Chaturbhuja Mata Mai Seva Trust Vs CIT (Exemptions) (ITAT Mumbai)
Summary: The Mumbai Bench of the Income Tax Appellate Tribunal considered the assessee’s appeal against the order dated 08.02.2026 passed by the Commissioner of Income-tax (Exemptions), Mumbai, rejecting its Form No. 10AB application dated 29.09.2025 under section 12A(1)(ac)(ii) of the Income-tax Act, 1961, seeking renewal of registration under section 12AB. The assessee was a public charitable trust constituted under the Bombay Public Trusts Act, 1950, whose stated objects included free medical camps, nutrition and hygiene education, promotion of equal opportunities for women and gender equality, old-age homes, community halls and public libraries.
The assessee had first received provisional registration in Form No. 10AC dated 27.05.2021 under section 12A(1)(ac)(vi), bearing Registration No. AACTC6372RE20206 and valid from AY 2021-22 to AY 2023-24. It subsequently received registration in Form No. 10AC dated 08.11.2021 under section 12A(1)(ac)(i), bearing URN AACTC6372RE20212 and valid from AY 2022-23 to AY 2026-27. As the registration was due to expire at the end of AY 2026-27, the assessee filed Form No. 10AB for renewal under section 12A(1)(ac)(ii).
The CIT(E), while examining the renewal application, noted that the assessee had not produced a registration certificate under section 12A or section 12AA relating to the period before 01.04.2021. Although the CIT(E) recognised that trusts without registration under the old regime were required to obtain provisional registration under section 12A(1)(ac)(vi), the renewal application was nevertheless rejected on the basis that the assessee had not established registration under the erstwhile regime. The CIT(E) consequently treated the registration granted on 08.11.2021 as invalid. A general observation regarding amendment of the trust deed was also made without identifying any specific defective clause or statutory deficiency.
Before the Tribunal, the assessee submitted that it had never possessed registration under the erstwhile section 12AA regime and had correctly obtained provisional registration under section 12A(1)(ac)(vi), followed by registration under section 12A(1)(ac)(i). It was further contended that the existing registration had never been cancelled or withdrawn and could not be collaterally declared invalid while considering an application for renewal. The assessee also argued that the notice dated 24.01.2026 did not specifically put it on notice that the validity of its existing registration would be questioned.
The Tribunal noted that the material facts were undisputed. The existing registration dated 08.11.2021 continued to remain in force and the impugned order did not refer to any order cancelling or withdrawing it. The Tribunal held that the absence of a registration certificate under the erstwhile section 12A or section 12AA could not, by itself, constitute a valid basis for rejecting the renewal application because the assessee’s case was that it had never possessed registration under the old regime and had instead obtained provisional registration under the applicable post-01.04.2021 framework. The Tribunal also held that an operative registration could not be disregarded as non-existent in collateral renewal proceedings when it had not been cancelled or withdrawn through the prescribed statutory procedure.
The Tribunal further found merit in the assessee’s natural justice contention. The notice dated 24.01.2026 sought various documents but did not specifically inform the assessee that its existing registration dated 08.11.2021 was proposed to be treated as invalid or that the renewal application would be rejected on that basis. The assessee therefore was not given an effective opportunity to address the precise ground ultimately relied upon by the CIT(E).
The Tribunal also found that the general observation concerning amendment of the trust deed could not independently support rejection because no particular defect or unlawful clause had been identified. Further, the CIT(E) had not recorded adverse findings concerning the charitable nature of the assessee’s objects, genuineness of its activities, expenditure towards its objects, maintenance of accounts, filing of returns or compliance with other relevant laws.
Accordingly, the Tribunal set aside the order dated 08.02.2026 and restored the Form No. 10AB application dated 29.09.2025 to the CIT(E) for fresh adjudication. The CIT(E) was directed not to reject the application merely because the assessee did not possess registration under section 12A or section 12AA before 01.04.2021 and was required to consider the existing Form No. 10AC registration dated 08.11.2021 in accordance with law. The CIT(E) was directed to examine eligibility for renewal with reference to the statutory requirements concerning the objects, genuineness of activities and other applicable compliance requirements.
