Youth Brigade Charitable Trust Vs CIT (ITAT Bangalore)
One Rejected Form 10AB Application Is Not a Lifetime Ban on Registration: Bengaluru ITAT
A charitable trust applied for regular registration under section 12AB. Its application was rejected because it did not appear before the Commissioner of Income Tax (Exemptions). The trust did not appeal that rejection. When it filed a fresh Form 10AB application, the Commissioner refused to consider it, reasoning that the earlier order had attained finality and the new application was therefore void.
The Bengaluru ITAT has rejected that approach. It held that neither section 12A nor section 12AB permanently bars a trust from applying again after an earlier rejection. An appeal against the first rejection is also not a condition for filing a fresh application. The Commissioner must examine the new application and the material submitted with it, then pass a reasoned order.
The Tribunal did not itself grant registration to Youth Brigade Charitable Trust. It sent the matter back for a fresh decision on the trust’s eligibility.
Two applications, two very different reasons for rejection
Youth Brigade Charitable Trust was constituted under a trust deed dated 17 April 2015. It received provisional registration in Form 10AC on 23 January 2023, effective from AY 2023–24 to AY 2025–26.
The trust filed its first Form 10AB on 8 December 2023, seeking regular registration under section 12AB. The CIT (Exemptions) rejected it by an order dated 11 June 2024 on the ground of non-appearance. The trust did not file an appeal against that order.
It then filed another Form 10AB on 25 April 2025. In response to notices relating to this second application, the trust furnished submissions. Yet the Commissioner did not examine the new application on its own material. By an order dated 30 December 2025, the Commissioner held that the unappealed rejection of the first application had become final. On that basis, the second application was treated as not maintainable and void from the outset.
The trust appealed to the ITAT, arguing that the Act contains no prohibition on a fresh application and that the Commissioner should have considered its objects, activities and documents.
What the CIT (Exemptions) was required to examine
The Tribunal observed that registration proceedings call for an inquiry into matters relevant under section 12AB. These include the trust’s objects and the genuineness of its activities, as well as compliance with requirements of other laws where such compliance is material to achieving its objects.
In this case, the second rejection did not find that the trust’s objects were non-charitable or its activities were not genuine. It rested solely on the fact that the trust had not appealed the rejection dated 11 June 2024. The order also failed to show an independent examination of the documents and explanations furnished with the application filed in April 2025.
That was decisive. The Commissioner could decide the fresh application after the required inquiry, but could not avoid that inquiry by treating the earlier rejection as a permanent procedural bar.
Does the earlier order’s finality prevent a new application?
The ITAT drew a distinction between the finality of an earlier rejection and the right to make a later application. The Act does not state that rejection of one registration application forever disentitles the trust from applying to the same authority. Nor does it require a trust to appeal every rejected application before it may file another.
The Tribunal held that each application must be considered independently on the facts and material relevant to it. The earlier rejection did not operate as res judicata in these registration proceedings. In particular, a first application rejected for non-appearance could not be described, without further examination, as a conclusive finding that the trust failed the substantive conditions for registration.
The department had argued that failure to appeal showed acceptance of the first rejection. Even if that order remained unchallenged, the Tribunal found that it supplied no statutory basis for refusing to entertain the second application.
The effective-date consequence
The ITAT also addressed an important limit to filing afresh. In its view, the later application could not be used to obtain registration effective from the date of the original application, 8 December 2023. The Tribunal stated that the effective date arising from consideration of the fresh application would be linked to the subsequent application filed on 25 April 2025.
Thus, a fresh filing preserved the trust’s opportunity to seek registration, but did not erase the consequence of leaving the earlier rejection unappealed. This distinction is especially relevant where the period for which registration is sought matters to the trust’s exemption claims.
What happens now?
The ITAT set aside the order dated 30 December 2025 and restored the 25 April 2025 Form 10AB application to the CIT (Exemptions). The Commissioner must examine the trust’s documents, accounts, reports and explanations, give it a reasonable opportunity of being heard, and pass a speaking order in accordance with law. The appeal was partly allowed for statistical purposes.
Author’s comment
The ruling addresses a practical problem in trust registration: an unappealed rejection closes that application; it does not automatically close the door to every future application. The Commissioner must deal with a subsequent Form 10AB on its own record and give reasons tied to the statutory conditions.
The trust has won the right to a fresh examination, not a certificate of regular registration. It will still need to establish its objects, genuine activities and relevant compliance before the Commissioner. Where registration is needed for an earlier period, the Tribunal’s observation on the effective date of the later application also makes the choice between appealing an old rejection and filing afresh consequential.
