Appeal Allowed: Approval under Section 80G Perpetual Post-2009

The Tribunal allowed the appeal against the rejection of renewal of approval under Section 80G of the Income-tax Act. It held that approvals granted after 1st October, 2009, are valid perpetually unless withdrawn, as clarified by a CBDT circular. The Tribunal concluded that the appellant was not required to seek renewal post the omission of a proviso, and the rejection was deemed invalid. The approval granted to the charitable institution was upheld to be extended perpetually, leading to the allowance of the appeal.

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Issues:
- Appeal against rejection of renewal of approval u/s 80G(5)(vi) of the Income-tax Act, 1961.
- Interpretation of statutory provisions regarding the renewal of approval u/s 80G.
- Application of Circular No.7/2010 by the CBDT regarding the validity of approvals granted u/s 80G.

Analysis:

1. The appeal was filed against the rejection of the renewal of approval u/s 80G(5)(vi) of the Income-tax Act, 1961. The assessee, a charitable institution, had applied for renewal on 27th December, 2010, after enjoying approval from 1.4.2007 to 31st March, 2010. The Director of Income-tax (Exemptions) (DIT (E)) rejected the renewal application on 13th July, 2011, citing the absence of certain required details.

2. The appellant argued that the proviso to Section 80G(5)(vi) was omitted by the Finance (No.2) Act, 2009, implying that approvals granted after 1st October, 2009, would be valid in perpetuity unless specifically withdrawn. The Circular No.7/2010 by the CBDT clarified this, stating that approvals expiring after 1st October, 2009, are deemed extended perpetually, unless withdrawn. The appellant cited a relevant judgment by the Allahabad High Court supporting this interpretation.

3. The DIT (E) contended that the renewal application was rightly rejected due to the lack of substantiating details. However, the Tribunal analyzed the statutory provisions and the CBDT circular, emphasizing that the approval granted to the assessee would continue in perpetuity unless withdrawn. As there was no evidence of withdrawal of approval, the Tribunal held that the rejection of the renewal application was not valid.

4. The Tribunal concluded that the appellant was not obligated to seek renewal as per the statutory provisions post the omission of the proviso to Section 80G(5)(vi). The approval granted to the assessee was deemed to be extended perpetually, and the rejection of the renewal application was vacated. The appeal was allowed in favor of the assessee, affirming the perpetual validity of the approval granted under Section 80G.

5. In summary, the Tribunal's decision was based on the interpretation of statutory provisions, the CBDT circular, and relevant case law, emphasizing that approvals under Section 80G granted after 1st October, 2009, are deemed to be extended perpetually unless specifically withdrawn, leading to the allowance of the appeal against the rejection of the renewal application.

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