Case Law Details
Madhav Gaushala Charitable Trust Vs CIT (Exemption) (ITAT Chandigarh)
The appeal initiated by the assessee Trust challenges the rejection of its final registration under section 80G of the Income Tax Act, 1961, citing limitation issues. This article explores the intricacies of the case, including the grounds of rejection, the Trust’s arguments, and the subsequent decision.
Detailed Analysis:
The rejection by the ld. Commissioner of Income Tax (Exemptions) was primarily based on the Trust’s failure to submit its final registration within the stipulated timeframe, as outlined in the relevant provisions of the Act. Despite the Trust’s claims of technical glitches hindering the submission process, the application was deemed untimely.
The Trust, represented by its counsel, presented evidence demonstrating its efforts to submit the application before the deadline. Technical issues encountered on the Income Tax Department’s website were cited as the reason for the delay. Correspondence with the Department, including emails and communications with the Help Desk, highlighted the Trust’s proactive approach in addressing the matter.
Arguing that the delay was unintentional and beyond its control, the Trust contended that the dismissal on grounds of limitation was unjustified. It emphasized the efforts made to comply within the extended period of limitation, asserting that the rejection overlooked the extenuating circumstances.
The decision to set aside the ld. CIT(E)’s order and remand the matter for reconsideration underscores the importance of evaluating cases on their merits. Despite the procedural setback, the Trust’s right to a fair assessment of its application was upheld, affirming the principles of justice and equity.
Conclusion:
The case exemplifies the challenges faced by entities seeking tax exemptions under Section 80G. While adherence to statutory timelines is crucial, the allowance for unforeseen circumstances is equally significant. The Trust’s successful appeal underscores the importance of procedural fairness and the need for nuanced consideration in tax matters.
FULL TEXT OF THE ORDER OF ITAT CHANDIGARH
The present appeal has been preferred by the assessee Trust against the order passed by the ld. Commissioner of Income Tax (Exemptions), Chandigarh [hereinafter referred to as ‘ld.CI T(E)’] dated 11.07.2023 pertaining to 2022-23 assessment year whereby, the application of the assessee Trust for final registration u/s 80 G of the Income Tax Act, 1961 ( in short ‘the Act) has been rejected, on the ground of limitation.
2. The assessee Trust was earlier granted provisional registration. However, the final registration of the assessee Trust was rejected by the ld.CIT(E) observing that as per clause (iii) of first proviso to sub-section (5) of Section 80G of the Act, the assessee Trust was required to apply for final registration atleast six months prior to the expiry of the period of provisional approval or within six months of commencement of its activities, whichever is earlier.
3. The ld.CIT(E) observed that the last date for application was extended vide CBDT Circular No.8/2022 upto 30.09.2022. He further observed that as per the submissions of the assessee, the assessee has already commenced its activities during Financial Year 2020-21, however, the present application was filed by the assessee on 05.01.2023 which was even after the last date for making application as extended by the CBDT. He therefore, rejected the application of the assessee being barred by limitation.
4. At the outset, ld. Counsel for the assessee has invited our attention to various documents placed on the file to show that the assessee had duly tried to upload the application electronically before the due date, however, there was a technical glitch on the website/portal of the Income Tax Department due to which the assessee could not upload the application for final registration. The assessee has duly communicated about the aforesaid technical glitch to the Income Tax Department and regarding the inability of the assessee to upload the application. The assessee in this respect has referred to various e-mails and even has referred to the response received from the Help Desk that they were looking into the matter and further advised the assessee Trust to re-try the uploading of the application. The ld. Counsel for the assessee has submitted that the delay in uploading the application was not intentional but due to the aforesaid circumstances. He, in this respect has referred to Paper Book page 1 to 6 to show that he has also raised alleged grievance with the Grievance Cell of the Income Tax Department. The aforesaid evidences on the file show that the assessee had duly tried to upload the application for final registration u/s 80G(5) of the Act within the extended period of limitation. However, the same could not be uploaded due to certain technical glitches, therefore, under the circumstances, the dismissal of the application on the ground of being barred by limitation by the ld.CIT(E) is not justified. The impugned order of the ld.CIT(E) is, therefore, set aside and the matter is restored to the file of the CIT(E) to decide the application of the assessee for final registration on merits after giving adequate opportunity to the assessee to present its case, irrespective of the fact that there was any delay in uploading the application.
5. The appeal of the assessee is treated as allowed for statistical purposes.
Order pronounced on 15th February, 2024.
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