Navajivan Gramvikas Pratishthan Vs ITO (Exemption) (ITAT Mumbai)
Summary: A trust seeking approval under section 80G selected the wrong clause in its electronic Form 10AB. Its attached certificate showed provisional 80G approval, while the clause selected in the application called for a copy of regular approval. The Commissioner of Income Tax (Exemptions) rejected the application on that basis without examining the trust’s objects or activities.
The Mumbai Tribunal held that this curable procedural error warranted an opportunity to correct the application. It set aside the rejection and sent the matter back for a decision under the appropriate provision. The Tribunal did not grant 80G approval; the trust’s eligibility remains to be examined.
The Mismatch in the Application
Navajivan Gramvikas Pratishthan filed Form 10AB on 29 September 2025 seeking approval under section 80G. The application was made by selecting a clause for which the Commissioner expected the trust to furnish a copy of its regular 80G approval in Form 10AC.
The document the trust actually submitted was different. It held a provisional approval certificate under section 80G and attached that certificate to its application. On examining the selected clause and the accompanying document, the Commissioner found that the required regular approval certificate had not been furnished. He rejected the application by order dated 27 March 2026.
The error was thus visible from the application itself: the electronic selection indicated one route, while the certificate supplied indicated another. Before the Tribunal, the trustee described the selection as inadvertent and bona fide. He argued that the trust’s intention was to have its eligibility for 80G approval considered and that the mistaken selection should have been capable of correction.
What the Trust Asked the Tribunal to Do
The trust did not ask the Tribunal to treat the provisional certificate as though it were a regular approval certificate. Its case was that the Commissioner should either have considered the application under the appropriate provision or given it an effective chance to rectify the selection in Form 10AB.
It submitted that a wrong choice of clause in an electronic form was a procedural defect, particularly when the attached document disclosed the true position. The trustee sought a fresh examination of the application on its merits. The trust relied on Pune Tribunal decisions in Infant India, Beed v. CIT(E) and Skilletz Foundation v. CIT(E), where similar form-related issues had arisen.
The department supported the rejection order. The question for the Mumbai Tribunal was therefore whether the mismatch justified ending the application at the threshold, or whether the trust should have been permitted to correct it and proceed under the proper route.
No Adverse Finding on the Trust’s Activities
The Tribunal observed that the Commissioner had rejected the application only on technical grounds. He had not examined its substantive merits or recorded an adverse finding against the trust’s activities.
The material before the Tribunal also showed that the trust held a section 12A registration certificate valid from AY 2022–23 to AY 2026–27. That certificate did not automatically establish entitlement to 80G approval. It was, however, part of the background against which the Tribunal considered whether a curable selection error should prevent the application from receiving substantive examination.
The Tribunal held that procedural and technical lapses capable of rectification should not obstruct the adjudication of substantive rights. Where an error can be corrected, natural justice requires a reasonable opportunity before an adverse decision is taken. In this case, no effective opportunity appeared to have been given to the trust to correct the clause selected and pursue its application under the applicable provision.
Referring particularly to the Pune Tribunal’s decision in Infant India, Beed, the Mumbai Bench found a remand appropriate in materially similar circumstances.
What Happens on Remand?
The Tribunal set aside the Commissioner’s rejection order and restored the matter for fresh adjudication on merits. It directed the Commissioner to provide an adequate opportunity for the trust to rectify the defect, consider the application under the appropriate provisions and then decide it in accordance with law.
That fresh examination must include the relevant facts, the objects of the trust and the genuineness of its activities. The Commissioner is therefore required to go beyond the form-selection error, but remains responsible for deciding whether the statutory requirements for 80G approval are met.
The appeal was allowed for statistical purposes. In practical terms, the trust has regained the opportunity to pursue its application; it has not yet obtained approval under section 80G.
Author’s Comments
This ruling addresses a common problem with electronic applications: the selected clause and the uploaded supporting document may point to different statutory routes. Here, the provisional approval certificate made the mismatch apparent. The Tribunal considered it appropriate to let the trust correct that selection before its application was rejected for failing to provide a regular approval certificate it did not claim to hold.
The decision should be read for its procedural relief. It does not say that every mistake in Form 10AB must be ignored, or that an existing section 12A certificate guarantees 80G approval. It requires an effective chance to cure this error and a fresh decision on the trust’s actual eligibility.
Cases Discussed
- Infant India, Beed v. CIT(E), Pune, ITA No. 3196/PUN/2025 (ITAT Pune) — Relied upon by the assessee and specifically followed by the Tribunal. In materially identical circumstances, the Pune Bench had remanded the matter to the CIT(E) for fresh consideration on merits.
- Skilletz Foundation v. CIT(E), Pune, ITA Nos. 1797 & 1798/PUN/2025 (ITAT Pune) — Relied upon by the assessee in support of its contention that an erroneous selection of the clause/sub-clause in Form 10AB is a curable procedural defect.
FULL TEXT OF THE ORDER OF ITAT MUMBAI
The captioned appeal by the assessee arises from rejection by the Ld. Commissioner of Income tax (Exemption) [in short, CIT(E)] of assessee’s application in Form 10AB for approval under section 80G(5) of the Income tax Act, 1961 (‘the Act’).
