Condonation of delay in registration applications requires reasonable cause, evidence review and a fresh hearing on merits.

Proviso to clause (ac) of section 12A(1) permits the Principal Commissioner or Commissioner to condone delay in filing an application for registration where a reasonable cause is shown; the discretionary power requires consideration of factual materials, relevant documents and an opportunity of hearing. In the present facts provisional registration existed and the applicant filed with a short delay after an administrative relaxation; the Tribunal concludes the Commissioner has jurisdiction to condone delay and directs remand for fresh decision on merits, requiring the authority to consider the administrative circular and supporting material and to grant a reasonable hearing.

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Issues: (i) Whether delay in filing application for registration under section 12A(1)(ac) can be condoned by the Commissioner in view of the proviso inserted w.e.f. 01.10.2024 and related facts including CBDT circular relaxation; and (ii) whether the matter should be remitted for fresh decision after condonation.

Analysis: The legal framework comprises clause (ac) of section 12A(1) of the Income-tax Act, 1961 which requires application for registration in the prescribed form and includes a proviso empowering the Principal Commissioner or Commissioner to condone delay if there is a reasonable cause. The record discloses provisional registration and an application filed with a short delay after the period for which CBDT Circular No. 7/2024 dated 25.04.2024 had given relaxation. The discretionary power under the proviso to condone delay is applicable where reasonable cause is shown; the appropriate exercise of that discretion requires consideration of the facts, relevant documents and opportunity of hearing. The Tribunal found that the Commissioner has jurisdiction to condone the delay and that, given the factual materials and the CBDT circular, the matter ought to be reconsidered with an opportunity to the applicant to furnish evidence and submissions.

Conclusion: (i) The delay in filing the registration application is capable of being condoned under the proviso to section 12A(1)(ac) and the matter is remitted for fresh decision on merits after condoning delay where appropriate; (ii) The remand is directed with a requirement to grant reasonable opportunity of hearing and consider the CBDT circular and other supporting material. This conclusion is in favour of the assessee.

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