Trust wins appeal after Section 80G registration rejected for incorrect clause mention deemed rectifiable mistake

ITAT Kolkata allowed the appeal regarding Section 80G registration rejection. The trust's application was rejected due to incorrect clause mention, which the tribunal held was a rectifiable mistake rather than illegality. The CIT(E) should have allowed correction instead of requiring fresh application withdrawal. The tribunal condoned the delay, directing that the revised application be treated as timely filed. Following precedent in West Bengal Welfare Society case, the tribunal held that provisional registration holders can apply for final registration regardless of prior activity commencement. Matter remanded to CIT(E) for merit-based decision.

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Issues:
The appeal against the rejection of the application for registration under section 80G of the Income Tax Act, 1961.

Grounds of Appeal:
1. The rejection of the application under section 80G(5)(iii) was erroneous.
2. The rejection was arbitrary, unjustified, and unwarranted.
3. The rejection based on the application date not meeting the deadline was incorrect.
4. Request for reconsideration of the application based on the subsequent submission.
5. Provision to modify grounds of appeal before the hearing date.

Facts:
The appellant, a charitable institution, had prior approvals under sections 12A and 80G of the Act. Due to an amendment, a reapplication for approval under section 80G was necessary. The appellant received provisional approval and subsequently applied for final approval, but a technical error led to the withdrawal and refiling of the application. The rejection was based on the application deadline and a mistaken clause reference.

Judgment:
The rejection of the final approval application was deemed unjust due to technical reasons beyond the appellant's fault. The appellant had complied with all requirements promptly, and the error was rectifiable. The delay in refiling the application was condoned, and the application was to be treated as filed within the prescribed time limit. The matter was remanded for a fresh decision, disregarding the delay.

Legal Interpretation:
The Tribunal clarified that the appellant, having received provisional approval, was eligible for final registration, regardless of prior activity commencement. The provision required provisional approval before applying for final registration. The Tribunal emphasized that the appellant's actions were in line with statutory requirements, and there was no delay in the application process.

Conclusion:
The appeal was allowed for statistical purposes, and the case was remanded for a fresh decision on the application for final registration under section 80G of the Income Tax Act, 1961.

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