of this order. It is further directed that, if the assessee is granted final approval by the ld. CIT(Exemption) then, the benefit of approval u/s 80G of the Act, if it was available to the assessee prior to the Amendment brought vide Amending Act of 2020, will be deemed to have been continued without any break. The assessee will not be deprived of the benefit during the time period falling between 31/03/2021 and the date of grant of provisional approval under clause (iv) i.e., 28/06/2022, due to technical errors occurred in making the application under the relevant provisions of the Act because of the confusion and misunderstanding on part of the assessee as well as on part of the ld. CIT(Exemption) in properly interpreting the relevant provisions. 7. With the above observations, the appeal of the assessee is treated as allowed for statistical purposes.” Printed from counselvise.com Ratlam Ahinsa Shiksha Samiti ITA No. 719/Ind/2024 Page 13 of 16 7. Ld. AR requested this bench to carry the same view as taken in above decisions and accordingly direct the CIT(E) to consider assessee’s application under clause (iii). 8. Per contra, Ld. DR for revenue insisted that the assessee filed application under “clause (iv)(B)” and the assessee also represented its case before CIT(E) claiming “clause (iv)(B)”, therefore the CIT(E) has rightly rejected the assessee’s application after observing that the assessee was not fulfilling the condition of “clause (iv)(B)”. Therefore, according to Ld. DR, there is no mistake whatsoever in CIT(E)’s order and the same should not be interfered. 9. We have carefully considered the rival submissions of both sides and the facts of case in the light of provisions of section 80G(5) and the judicial rulings as cited by Ld. AR. We find that the Govt. has introduced a new system of granting different types of approvals u/s 80G(5) in different scenerios through TOLA w.e.f. 01.04.2021. These different types of approvals can be broadly referred as ‘provisional approvals’, ‘final approvals’ and ‘renewal of approvals’. Further, the original provision introduced through TOLA had undergone further amendments through Finance Act, 2023 and Finance (No. 2) Act, 2024. On a careful reading of the two judgements of ITAT, Benches cited by Ld. AR, we find that there had been a state of confusion/understanding also in the minds of tax payers and tax administration as to the applicability of correct clause and that is why it has generated litigation and the assessees have been provided solutions by Printed from counselvise.com Ratlam Ahinsa Shiksha Samiti ITA No. 719/Ind/2024 Page 14 of 16 judicial problems. In present case also, the assessee initially filed application for provisional registration u/s 80G(5) and the same was granted by Income-tax Department through an order dated 27.12.2023 in Form No. 10AC for AY 2024-25 to 2026-27, copy of order is filed in Paper-Book. Subsequently, vide application dated 19.01.2024, the assessee applied for conversion of provisional approval into final approval but the assessee selected wrong option of “clause (iv)(B)” and the case progressed before CIT(E) on the basis of “clause (iv)(B)” although the correct clause applicable to assessee was “clause (iii)”. We find that the clause (iii) prescribes “where the institution or fund has been provisionally approved…” and it is an undisputed fact that the assessee was provisionally approved by Income-tax Department. Thereafter, the “clause (iv)(B)” starts with “in any other case”. In such a situation, we raised a specific query to Ld. DR for revenue as to how the “clause (iv)(B)” will apply which is applicable to “any other case”? Ld. DR could not respond to our query although he insisted that the assessee has filed application under “clause (iv)(B)”. After a careful consideration, we find that the assessee is holding provisional approval granted by department and therefore the assessee’s case falls under “clause (iii)” only and not “clause (iv)(B)”. We find that in the first mentioned case of Rambha Charitable Trust (supra), the ITAT Mumbai has dealt a case which is exactly identical to assessee and finally remitted the matter back to CIT(E) with a direction to grant approval to assessee under “clause (iii)”, if the assessee is otherwise found eligible. Further, in the second mentioned case of North Eastern Social Research (supra), the ITAT Kolkata dealt a Printed from counselvise.com Ratlam Ahinsa Shiksha Samiti ITA No. 719/Ind/2024 Page 15 of 16 case where the assessee, though filed application under “clause (iii)” but the CIT(A) rejected the same on the ground of time limitation but the ITAT interpreted time limit aspect and finally directed the CIT(E) to grant registration under “clause (iii)”, if the assessee is otherwise found eligible. In that view of matter, we agree that the present assessee’s case falls under “clause (iii)” since the assessee is holding the provisional approval granted by Income-tax Department and respectfully following the view taken in two decisions of ITAT Benches, we direct the CIT(E) to grant final approval to the assessee under “clause (iii)”, if the assessee is otherwise found eligible. Needless to mention that the Ld. CIT(E) shall pass order as expeditiously as possible but not later than three months from the receipt of this order. 10. Resultantly, this appeal is allowed for statistical purpose. Order pronounced in open court on 25/08/2025 Sd/- Sd/- (PARESH M. JOSHI) (B.M. BIYANI) JUDICIAL MEMBER ACCOUNTANT MEMBER Indore िदनांक/Dated : 25/08/2025 Patel/Sr. PS Printed from counselvise.com Ratlam Ahinsa Shiksha Samiti ITA No. 719/Ind/2024 Page 16 of 16 Copies to: (1) The appellant (2) The respondent (3) CIT (4) CIT(A) (5) Departmental Representative (6) Guard File By order UE COPY Sr. Private Secretary Income Tax Appellate Tribunal Indore Bench, Indore Printed from counselvise.com "