The Tribunal further directed the CIT(E) to grant renewal of registration under section 12AB if the assessee was otherwise eligible under the Act, after providing a reasonable opportunity of being heard. The assessee was directed to furnish any further information or documents legitimately required for examining its eligibility. Grounds Nos. 1 to 4 were allowed for statistical purposes, while Ground No. 5 was treated as general. The appeal was accordingly allowed for statistical purposes.
The decision concerns the post-01.04.2021 framework for charitable-trust registration under sections 12A and 12AB. TaxGuru’s background material on the statutory framework explains the transition from the erstwhile section 12AA regime to section 12AB and the new registration mechanism. Registration of Trust under Income Tax provides an overview of the new provisions, while Section 12AB registration procedure discusses the provisional and subsequent registration process. The statutory framework and registration procedure are also addressed in Section 12AB provisions and registration procedure. TaxGuru has also discussed the renewal mechanism under section 12A(1)(ac)(ii) in its Section 12AB Registration Renewal Guide. Recent Mumbai ITAT treatment of renewal proceedings involving an existing section 12AB registration is also addressed in Existing Section 12AB Registration.
FULL TEXT OF THE ORDER OF ITAT MUMBAI
This appeal by the assessee is directed against the order in Form No. 10AD dated 08.02.2026 passed by the learned Commissioner of Income-tax (Exemptions), Mumbai, hereinafter referred to as “the learned CIT(E)”, whereby the application filed by the assessee in Form No. 10AB on 29.09.2025 under section 12A(1)(ac)(ii) of the Income-tax Act, 1961, hereinafter referred to as “the Act”, seeking renewal of registration under section 12AB of the Act, was rejected.
2. The grounds raised by the assessee are reproduced as under:
1. On the facts and circumstances the Ld. CIT (Exemptions) has rejected the renewal application u/s 12A without offering an opportunity of being heard. No show cause notice was issued that our application is liable to be rejected and the rejection order has been passed without complying with statutory requirement of adequate opportunity being given to the assessee. As such the rejection order need to be treated as void and need to be cancelled ab-initio.
2. On the facts and circumstances of the case the Ld. CIT (Exemptions) fundamentally erred in misidentifying the category of registration and applying an incorrect legal test. The Ld. CIT(E) failed to appreciate the fact that the Trust was incorporated on 21st June 2018. It was therefore never registered under the old Section 12AA regime. He also failed to appreciate the fact that, Provisional Registration was granted under section 12A(1)(ac)(vi) and Regular Registration was granted under section 12A(1)(ac)(i). The rejection causes severe hardship and prejudice to the appellant and its charitable beneficiaries.
3. On the facts and circumstances of the case the Ld. CIT (Exemptions) has failed to appreciate that the Regular Registration under Section 12AB vide Form No. 10AC bearing URN AACTC6372RE20212, valid from A.Y. 2022-23 to A.Y. 2026-27, was granted by the Principal Commissioner / Commissioner of Income Tax (CIT) on 08/11/2021 after due examination of the application in Form 10A filed by the Trust under Sub-clause (i) of clause (ac) of Section 12A(1).
4. By unwarranted and unjustified rejection of registration application by Ld. CIT(E), the equity and justice, has been denied and a great hardship has been created for the trust.
5. That the applicant reserves the right to add, alter, modify or amend any of the grounds of appeal during the course of appellate proceeding.
Facts of the case
3. The assessee is a public charitable trust constituted under the provisions of the Bombay Public Trusts Act, 1950. The stated objects of the assessee include organising free medical camps with the assistance of doctors and child specialists, providing information and education concerning nutrition and hygiene, promoting equal opportunities for women and gender equality, establishing and managing old-age homes, providing community halls and establishing and running public libraries. According to the assessee, its objects fall within the limbs of education, medical relief and relief of the poor contemplated under section 2(15) of the Act.
4. The assessee was granted provisional registration under section 12AB in Form No. 10AC dated 27.05.2021 under subclause (vi) of clause (ac) of section 12A(1) of the Act. The provisional registration was allotted Registration No. AACTC6372RE20206 and was valid from assessment year 2021- 22 to assessment year 2023-24. The certificate records that the registration was granted after considering the application and the material available on record. Subsequently, the assessee was granted registration in Form No. 10AC dated 08.11.2021 under sub-clause (i) of clause (ac) of section 12A(1) of the Act, bearing Unique Registration No. AACTC6372RE20212. The said registration was valid from assessment year 2022-23 to assessment year 2026-27.