The grounds of appeal are as under :-
i. That the learned CIT(Exemption), Pune erred in law and on facts in rejecting the application filed by the appellant for approval under section 80G(5) of the Income-tax Act, 1961 vide order dated 27.03.2026.
ii. That the learned CIT(Exemption), Pune erred in rejecting the application merely on technical grounds without appreciating that due to inadvertent and bona fide error, the application in Form No.10AB came to be filed under an incorrect clause/sub-clause and such procedural defect could not have been made a ground to deny substantive approval.
iii. That the learned CIT(Exemption), Pune failed to appreciate that the appellant trust was otherwise eligible for consideration of approval under section 80G(5) and no adverse finding has been recorded regarding the genuineness of activities or violation of statutory conditions prescribed under the Act.
iv. That the impugned order passed by the learned CIT (Exemption), Pune is contrary to the settled position of law consistently laid down by the Hon’ble ITAT, Pune wherein it has been held that rejection of application merely due to wrong selection of clause/sub-clause in Form No. 10AB is not justified.
v. That the learned CIT(Exemption), Pune erred in rejecting the application without granting proper and effective opportunity to the appellant for explaining and curing the technical defect, thereby rendering the impugned order arbitrary, unjustified and bad in law.
vi. That the appellant therefore prays that the impugned order be set aside and the matter be restored to the file of the learned CIT (Exemption), Pune for fresh adjudication in accordance with law after granting reasonable opportunity of being heard.
vii. That the appellant craves leave to add, alter, amend or modify any of the above grounds of appeal at the time of hearing.
2. The facts of the case are that the assessee had filed an application in Form 10AB for approval u/s 80G(5)(ii) on 29/09/2025. On verification of the details/documents submitted by the assessee along with its application, the Ld. CIT(E) noted that the assessee had not furnished copy of the Regular Approval in Form 10AC u/s 80G(5)(vi) read with clause (i) or clause (iii) of first proviso to sub-section (5) of Section 80G of the Act. Instead, it had submitted a copy of Provisional Approval u/s 80G(5)(vi) read with clause (iv) of the first proviso to sub-section (5) of section 80G. In view of the above, the Ld. CIT(E) rejected the application, holding that the assessee has failed to fulfil the pre-requisites of the provisions of 80G(5)(i) nof the Act.
3. Aggrieved by the order of the Ld. CIT(E), the assessee is in appeal before this Tribunal.
4. Before us, Shri Ravinatra Khanat, Trustee, submitted a Paper Book containing relevant details that they wished to rely on in support of their claim that their application should not have been rejected. In the Synopsis contained in the Paper Book, it has been contended that the wrong selection of the clause in Form No. 10AB was an inadvertent and bona fide procedural error, apparent from the documents already furnished with the application. It was submitted that the substantive claim of the assessee was for consideration of his eligibility for approval u/s 80G, and such substantive right could not reasonably be denied because of an erroneous selection of the procedural clause in an electronically filed Form. The defect, according to him, was clearly curable, and the Ld. CIT(E) should have either considered the application under the appropriate provision of law, or he should at least have granted an effective opportunity to the assessee to rectify the defect. It was, therefore, requested that the matter may be set aside to the file of the CIT(E) to consider the assessee’s application afresh on merits.
4.1 It was also submitted on behalf of the assessee that it’s case is directly supported by the following decisions:-
a) Hon’ble ITAT, Pune Bench, in Infant India, Beed v. CIT(E), Pune, reported in ITA No. 3196/PUN/2025; &
b) Hon’ble ITAT, Pune Bench, in Hon’ble ITAT, Pune Bench, Skilletz Foundation v. CIT(E), Pune, ITA Nos. 1797 & 1798/PUN/2025.
5. Per contra, the CIT DR supported the order of the Ld. CIT(E).
6. We have considered the submissions of both the parties in the light of the material placed on record. Admittedly, the Ld. CIT(E) rejected the assessee’s application only on technical grounds, without considering the merits of the case, and without drawing any adverse inference against the assessee. It is also evident from the Paper Book submitted by the assessee that it had a valid section 12A registration certificate subsisting from A.Y. 2022-23 to A.Y. 2026-27. In our considered opinion, procedural and technical lapses should not come in the way of adjudicating substantive rights, especially where such lapses are capable of being rectified. The principles of natural justice require that where a defect is curable in nature, a reasonable opportunity should be afforded to the assessee before taking an adverse decision against it. In our case, no such effective opportunity appears to have been granted to the assessee for correcting the mistake and pursuing its application under appropriate provisions of law.
7. Under materially identical circumstances, the Pune Bench of ITAT, in Infant India, Bead (supra) had remanded the matter to the Ld. CIT(E) for fresh consideration on merits. Considering the entirety of the facts and circumstances, and in the greater interest of justice, we deem it fit and proper to set aside the impugned order and restore the matter to the file of the Ld. CIT(E) for fresh adjudication on merits. The Ld. CIT(E) is directed to provide adequate opportunity to the assessee to rectify the impugned defect, consider the application under appropriate provisions, and thereafter decide the issue in accordance with law after examining all relevant facts, including the objects of the trust and the genuineness of its activities.
8. The grounds raised by the assessee are, accordingly, allowed for statistical purposes.
9. In the result the appeal filed by the assessee is allowed for statistical purposes.
Order pronounced in the open Court on 24/09/2026