FULL TEXT OF THE ORDER OF ITAT BANGALORE
This appeal at the instance of the assessee is directed against the order of the ld. CIT(Exemptions), Bengaluru dated 30.12.2025 vide DIN & Notice No. ITBA/EXM/F/EXM45/2025-26/ 1084232153(1) rejecting the application filed in form No.10AB for registration u/s 12AB of the Income Tax Act, 1961 (in short “the Act”).
2. The assessee has raised the following grounds of appeal:-
The Appellant objects to the Rejection Order on Application u/s. 12A(1)(ac)(iii) on the following grounds in so far as it is prejudicial to the Appellant as it is opposed to law and circumstances of the case:-
1 .The CIT (Exemptions) erred in law and on facts in rejecting the application for registration under section 12AB as “not maintainable” solely on the ground that an earlier rejection order dated 1 1 .06.2024 was not appealed.
2. The CIT (Exemptions) failed to appreciate that the Income-tax Act, 1961 does not prohibit filing of a fresh application under section 12AB merely because an earlier application was rejected and not appealed against.
3. The CIT (Exemptions) erred in holding that the earlier rejection order had attained finality and therefore the present application is void ab initio, when the Act does not provide any such bar or restriction in registration proceedings under section 12AB.
4. The Rejection order is bad in law as the CIT (Exemptions) has mechanically rejected the application without conducting the mandatory enquiry as contemplated under section 12AB(1)(b)(i) and without recording satisfaction or dissatisfaction on the genuineness of activities.
5. The learned CIT (Exemptions) erred in law and on facts in refusing to consider the fresh application for registration, despite there being no statutory bar under the Income-tax Act, 1961 against filing a subsequent application, particularly when the earlier application was not disposed of on merits.
6. The Appellant craves leave to add, to alter, to amend or to delete any of the grounds that may be urged at the time of hearing of the Appeal.
Wherefore on the above grounds and on such other grounds the Appellant prays the Appellate Authority to direct CIT (exemption) to grant Registration 12A(1)(ac)(iii) and may pass such other as the Appellate Authority deems
3. Brief facts of the case are that the assessee is a trust constituted by way of deed of trust dated 17.04.2015 and established exclusively for the charitable purposes. The assessee trust was granted provisional registration by Order in Form No.10AC dated 23.01.2023 under sub-clause (vi) of clause (ac) of sub-section (1) of section 12A of the Act vide Unique Registration No.(URN):- AAATY5490QE20221 effective from AY 2023-24 to AY 2025-26. Subsequently, the assessee trust filed an application in Form No.10AB on 08.12.2023 seeking regular (Permanent) registration u/s 12AB of the Act. However, the application of the assessee trust was rejected by the ld. CIT (Exemptions) vide order dated 11.06.2024 on the ground of non-appearance.
3.1 The assessee subsequently again filed an application in Form No.10AB before the same authority on 25.04.2025 seeking regular/permanent registration u/s 12AB of the Act. The ld. CIT (Exemptions) although observed that in pursuance to notice, the assessee filed its submissions. However, rejected the application filed in form no.10AB on the ground that the assessee trust had earlier filed an application for registration u/s 12AB of the Act on 08.12.2023 and the said application was rejected vide order dated 11.06.2024. The ld. CIT (Exemptions) further observed that the assessee trust had also not preferred any appeal before the ITAT u/s 253 of the Act against the said rejection order and accordingly held that the order dated 11.06.2024 has attained finality and continues to remain in force. As the assessee trust had again filed the fresh application u/s 12AB of the Act without availing the appellate remedy, hence the ld. CIT(Exemptions) held that the present application is not maintainable and is void ab initio as the earlier rejection order on merits still stands unchallenged and effective.
4. Aggrieved by the order of ld. CIT (Exemptions) dated 30.12.2025, the assessee has filed the present appeal before this Tribunal.
5. Before us, the ld. A.R. of the assessee vehemently submitted that the ld. CIT (Exemptions) ought to have freshly examined the objects and genuineness of the activities of the trust based on the current material/records furnished by the assessee instead of rejecting the application by holding that the application is not maintainable and void ab initio as the earlier rejection order on merits was not challenged by the assessee before the ITAT and accordingly prayed that appeal of the assessee may be allowed.
6. The ld. D.R. on the other hand, relied on the order of the ld. CIT (Exemptions) and vehemently submitted that the assessee did not prefer an appeal before the Hon’ble ITAT against the earlier rejection order dated 11.06.2024 which clearly demonstrate the acceptance of the order of the ld. CIT (Exemptions) by the assessee trust.