5. Since the aforesaid registration was due to expire at the end of assessment year 2026-27, the assessee filed Form No. 10AB on 29.09.2025 under section 12A(1)(ac)(ii) of the Act seeking renewal of its registration under section 12AB.
6. The learned CIT(E), by notice dated 24.01.2026, fixed the matter for hearing on 30.01.2026 and called upon the assessee to furnish documents relating to its constitution, registration, charitable activities, financial statements, returns of income, expenditure, outstanding demands and pending legal proceedings. In response, the assessee filed its reply along with the trust deed containing the dissolution clause, registrations with the Registrar of Public Trusts and Darpan Portal, Form No. 10AC dated 08.11.2021, audited financial statements for assessment years 2022-23 to 2025-26, acknowledgements of returns and Form No. 10AB. The assessee also stated that there was no change requiring a report before the Charity Commissioner, no earlier rejection or cancellation proceeding, no outstanding tax demand and no pending proceeding under any other law. Details of expenditure incurred towards its charitable objects for the relevant assessment years and a note explaining the objects and activities of the trust were also furnished.
7. The learned CIT(E) noted that the assessee had been granted registration under section 12AB in Form No. 10AC dated 08.11.2021, valid from assessment year 2022-23 to assessment year 2026-27, but had not produced any registration certificate under section 12A or section 12AA pertaining to the period prior to 01.04.2021. Although the learned CIT(E) recognised that trusts without prior registration under the old regime were required to seek provisional registration under section 12A(1)(ac)(vi), he nevertheless held that the assessee was required to establish registration under the old regime for renewal of its registration. On this basis, the registration dated 08.11.2021 was treated as invalid and the renewal application was rejected. The learned CIT(E) also made a general observation regarding amendment of the trust deed, without identifying any specific objectionable clause or statutory deficiency. Accordingly, the application was rejected by order dated 08.02.2026.
8. Before us, the learned Authorised Representative (AR) submitted that the learned CIT(E) had fundamentally misidentified the category of registration applicable to the assessee. It was submitted that the assessee had never held registration under the erstwhile section 12AA and had initially obtained provisional registration under section 12A(1)(ac)(vi) on 27.05.2021. Thereafter, registration in Form No. 10AC was granted on 08.11.2021 under section 12A(1)(ac)(i), bearing URN AACTC6372RE20212, valid from assessment year 2022-23 to assessment year 2026-27.
9. The learned AR submitted that the learned CIT(E), having himself recognised in paragraph 3.2 of the impugned order that trusts not possessing registration under section 12AA were required to obtain provisional registration under section 12A(1)(ac)(vi), could not thereafter require the assessee to produce a registration certificate under the old regime. It was contended that this resulted in an internal inconsistency in the impugned order and that a requirement applicable to trusts registered under the erstwhile regime had wrongly been imposed upon the assessee.
10. It was further submitted that the registration in Form No. 10AC dated 08.11.2021 had remained in force and had never been cancelled or withdrawn by any competent authority. The learned CIT(E), while considering an application for renewal, could not collaterally declare the existing registration invalid. It was submitted that cancellation of registration was governed by a separate statutory procedure under section 12AB(4), which could not be substituted by proceedings for renewal of registration.
11. The learned AR also contended that the notice dated 24.01.2026 merely called for documents and did not put the assessee to notice that its existing registration was proposed to be treated as invalid. Thus, the precise ground ultimately adopted for rejection was not specifically confronted to the assessee. It was prayed that the impugned order be set aside and the learned CIT(E) be directed to grant renewal of registration after examining the application on its merits with reference to the objects, genuineness of activities and compliance with the applicable provisions of law.
12. The learned Departmental Representative relied upon the impugned order passed by the learned CIT(E). However, he did not raise any objection to the matter being restored to the file of the learned CIT(E) for fresh adjudication in accordance with law.
