Charitable Trust Allowed to Rectify Application Error for Permanent Registration Pursuit u/s 80G(5.

The Tribunal remanded the case to the Ld. CIT(E) to permit the assessee, a Charitable Trust, to rectify its application error under section 80G(5) of the Act. Despite the initial rejection due to a wrong section code, the Tribunal emphasized procedural diligence and the CBDT's extension of due dates. The assessee was instructed to cooperate by providing necessary details, leading to the appeal being allowed for statistical purposes, favoring the assessee's pursuit of permanent registration.

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Issues:
1. Rejection of application for registration under section 80G(5) of the Act.
2. Dispute over the selection of the wrong section code in the application.
3. Consideration of the timeline for filing the application and extension of the due date.
4. Failure to cross-verify details submitted by the assessee for provisional registration.
5. Decision on allowing the assessee to rectify the mistake and apply for permanent registration.

Analysis:
The case involves the rejection of the assessee's application for registration under section 80G(5) of the Act by the learned Commissioner of Income Tax (Exemption) ("Ld. CIT(E)"). The assessee, a Charitable Trust, had initially obtained approval under section 80G(5) of the Act in form 10AC, valid till the Assessment Year 2024-25. Subsequently, the assessee filed Form No.10AB, which was rejected by the Ld. CIT(E) as infructuous and barred by limitation due to the selection of the wrong section code (80G(5)(iv) instead of 80G(5)(i)).

The assessee contended that the selection error was unintentional, citing a Tribunal decision that rejected an application based on the wrong form selection. However, the Ld. CIT(E) maintained the rejection, stating that the decision cited was specific to that case. The Tribunal noted that the assessee's provisional registration was granted despite the error, and the due date for application submission was extended by the CBDT.

The Tribunal found that while the assessee erred in the initial application, permanent registration should not be denied solely for this mistake. It highlighted the CBDT's extension of the due date for form submissions and emphasized the need for cross-verifying details at the provisional registration stage to rectify errors promptly.

Referring to a similar case, the Tribunal decided to remand the issue to the Ld. CIT(E) to allow the assessee to rectify the mistake and consider the application for permanent registration. The assessee was directed to cooperate and provide necessary details for the expedited resolution of the case. The appeal was treated as allowed for statistical purposes, indicating a favorable outcome for the assessee.

In conclusion, the judgment addresses the importance of procedural diligence in verifying application details, the impact of selection errors on registration applications, and the need to facilitate rectification of genuine mistakes to ensure fair consideration for registration under relevant provisions of the Act.

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