Charitable exemption dispute over return filing timing: belated return within permitted period upheld, exemption directed to be allowed.

Challenge concerned denial of charitable exemption under the Income Tax regime due to alleged noncompliance with filing conditions. The tribunal held that insertion of an additional condition required registered entities to furnish a return within the time permitted under the return provisions, and a return filed under the provision allowing belated returns qualifies as a valid return for that purpose; consequently a belated return filed within the statutory belated period satisfied the registration condition and the exemption could not be denied on that ground, directing grant of the exemption to the assessee society.

---

---

Issues: (i) Whether a trust registered under Section 12A that filed its return after the due date under Section 139(1) but within the time allowed for belated return under Section 139(4) is entitled to claim exemption under Section 11 of the Income-tax Act, 1961 in view of insertion of clause (ba) in Section 12A(1) and related CBDT circular.

Analysis: The legal framework comprises Section 11 (exemption), Section 12A(1)(ba) (condition of furnishing return within the time allowed under Section 139), and the provisions of Section 139 including sub-sections (1) and (4). The CBDT circular dated 23/04/2019 and persuasive coordinate-bench authority interpret the requirement in Section 12A(1)(ba) as referring to Section 139 generally, and not exclusively to Section 139(1), thereby including returns filed within the time allowed for belated returns under Section 139(4). The return in the present case was filed within the period permitted for filing a belated return under Section 139(4). The procedural lapse of delayed filing of Form 10B was treated as curable and was not relied upon to deny exemption. Applying a beneficial construction and following the CBDT circular and coordinate-bench precedent, the condition in Section 12A(1)(ba) is satisfied when the return is filed within the time allowed under Section 139, inclusive of Section 139(4) belated returns.

Conclusion: The assessee satisfied the condition in Section 12A(1)(ba) by filing the return within the time allowed under Section 139; therefore the exemption under Section 11 is to be allowed in favour of the assessee.

Ratio Decidendi: Section 12A(1)(ba) requires filing the return within the time allowed under Section 139, and this requirement is satisfied by returns filed under Section 139(4); hence such belated returns are valid for claiming exemption under Section 11.

---