Appeals allowed; permit amendment of clause and decide registration applications under Sections 12AB and 80G on merits

ITAT, Indore (AT) allowed the appeals, setting aside the CIT(E) order that denied registration u/s 12AB and 80G. The tribunal found the applicant had filed under incorrect clause but provided full details and sought correction; the filing error was not fatal. The CIT(E) was directed to permit amendment of the relevant clause/sub-clause in the application and to decide the registration applications on their merits in accordance with law. Appeals are allowed for statistical purposes.

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Issues: (i) Whether the delay in filing the appeals should be condoned and the appeals admitted despite being filed after the prescribed period; (ii) Whether the rejection of applications for registration under Sections 12AB and 80G on account of incorrect clause/section codes (clerical/technical errors) without issuance of show cause notice or an opportunity to rectify was sustainable, and whether the matter should be remitted for fresh adjudication allowing amendment/correction and hearing.

Issue (i): Whether the delay of 46 days in filing the appeals before the Tribunal is to be condoned.

Analysis: The reasons for delay were clerical/technical errors by the prior tax consultant, the assessee deposited appeal fees within a short period, and there was no indication of deliberate or mala fide delay. The materials accompanying the affidavit and the explanation for change of counsel were considered as sufficient cause under the statutory provision for extension of time.

Conclusion: Delay of 46 days is condoned and the appeals are admitted in the interest of justice (in favour of the appellant filing the appeals).

Issue (ii): Whether rejection of registrations under Sections 12AB and 80G for incorrect clause/section codes without issuing show cause notice or affording opportunity to cure defects was correct, and whether the matter should be remitted for fresh consideration permitting rectification.

Analysis: The applications contained all substantive information required for registration and the incorrect clause/section entry resulted from inadvertent/clerical mistakes by the previous consultant. No show cause notice was issued and no opportunity was afforded to explain or amend the application. Under these circumstances, the defect was curable and the matter falls within principles allowing correction of procedural errors and remand for adjudication on merits with an opportunity of hearing.

Conclusion: The order of rejection is set aside; the matter is remitted to the Commissioner for reconsideration on merits after permitting rectification/amendment of the application and after granting a reasonable opportunity of hearing (conclusion in favour of the appellant).

Final Conclusion: The Tribunal condoned the delay, admitted the appeals, set aside the Commissioners rejection, and directed remand for fresh adjudication permitting amendment of the application and affording opportunity of hearing; the appeals are allowed for statistical purposes.

Ratio Decidendi: Where an application for registration under Sections 12AB and 80G is rejected solely due to inadvertent or clerical errors in clause/section entries and the applicant has otherwise furnished requisite details, the defect is curable; the proper course is to permit rectification and remit the matter for fresh adjudication after giving a reasonable opportunity to the applicant.

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