Smt. Mangla Ramniwas Mandhani ABMM Awas Yojana Foundation Vs CIT (Exemption) (ITAT Pune)
Summary: The Income Tax Appellate Tribunal, Pune, dismissed the appeal of Smt. Mangla Ramniwas Mandhani ABMM Awas Yojana Foundation against the order of the Commissioner of Income Tax (Exemption), Pune, dated 16 December 2023, refusing approval under Section 80G(5) of the Income Tax Act, 1961. The assessee was a charitable trust established to provide assistance to poor and deserving persons through housing, hostels for women and orphans, old-age homes, day-care centres and facilities for senior citizens. It had received provisional approval under Section 80G(5) on 24 September 2022. Subsequently, it filed Form 10AB on 29 August 2023, whereas the prescribed deadline identified by the Commissioner was 28 June 2023. The Commissioner rejected the application as time-barred, holding that the statutory provisions did not confer power to condone the delay.
Before the Tribunal, the assessee relied on CBDT Circular No. 07/2024 dated 25 April 2024 and requested the benefit of the extended time for filing Form 10AB. The Department opposed the request, pointing out that the Commissioner’s order had already been passed before issuance of the circular and that paragraph 4.1 restricted its application in such circumstances. The Tribunal accepted the Department’s submission and held that the circular could not be applied to the assessee’s application, which had already been disposed of. It then examined the first proviso to Section 80G(5), including the filing requirements applicable to provisionally approved institutions, and concluded that neither the Commissioner nor the appellate authority had been expressly empowered to condone delay in filing Form 10AB.
The Tribunal considered the distinction between statutory powers to condone delay in appellate proceedings and the absence of corresponding authority under Section 80G(5). It referred to Sections 249 and 254 of the Income Tax Act and Sections 5 and 14 of the Limitation Act, 1963. Relying on decisions including Nityananda M. Joshi v. Life Insurance Corporation of India, CIT v. Western India Engineering Co. Ltd., Commissioner of Agricultural Income Tax v. Thalayar Rubber Industries and ACIT v. Kedar Nath Jhunjhunwalla, it observed that a statutory tribunal cannot exercise powers of condonation merely on equitable considerations when the governing legislation does not provide such authority. The Tribunal also referred to the Supreme Court decisions in State of U.P. v. Harish Chandra and Union of India v. Kirloskar Pneumatic Co. Ltd.
Accordingly, the Tribunal upheld the Commissioner’s refusal to grant Section 80G approval and dismissed the assessee’s appeal by its order pronounced on 16 May 2024. The ruling emphasises that statutory deadlines and the availability of condonation must be examined under the governing provisions rather than assumed from general principles of limitation. For charitable institutions seeking regular approval after provisional approval, the decision highlights the importance of timely filing of Form 10AB and checking the precise applicability of CBDT extensions. The source order contains some inconsistencies in its description of the filing delay and dates; those do not alter its stated conclusion that the application was late and that the appeal was dismissed.
Cases Discussed
- State of UP Vs. Harish Chandra — AIR 1996 SC 2173
- Union of India Vs. Kirloskar Pneumatic Co. Ltd. — 1996 taxmann.com 575 (SC), as cited in source
- Nityananda M. Joshi vs. Life Insurance Corporation of India — AIR 1970 SC 209
- CIT vs. Western India Engineering Co. Ltd. — 77 ITR 165
- Comm. of Agrl. I.T. vs. Thalayar Rubber Industries — 131 ITR 162
- Asst CIT vs. Kedar Nath Jhunjhunwalla — 133 ITR 746
FULL TEXT OF THE ORDER OF ITAT PUNE
This is an appeal filed by the assessee directed against the order passed by the ld. Commissioner of Income Tax, Exemption, Pune [‘the CIT, Exemption’] dated 16.12.2023 denying the grant of approval u/s.80G(5) of the Income Tax Act, 1961 (‘the Act’).
2. Briefly, the facts of the case are that the appellant is a charitable Trust formed with the object of providing relief to poor and deserving persons by way of giving reliefs for setting up homes and hostels for women, orphans old age homes, day care centres and such other facilities for senior citizens and measures etc. The appellant was grantedprovisional approval u/s.80G(5)(vi) read with clause (iv) of first proviso to section 80G(5) of the Act on 24.09.2022. Thereafter, the appellant trust had filed application in Form 10AB under clause (iii) of first proviso to sub-section (5) of section 80G on 29.08.2023. The said application came to be rejected by the ld. CIT, Exemption vide order dated 16.12.2023 on the ground that the application was not filed within six months from the date of grant oprovisional approval , i.e., on or before 28.06.2023. Since the application was filed by the appellant on 29.08.2023, the ld. CIT, Exemption placing reliance on the judgment of Hon’ble Supreme Court in the case of State of UP Vs. Harish Chandra AIR 1996 SC 2173 as well as Union of India Vs. Kirloskar Pneumatic Co. Ltd. 1996 taxmann.com 575 (SC) held that in the absence of power to condone the delay the statutory authority cannot condone the delay. Thus, the ld. CIT, Exemption denied the approval u/s.80G(5) of the Act.
3. Being aggrieved, the appellant is in appeal before the Tribunal in the present appeal.
4. The ld. AR submits that by virtue of CBDT Circular No.07/2024, dt.25.04.2024 the benefit of extended time for filing application Form 10AB may be granted to the appellant trust.
5. On the other hand, ld. CIT-DR opposed the above submission by contending that in view of contents of para 4.1 of the said CBDT circular, benefit of circular cannot be extended to the appellant trust as the application made by the appellant trust was disposed of before the issue of said circular.
