ITAT grants Section 80G(5) final approval after CIT(E) rejection for delayed Form 10AB filing

The ITAT Ahmedabad allowed the assessee's appeal regarding Section 80G(5) final approval. The CIT(E) had rejected the application citing delay in filing Form 10AB beyond the September 30, 2022 deadline. However, the ITAT found that the assessee filed within six months of provisional registration granted on March 30, 2023, and the deadline was extended to June 30, 2024 via Circular 7/2024. Following the Chennai ITAT precedent in Periyar Maniammai Academy case, the tribunal held that timeline extensions for Section 12A should apply to Section 80G(5) renewals as well. Since the CIT(E) had already granted final approval under Section 12AB based on the same facts, the ITAT concluded there was no substantive reason to deny Section 80G(5) final registration.

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Issues Involved:
1. Refusal to grant approval u/s 80G(5) of the Income Tax Act, 1961.
2. Interpretation of timelines for filing Form 10AB for approval under Section 80G(5).

Summary:

Issue 1: Refusal to Grant Approval u/s 80G(5)
The Assessee appealed against the Ld. Commissioner of Income Tax (Exemptions), Ahmedabad's order refusing approval u/s 80G(5). The Assessee Trust, incorporated on 01.05.2007, applied for final approval under Section 80G(5)(iii) in Form No. 10AB on 06.05.2023, after receiving provisional approval on 06.04.2023. The CIT(E) rejected the application, stating it was filed beyond the prescribed timeline of 30.09.2022, as per Circular No. 8/2022 and Circular No. 6/2023. The CIT(E) assumed the date of commencement of activities as the date of incorporation, thus requiring the application to be filed by 30.09.2022.

Issue 2: Interpretation of Timelines for Filing Form 10AB
The Tribunal examined whether the timeline for filing Form 10AB for approval under Section 80G(5) could be extended similarly to the timeline for Section 12AB registrations. The Tribunal referenced the ITAT ruling in the case of Adani Education Foundation, which held that there should be no distinction in timelines for filing applications under Section 12AB and Section 80G(5). The Tribunal also cited other cases, including the Chennai ITAT's decision in Periyar Maniammai Academy of Higher Education and Research, which supported the extension of timelines due to genuine hardships faced in electronic filings.

Conclusion:
The Tribunal concluded that the Assessee Trust, having filed the application within six months of receiving provisional approval, should be granted final registration under Section 80G(5). The Tribunal set aside the CIT(E)'s order and remanded the matter for re-evaluation on merits, considering the extended timelines and the consistency in granting approvals under similar circumstances. The appeal was allowed for statistical purposes, and the Assessee was deemed eligible for final registration under Section 80G(5).

Order Pronounced:
The order was pronounced in Open Court on 30/04/2024.

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