Registration under Section 80G: Tribunal directs delay condonation and remand for fresh merit hearing treating application as filed in time

Application for registration under section 80G was rejected administratively as time-barred after an initial in-time filing was dismissed for statistical reasons; the decision finds that refiling shortly after that rejection caused the delay and constitutes sufficient cause. The matter is set aside and remanded with directions to treat the second application as filed within time, to condone the delay, and to decide the registration application afresh on merits after affording a reasonable opportunity of hearing. The grounds urged by the applicant are allowed for statistical purposes.

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Issues: Whether the delay in filing the second Form No.10AB application under clause (iii) of the first proviso to section 80G(5) of the Income-tax Act, 1961 should be condoned and the application treated as filed in time so that the application may be decided on merits.

Analysis: The statutory framework for timing of regular approval where provisional approval exists is set out in clause (iii) of the first proviso to section 80G(5) of the Income-tax Act, 1961 and the extended filing date provided by CBDT Circular No. 7/2024. The assessee filed an initial Form 10AB within the extended period but that application was rejected for statistical reasons without adverse inference; a second application was filed thereafter which was held time-barred by the authority. On the facts, the initial timely filing and its rejection for statistical purposes constitute a sufficient cause leading to the delay in refiling. A coordinate decision of the Tribunal treating similar facts as warranting condonation and directing fresh decision on merits is available and the relevant principle requires that limitation should not automatically defeat examination of merits where sufficient cause exists. The assessee is entitled to an opportunity to furnish required details/documents and have the application decided on the merits after condonation of delay.

Conclusion: Delay in filing the second Form No.10AB is condoned; the matter is remanded to the Commissioner of Income Tax (Exemption) to treat the application as filed in time and decide the application afresh on merits after providing a reasonable opportunity of hearing to the assessee.

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