Aatman Foundation Vs CIT (Exemption) (ITAT Ahmedabad)
Income Tax Appellate Tribunal (ITAT) Ahmedabad Bench has reversed and remanded the rejection of Aatman Foundation’s application for 80G approval (Form 10AB). The foundation’s appeal challenged the Commissioner of Income Tax (Exemption) [CIT(E)]’s decision to deem their application non-maintainable due to an alleged violation of eligibility conditions under Section 80G(5)(iv)(B) of the Income Tax Act. The ITAT condoned a 109-day delay in filing the appeal.
Aatman Foundation had initially submitted an application in Form 10AB on February 23, 2024, seeking approval under Section 80G(5)(iv)(B). During the scrutiny process, the CIT(E) noted that to qualify under this specific sub-clause, an institution must have commenced its activities and must not have claimed income exemption under certain clauses of Section 10 or under Sections 11 or 12 for any previous year up to the application date. The CIT(E) queried the Aatman Foundation on this point. In response, the foundation confirmed that it had, in fact, claimed exemptions under Sections 11 and 12 previously, based on an earlier approval granted under Section 12AA. Consequently, the CIT(E) concluded that the eligibility conditions for Section 80G(5)(iv)(B) had been violated, rendering the application non-maintainable.
Before the ITAT, the counsel for Aatman Foundation contended that the application in Form 10AB contained an inadvertent error. It was submitted that the application was mistakenly filed under sub-clause (B) of clause (iv) of the first proviso to sub-section (5) of Section 80G, instead of the correct provision, which should have been clause (iii) of the first proviso to sub-section (5) of Section 80G. The counsel requested that the matter be remitted back to the CIT(E) for a fresh consideration, taking into account this purported clerical error.