13. We have considered the rival submissions and perused the material placed before us. The material facts are not in dispute. The assessee was granted provisional registration in Form No. 10AC dated 27.05.2021 under sub-clause (vi) of clause (ac) of section 12A(1), valid from assessment year 2021-22 to assessment year 2023-24. Thereafter, the competent authority granted registration to the assessee in Form No. 10AC dated 08.11.2021, bearing URN AACTC6372RE20212, under subclause (i) of clause (ac) of section 12A(1), valid from assessment year 2022-23 to assessment year 2026-27. The latter registration continued to remain in force and the impugned order does not refer to any order cancelling or withdrawing the same.
14. The learned CIT(E) has rejected the renewal application principally on the ground that the assessee failed to furnish a certificate of registration under section 12A or section 12AA held prior to 01.04.2021. However, the assessee’s consistent case is that it did not possess any registration under the old regime. The learned CIT(E) has himself observed in paragraph 3.2 that trusts which did not have any prior registration under section 12AA or approval under section 10(23C) were required to apply for provisional registration under sub-clause (vi) of clause (ac) of section 12A(1). The record demonstrates that provisional registration was, in fact, granted to the assessee under the said sub-clause on 27.05.2021.
15. In these circumstances, the absence of a registration certificate under the erstwhile section 12A or section 12AA could not, by itself, constitute a valid basis for rejecting the assessee’s application for renewal. The existing registration dated 08.11.2021 was granted by the competent authority and remained operative during the relevant period. So long as the said registration had not been cancelled or withdrawn by following the procedure prescribed under the Act, it could not have been disregarded as non-existent in collateral proceedings concerning renewal.
16. We also find merit in the contention that the notice dated 24.01.2026 did not specifically inform the assessee that the validity of its registration dated 08.11.2021 was proposed to be questioned and that the renewal application was liable to be rejected on that basis. The notice called upon the assessee to furnish various documents, including the earlier registration under the old regime, but did not set out the proposed conclusion that the existing registration itself would be treated as invalid. The assessee was, therefore, not afforded an effective opportunity to address the precise ground ultimately adopted in the impugned order.
17. As regards the general observation in paragraph 4 of the impugned order concerning the alleged need to amend the trust deed or memorandum of association, we find that no particular defect in the trust deed has been identified. No clause has been held to be contrary to law and no specific amendment required to be made has been stated. On the contrary, the assessee had furnished the trust deed and specifically brought the dissolution clause contained in clause 31 to the notice of the learned CIT(E). Therefore, the said general observation, unsupported by any specific factual finding, cannot constitute an independent ground for rejection.
18. Significantly, the learned CIT(E) has not recorded any adverse finding regarding the charitable nature of the objects of the assessee, the genuineness of its activities, the expenditure incurred towards its objects, the maintenance of accounts, the filing of returns of income, or compliance with any other law material for achieving its objects. No other specific statutory deficiency has been pointed out in the impugned order. The rejection rests substantially upon the non-production of a registration certificate under the old regime and the consequential conclusion that the registration dated 08.11.2021 was invalid.
19. In view of the foregoing, the impugned order dated 08.02.2026 is set aside and the application filed by the assessee in Form No. 10AB on 29.09.2025 is restored to the file of the learned CIT(E) for fresh adjudication. The learned CIT(E) shall not reject the application merely on the ground that the assessee did not possess registration under section 12A or section 12AA prior to 01.04.2021. The learned CIT(E) shall consider the existing registration in Form No. 10AC dated 08.11.2021 in accordance with law and shall examine the assessee’s eligibility for renewal with reference to the statutory requirements relating to its objects, genuineness of activities and compliance with such other law as is material for achieving its objects.
20. Since no other specific deficiency has been recorded in the impugned order, we direct the learned CIT(E) to grant renewal of registration under section 12AB to the assessee, if the assessee is otherwise eligible under the Act. A reasonable opportunity of being heard shall be afforded to the assessee before passing a fresh order. The assessee is also directed to furnish such further information or documents as may legitimately be required for the limited purpose of examining its eligibility under the applicable provisions.
21. Grounds Nos. 1 to 4 are accordingly allowed for statistical purposes. Ground No. 5 is general in nature and does not require separate adjudication.
22. In the result, the appeal filed by the assessee is allowed for statistical purposes.
Order pronounced in the open court on 02.07.2026.