7. We have heard the rival submissions and perused the materials available on record. Undisputedly, in the present case, the assessee was granted provisional registration in form no.10AC on 23.01.2023 under sub-clause (vi) of clause (ac) of sub-section (1) of section 12A of the Act vide Unique Registration No. (URN)- AAATY5490QE20221 effective from AY 2023-24 to AY 2025-26. Subsequently, the assessee trust filed an application in Form No.10AB on 08.12.2023 seeking regular (Permanent) registration u/s 12AB of the Act. However, the application of the assessee was rejected by the ld. CIT (Exemptions) vide order dated 11.06.2024 on the ground of non-appearance. The assessee thereafter again filed an application in Form No.10AB on 25.04.2025 before the ld. CIT(Exemptions) seeking regular/permanent registration u/s 12AB of the Act, which is rejected by the ld. CIT (Exemptions) on the ground that earlier application was rejected vide order dated 11.06.2024 and the assessee had not preferred any appeal before the ITAT against the above said rejection order and consequently the order dated 11.06.2024 has attained finality and continues to remain in force.
7.1 We are of the considered opinion that for the purpose of granting registration, the ld. CIT (Exemptions) shall call for such documents or information or make such inquiry as he/she thinks necessary in order to satisfy himself/herself about the twin objects:-
a) The genuineness of the activity of the trust and
b) The compliance of such requirements of any other law for the time being in force by the trust or institution as are material for the purpose of achieving its objects.
Undisputedly, in the present case, as observed by the ld. CIT (Exemptions), in response to the notices issued, the assessee trust had filed its submissions. We observed that the rejection of application filed for registration was not made on the ground that either the object of the trust are not charitable or that its activities are not genuine. The sole reason assigned by the ld. CIT(Exemptions) centered around on the fact that the assessee had not challenged the earlier rejection order dated 11.06.2024 and therefore, subsequent application in form no.10AB dated 25.04.2025 is not maintainable and void ab initio.
7.2 We are of the considered opinion that the very foundation of the order passed by the ld. CIT (Exemptions) is contrary to the scheme of section 12A & 12AB of the Act. The Act nowhere stipulates that the rejection of an earlier application permanently disentitles a trust from making a fresh application for registration before the same authority. Equally there is no statutory requirement that an appeal against an earlier rejection order is a condition precedent for filing the subsequent application. In our opinion, the registration proceedings u/s 12AB of the Act are independent proceedings and each application is required to be considered on the basis of facts, material available and the fulfillment of the conditions by the assessee for granting registration. Thus, we are of the considered opinion that there is no such bar/restriction under the Act on the assessee trust in filing the application in form 10AB for granting registration u/s 12AB of the Act before the same authority subsequently if the assessee trust satisfy all the conditions for granting registration u/s 12AB of the Act. It is the statutory obligation of the ld. CIT (Exemptions) on the receipt of application on each occasion to satisfy himself/herself only about the genuineness of the activity of the trust and compliance of such requirements of any other law for the time being in force by the trust or institution as are material for the purpose of achieving its objects. Merely because, the assessee trust had not preferred an appeal against the earlier rejection order dated 11.06.2024 passed by the ld. CIT (Exemptions), the assessee trust cannot be barred from exercising its statutory right subsequently before the same authority if it fulfills the conditions as laid down for granting registration u/s 12AB of the Act. In our opinion, the only consequence of subsequent filing of application before the ld. CIT (Exemptions) will be the effective date of granting the registration which will be ultimately the subsequent date of application. Thus, while entertaining the application in form no.10AB filed on 25.04.2025, the ld. CIT (Exemptions) cannot grant the registration effective from the date of original application i.e. 08.12.2023. Therefore, in our considered opinion, treating the application filed in form no.10AB on 25.04.2025 to be not maintainable and void ab initio is highly illegal and bad in law as there are no such provisions under the Act that once the application for registration is rejected by the ld. CIT(Exemptions), then the assessee can never apply for registration before the same authority forever. In our view, each application for registration is required to be considered independently whereas the earlier rejection does not operate as res judicata in income tax proceedings. The ld. CIT (Exemptions) ought to have freshly examine the objects and genuineness of the activity of the trust along with compliance of such requirements of any other law for the time being in force by the trust or institution as are material for the purpose of achieving its objects based on documents/evidences /accounts /reports furnished by the assessee. We find that the impugned order does not demonstrate any independent application of mind to the documents/records filed with the fresh application in form no.10AB dated 25.04.2025 and the rejection is completely mechanical and based on past conclusions. In view of the above, we find that the order passed by ld. CIT (Exemptions) is not sustainable and therefore, we set aside the impugned order and restore the matter back to the file of ld. CIT (Exemptions) with a direction to examine the application filed in Form No.10AB dated 25.04.2025 afresh with reference to the documents/records/accounts/ reports/explanations filed by the assessee and pass a speaking order in accordance with law after providing reasonable opportunity of being heard to the assessee. It is ordered accordingly.
8. In the result, the appeal filed by the assessee is partly allowed for statistical purposes.
Order pronounced in the open court on 24th Sept, 2026.
