Guru Singh Sabha Vs CIT (Exemption) (ITAT Mumbai)
The Income Tax Appellate Tribunal (ITAT), Mumbai, in the case of Guru Singh Sabha Vs CIT (Exemption), restored the matter of rejecting a charitable trust’s application for Section 80G(5) fund approval back to the Commissioner of Income Tax (Exemption) (CIT(E)). The assessee, a charitable trust already holding Section 12AB registration and provisional 80G approval, applied for regular 80G approval in Form 10AB. The CIT(E) rejected the application on two primary grounds: it was filed beyond the prescribed time limit, and the applicant had inadvertently clicked the wrong clause—clause (iii) instead of clause (vi) of the first proviso to Section 80G(5). The ITAT noted that the rejection orders by the CIT(E) were not passed on the merits of the trust’s objects or activities. The Tribunal pointed out that the time limit for filing the application had been extended by the Central Board of Direct Taxes (CBDT) via Circular No. 7 of 2024. Given this extension, the ITAT directed the CIT(E) to accept the application as having been filed within the permissible time frame. Regarding the incorrect clause selection, the ITAT ruled this to be a procedural irregularity and not fatal to the application, directing the CIT(E) to treat the application as filed under the appropriate clause. Consequently, the ITAT restored the matter, instructing the CIT(E) to reconsider the application on its merits and provide the assessee with a fair opportunity to be heard, thus allowing the trust to pursue the vital tax exemption status.