6. We heard the rival submissions and perused the materiel on record. Theprovisional approval was granted to the appellant trust u/s.80G(5) on 24.09.2022. Then, the appellant had made application in Form 10AB on 28.08.2023. The appellant trust was required to file application in Form 10AB on or before 28.06.2023 but the same came to be filed on 29.08.2023. It is an admitted fact that the ld. CIT, Exemption had already disposed the application before the issue of CBDT Circular No.07/2024, dt. 25.04.2024, therefore, we concur with the submission of ld. CIR-DR that benefit of said circular cannot be extended to the appellant trust. The relevant provisions of section 80G(5) read as under :
“(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 :—
(i) where the institution or fund derives any income, such income would not be liable to inclusion in its total income under the provisions of sections 11 and 12 or clause (23AA) or clause (23C) of section 10.
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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, 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:]
……
Provided also that the order under clause (i), sub-clause (b) of clause (ii) and clause (iii) of the [second] proviso shall be passed in such form and manner as may be prescribed, before expiry of the period of three months, six months and one month, respectively, calculated from the end of the month in which the application was received:
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.
From the above provisions, it is very clear that no power is conferred upon neither on the CIT tocondone the delay in filing Form 10AB, nor on Appellate Authority.
7. In the present case, the provisional approval u/s.80G(5) was granted to the appellant trust on 24.09.2022. The appellant trust was required to file application in Form 10AB on or before 28.06.2023 but the same came to be filed on 29.08.2023. Thus, there is a delay of more than six months. Therefore, the question to be answered is that whether the Tribunal, while exercising the power vested under the provisions of section 80G(5) can condone the delay occurred in filing the appeal. A mere perusal of provisions of section 80G(5), it would reveal that the Legislature has not vested the Tribunal with the power tocondone the delay in filing the appeal. The scheme of the Act would disclose that the Legislature had deliberately excluded the application of the principles underlying section 5 and 14 of the Limitation Act in relation to the provisions of section 80G of the Income Tax Act. However, the Legislature had vested the power to condonation of delay in relation to the provisions of section 249 and section 254 of the Act. Thus, the very fact that the Legislature had provided for a power to condonation of delay in relation to the provisions of section 249 and section 254 of the Act shows that the Legislature had consciously excluded the power of Tribunal to condone the delay in relation to the provisions of section 80G(5)of the Act. In this connection, we would like reference to the order of the Hon’ble Supreme Court in the case of Nityananda M. Joshi vs. Life Insurance Corporation of India, AIR 1970 SC 209 held that in view of section 4 & 5 of the Limitation Act, it would be clear that the scheme of the Act is that it only deals with applications to courts and the Labour Court is not a court within the meaning of the Limitation Act, and, therefore, an application u/s 33C(2) cannot be held to be barred under Article 137, insofar as the claim was for a period beyond three years.
8. It is settled position of law that in the absence of any statutory provisions, no power exists in the authority to condone the delay. It is also equally settled position of law that the provisions of section 5 of the Limitation Act have no application to the proceedings before the Tribunal. In the case of CIT vs. Western India Engineering Co. Ltd., 77 ITR 165, the Division Bench of the Hon’ble Gujarat High Court has held that the Appellate Tribunal under Section 66(1) of the Income Tax Act, 1961 is not a court but is merely a tribunal exercising the judicial power of the State. As the provisions of the Limitation Act are not intended to be made applicable to proceedings before authorities other than courts governed by the Code of Civil Procedure or the Code of Criminal Procedure, Section 5 of the Limitation Act, will not apply to applications made to the Appellate Tribunal and, therefore, the Tribunal has no power to condone delay in filing reference applications under Section 66(1) of the Income Tax Act, 1961.
In 9. Comm, of Agrl. I.T. vs. Thalayar Rubber Industries, 131 ITR 162 a Full Bench of the Hon’ble Kerala High Court has held that Section 69 of the Kerala Agricultural Income Tax Act, 1950, indicates that provisions of sections 4 to 24 of the Limitation Act are not attracted to proceedings under the Act and the Tribunal has no jurisdiction to condone delay in filing an application for reference under Section 60(1) of the said Act.
10. In Asst CIT vs. Kedar Nath Jhunjhunwalla, 133 ITR 746 a Division Bench of the Hon’ble Patna High Court has held that Section 29(2) of the Limitation Act will apply to appeals and applications filed under a special law only where the scheme of the special law does not exclude its application. Neither the provision of Section 5 nor that of Section 12(2) of the Limitation Act will apply to appeals filed under Section 269H of the Income Tax Act, 1961.
11. On the conspectus of the decisions referred to above and their ratios, it would be clear that the Tribunal constituted under the provisions of Income Tax Act, 1961 is not a Court but a Tribunal unless there is express power conferred by the said Act to condone the delay or exclude any period of limitation, the Tribunal would not be clothed with the power to condone the delay. It is trite law that in the absence of any conferment of power by the statute, the Tribunal cannot condone the delay in filing the application in Form 10AB. Thus, the ld. CIT, Exemption had rightly denied the grant of approval u/s.80G(5) by placing reliance on the judgment in the case of State of UP Vs. Harish Chandra AIR 1996 SC 2173 as well as Union of India Vs. Kirloskar Pneumatic Co. Ltd. 1996 com 575 (SC)
12. In view of the above legal position, the ld. CIT, Exemption, Pune is justified in denying grant of approval u/s.80G(5) of the Act.
13. In the result, the appeal filed by the assessee is dismissed.
Order pronounced on this 16th day of May, 2024.
