SHRI SHRUTOPASAK GAN CHARITABLE TRUST,VADODARA V. THE CIT(EXEMPTION), AHMEDABAD

ITA 1666/AHD/2025

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The case involves Shri Shrutopasak Gan Charitable Trust, which appealed against the decision of the Commissioner of Income Tax (Exemption), Ahmedabad, rejecting their application for regular registration under Section 80G(5)(iii) due to a delay in filing. The Trust argued that the delay was due to a bona fide misunderstanding by newly appointed trustees about the procedural requirements. The Tribunal found merit in the Trust's explanation, noting that substantial justice should prevail over technical considerations, and thus decided to condone the delay and remand the case for re-evaluation.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 790405 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-11-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: misc
• Appeal Filed On: 29-08-2025
• Other Referred Cases: Grow Foundation vs CIT(E), Swachh Vapi Mission Trust vs. CIT(E)
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AKHILENDRA PRATAP YADAV
• Assessee Lawyers: SURENDRA MODIANI
• Keywords: Set aside; Charitable institution; Procedural lapse
• Section: 12A; 80G

Judgement Text

"THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD “A” BENCH, AHMEDABAD BEFORE MS. SUCHITRA KAMBLE, JUDICIAL MEMBER AND SHRI NARENDRA PRASAD SINHA, ACCOUNTANT MEMBER ITA No.1666/Ahd/2025 Shri Shrutopasak Gan Charitable Trust, 203, Paradise Complex, Sayajigunj, Vadodara – 390 020. (Gujarat) [PAN – ABGTS 5634 K] Vs. Commissioner of Income Tax (Exemption), Room No.609, 6th Floor, Aayakar Bhawan (Vejalpur), Near Sachin Tower, 100 Foot Road, Anandnagar-Prahladnagar Road, Ahmedabad – 380 015. (Gujarat) (Appellant) (Respondent) Assessee by Shri Surendra Modiani, AR Revenue by Shri Akhilendra Pratap Yadav, CIT-DR Date of Hearing 03.11.2025 Date of Pronouncement 25.11.2025 O R D E R PER SHRI NARENDRA PRASAD SINHA, AM: This appeal is filed by the assessee against the order of the Commissioner of Income Tax (Exemption), Ahmedabad (in short “the CIT(E)”) dated 30.06.2025 in the proceedings under Section 80G(5)(iii) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’). 2. The brief facts of the case are that the assessee is a public charitable and religious trust registered under the Bombay Public Trust Act. The assessee was approved and granted registration under Section 12AB(1)(b) of the Act valid for A.Y. 2024-25 to 2028-29. The assessee was also granted provisional approval of registration under Section Printed from counselvise.com ITA No.1666/Ahd/2025 Shri Shrutopasak Gan Charitable Trust vs. CIT (E) Page 2 of 6 80G(5) of the Act vide order dated 10.10.2023 valid from A.Y. 2024-25 to 2026-27. Thereafter, the assessee filed an application in form 10AB dated 01.10.2024 seeking regular registration under Section 80G(5)(iii) of the Act. This application of the assessee was, however, rejected by the Ld. CIT(E) vide the impugned order for the reason that there was delay in filing the application which was not condoned. Further, the provisional approval granted earlier was also cancelled. 3. Aggrieved with the order of the Ld. CIT(E), the assessee is in appeal before us. The following grounds have been taken in this appeal: - “1. That the Learned Commissioner of Income Tax (Exemption), Ahmedabad, has erred in law and facts by rejecting the application in Form No.10AB under sub-section (5) of section 80G of the Income Tax Act, 1961 for the Registration under Clause (iii) of first proviso to sub-section (5) of section 80G of the Income Tax Act, 1961 and further cancelling of the provisional registration granted under Form 10AC dated 10-10-2023. Your Honors are requested to direct the Commissioner of Income Tax (Exemption) to grant registration under section 80G of the Act and the provisional registration shall not be cancelled. That the appellant craves leave to add, amend or withdraw any ground of appeal before or during the hearing.” 4. Shri Surendra Modiani, Ld. AR of the assessee submitted that an application of the assessee for regular registration under Section 80G(5)(iii) of the Act was rejected only for the reason that there was delay in filing the application. He submitted that there was a bona-fide misunderstanding of the procedural requirements by the newly appointed Trustees, who are unfamiliar with the technicalities of the amendment to Section 12A and 80G of the Act. In fact, they were unaware of the distinction between the provisional registration and the mandatory Printed from counselvise.com ITA No.1666/Ahd/2025 Shri Shrutopasak Gan Charitable Trust vs. CIT (E) Page 3 of 6 application for regular registration within the specific period of commencement of charitable activities. He submitted that the Trust had taken corrective steps on realising the mistake and filed Form No.10AB on 01.10.2024 which was slightly beyond the extended timeline till 30.06.2024. The Ld. AR submitted that the procedural lapses should not defeat the substantive justice and, therefore, the delay in filing of the application may kindly be condoned and the matter be remanded to the Ld. CIT(E) for re-adjudication of the assessee’s application. 