Conwest and Manjula S Badani Jain Vs CIT (Exemptions) (ITAT Mumbai)
The Income Tax Appellate Tribunal (ITAT), Mumbai, in the case of Conwest and Manjula S Badani Jain Vs CIT (Exemptions), restored an application for final approval under Section 80G(5) of the Income Tax Act to the Commissioner of Income Tax (Exemptions) (CIT(E)) for fresh consideration on merits. The ITAT ruled that the CIT(E)’s decision to reject the application solely because the applicant, a charitable trust, selected the wrong sub-clause in the online Form 10AB was an error, deeming the defect curable and non-fatal.
Case Details and Assessee’s Submissions
The assessee, a trust running a charitable institution including a hospital, had applied for final approval of its fund under Section 80G(5), which allows donors to claim tax deductions. During the application process, the assessee inadvertently selected sub-clause (ii) instead of the appropriate sub-clause (iii) of the first proviso to Section 80G(5) in the online Form 10AB. The CIT(E) rejected the entire application on this technical ground alone, without examining the case’s merits.
Appearing before the ITAT, the Authorized Representative (AR) for the assessee argued that this mistake was a bona fide and inadvertent error and that the assessee had fulfilled all requisite conditions and furnished all necessary details. The AR contended that since the CIT(E) had not provided a finding on the merits of the trust’s eligibility, the matter should be remanded for a proper decision. The AR also disclosed a 25-day delay in filing the original application (filed on October 25, 2024, instead of the September 30, 2021, deadline) and requested condonation of this delay, citing Tribunal and High Court precedents regarding bona fide reasons.
