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2025 Supreme(Online)(ITAT) 6566
INCOME TAX APPELLATE TRIBUNAL (AHMEDABAD BENCH)
Ms SUCHITRA KAMBLE, J, SHRI MAKARAND V. MAHADEOKAR, ACJ
Assessee – Appellant
Versus
Ld. Commissioner of Income-tax (Exemptions), Ahmedabad – Respondent
Income Tax Appeal No. 456/Ahd/2025
For the Appellants: Shri Mehul Thakkar, AR
For the Respondents: Shri Rignesh Das, CIT-DR
Past claims of exemption under income tax do not disqualify a charitable trust from seeking approval under Section 80G(5) as per legislative intent.
Headnote:(A) Income-tax Act, 1961 - Section 80G(5) - Approval for exemption - Application for approval under section 80G(5) rejected by Ld. CIT(E) on the grounds of prior claims of exemption under section 11 and section 10(23C) - Supreme Court's judgment in Collector, Land Acquisition v. Mst. Katiji emphasizes a liberal approach to condoning delays - Court clarifies that prior claims do not disbar a trust from seeking approval - Appeal allowed, order of Ld. CIT(E) quashed. (Paras 23, 24)
(B) Interpretation of Law - Courts should adopt a purposive interpretation rather than a restrictive one, especially in relation to legislative intent allowing trusts to seek approvals under section 80G(5). (Paras 20, 22)
Facts of the case:
The appellant is a public charitable trust which filed an application for approval under sub-section 80G(5) but was denied by the Ld. CIT(E) due to prior claims of exemption. The trust argued against this restrictive interpretation and cited legislative changes.
Findings of Court:
The court upheld the appeal and quashed the previous decision. Legislative intent favors facilitating applications for approval and not restricting them based on past exemptions.
Issues: Whether the rejection of the application based on past claims of exemption was valid, and the correct interpretation of section 80G.
Ratio Decidendi: The court determined that past claims do not inherently disqualify the trust's application for exemption approval; legislative intent supports the facilitation of such applications.
Result: Appeal allowed for statistical purposes.
| Table of Content |
|---|
| 1. condonation of delay upheld (Para 2 , 4 , 5) |
| 2. application details and prior claims outlined (Para 7 , 8 , 9) |
| 3. legislative intent favors approval applications for trusts (Para 20 , 22 , 24) |
आदेश/ORDER
PER MAKARAND V. MAHADEOKAR, AM:
This appeal by the assessee is directed against the order passed by the Learned Commissioner of Income-tax (Exemptions), Ahmedabad [hereinafter referred to as “Ld. CIT(E)”] dated 14.08.2024, whereby the assessee’s application in Form No. 10AB seeking approval under section 80G(5) of the Income-tax Act, 1961 [hereinafter referred to as “the Act”] was rejected by invoking the provisions of section 80G(5)(iv)(B).
Condonation of Delay
2. At the outset, it is noted that there is a delay in filing the present appeal. As per the Registry, the appeal has been filed with a delay of 119 days beyond the prescribed limitation period, whereas as per the assessee’s computation, the delay is of 137 days.
3. The assessee has filed an application for condonation of delay along with an affidavit of one of its trustees, Shri Bhaktiswaroop Dharmaprasad, explaining the reasons for the delay. It has been submitted therein that the order of the Ld. CIT(E) dated 14.08.2024 was communicated to the registered email ID of the trust, namely rajendra_rabari@yahoo.com, which belonged to one of the trustees, Shri Rajendra Rabari. Since Shri Rabari had resigned from the Trust with effect from 05.12.2023, he did not inform the Trust about the passing of the impugned order. The other general-purpose email ID of the Trust, adharshilavidhyalaya@gmail.com, being accessed by multiple staff members, inadvertently missed the said communication.
4. It was further explained that the Trust came to know about the rejection order only on 22.02.2025, while reviewing its tax demand status, and thereafter immediately took steps to file the present appeal on 27.02.2025. Thus, the delay, according to the assessee, was neither deliberate nor attributable to negligence but was caused due to bona fide circumstances beyond its control. It has been pleaded that the assessee has a meritorious case on merits, and unless the delay is condoned, it would suffer irreparable harm and injury by denial of the right to appeal.
5. The Learned Departmental Representative (DR) fairly submitted that he has no serious objection if the delay is condoned, considering the explanation offered by the assessee.
6. We have considered the rival submissions. The Hon’ble Supreme Court in the case of Collector, Land Acquisition v. Mst. Katiji [(1987) 167 ITR 471 (SC)] has held that a liberal approach is to be adopted in condoning delay, so as to advance substantial justice where no negligence, inaction or lack of bona fides can be attributed to the applicant. Keeping in view the reasons explained in the condonation petition and supported by affidavit, and also the fact that the delay was occasioned due to circumstances beyond the control of the assessee, we are satisfied that the assessee was prevented by sufficient cause from filing the appeal within the prescribed time.
Accordingly, the delay in filing the appeal is condoned. The appeal is admitted for adjudication on merits.
Facts of the Case
7. The appellant is a public charitable trust registered under the Bombay Public Trusts Act, 1950, vide Registration No. E/3082/Anand dated 26.09.2013, and is engaged in running various educational institutions under the name Adharshila Vidhyalaya. On 06.02.2024, the appellant filed an application in Form No. 10AB before the Ld. CIT(E), Ahmedabad, seeking approval under section 80G(5) of the Act. The Ld. CIT(E) issued statutory notices dated 11.06.2024 and 01.07.2024, requiring the assessee to furnish details/documents in support of its application. The assessee, vide reply dated 19.07.2024, furnished the required details and explained that it satisfied all the conditions prescribed under section 80G(5) of the Act.
8. The Ld. CIT(E), after examining the details, reproduced th