5. Per contra, Shri Akhilendra Pratap Yadav, Ld. CIT-DR supported the order of the Ld. CIT(E). 6. We have considered the rival submissions. The Ld. CIT(E) has rejected the application of the assessee only for the reason that there was delay in filing Form No.10AB. The assessee was required to file the application within six months of commencement of the activities or at least six months prior to the expiry of the period of provisional approval, whichever was earlier. Since the business activities of the assessee had commenced on 09.08.2023, it was required to file the application within a period of six months therefrom. The period of filing the application was periodically extended by the CBDT and the last extension granted was till 30.06.2024. However, the assessee filed the present application beyond this extended period on 01.10.2024. In the process, there was a delay of almost three months in filing of this application. The Ld. CIT(E) had refused to condone the delay on the ground that he did not have any such vested power to condone the delay. Printed from counselvise.com ITA No.1666/Ahd/2025 Shri Shrutopasak Gan Charitable Trust vs. CIT (E) Page 4 of 6 6.1 The assessee has filed an affidavit of the trustees, explaining the reason for the delay. It has been submitted that the trustees were under bona-fide impression that the provisional registration granted on 10.10.2023 would remain valid till 31.03.2026 and there was no immediate requirement to file any further application. It is further submitted that the trustees were unaware of the statutory requirement to file Form No.10AB for regular registration under Section 80G(iii) of the Act after the commencement of the activities, within a period of six months. The assessee being new trust, the explanation of the assessee that the trustees were unaware about the various requirements under the provisions of the Act, is found to be acceptable. There is no presumption that the delay in filing the application was deliberate or on account of culpable negligence or on account of mala-fide act. The assessee does not stand to benefit by resorting to delay in filing the application. It is settled position that when substantial justice and technical considerations are pitted against each other, the case of substantial justice deserves to be preferred. It is also a settled position that a meritorious matter should not be thrown out at the very threshold by not condoning the delay, as such action may defeat the cause of justice. It was an acknowledged fact that many Trusts had missed the deadline to file the application and, therefore, the CBDT had periodically extended the time limit for filing the application. The denial of Section 80G approval would cause undue hardship and injustice to genuine charitable activities of the trust. The Co-ordinate Bench of this Tribunal in the case of Grow Foundation vs CIT(E) in ITA No.734/Ahd/2024 dated 10.09.2024 had restored the matter to the Ld. CIT(E) in an identical case of delay in filing the Form 10AB. Similarly, the Co-ordinate Bench of Surat Tribunal in the case of Swachh Vapi Mission Trust vs. CIT(E) in ITA No.583/SRT/2023 dated 11.03.2024 Printed from counselvise.com ITA No.1666/Ahd/2025 Shri Shrutopasak Gan Charitable Trust vs. CIT (E) Page 5 of 6 had also remanded the matter to the CIT(E) after condoning the delay in filing the application. 6.2 The delay in filing the application is a subject matter of finding of fact. We are convinced with the explanation of the assessee regarding the delay in filing the present application. Therefore, following the orders of the Co-ordinate Benches as referred above, we condone the delay on the part of the assessee in filing the Form No.10AB. We also deem it proper to set aside the order of the Ld. CIT(E) and remit the matter back to him to adjudicate the issue of approval under Section 80G(5)(iii) of the Act afresh, on merits. The Ld. CIT(E) will be free to consider the fulfilment of all other conditions as provided in the Act and also about the satisfaction about the genuineness of the activities of the trust. The assessee is also directed to file the relevant details and documents before the Ld. CIT(E) as and when required by him. 7. In the result, the appeal of the assessee is allowed for statistical purpose. Order pronounced in the open Court on this 25th November, 2025. Sd/- Sd/- (SUCHITRA KAMBLE) (NARENDRA PRASAD SINHA) Judicial Member Accountant Member Ahmedabad, the 25th November, 2025 PBN/* Printed from counselvise.com ITA No.1666/Ahd/2025 Shri Shrutopasak Gan Charitable Trust vs. CIT (E) Page 6 of 6 Copies to: (1) The appellant (2) The respondent (3) The PCIT (4) The CIT(A) (5) Departmental Representative (6) Guard File By order TRUE COPYE COPY Assistant Registrar Income Tax Appellate Tribunal Ahmedabad benches, Ahmedabad Printed from counselvise.com "