TaxTMI 
TaxTMI 
2024 (3) TMI 614
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....ing that the application was filed within six months of commencement of activities as per clause (iii) of first proviso to sub-section 5 of section 80G. 3. On the facts and in circumstances of the case as well as law on the subject, the learned Commissioner of Income Tax (Exemption) has erred in not considering that the date of commencement of activities is 07.11.2022 when the agreement was entered to pursue the objectives of the Trust. 4. On the facts and circumstances of the case as well as law on the subject, the learned Commissioner of Income Tax (Exemption) has erred in rejecting application for registration u/s. 80G(5) without considering the issues on merits. 5. Alternatively, on the facts and in circumstances of the case as well as law on the subject, the learned Commissioner of Income Tax (Exemption) has erred in not condoning the delay 6. Appellant craves leave to add, alter or delete any ground(s) either before or in the course of hearing of the appeal." 3. The relevant material facts, as culled out from the material on record, are as follows: An application for approval of the trust under clause (iii) of first proviso to sub-section (5) of section 80G of the I.....
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....80G of the Act has been substituted by the Finance Act 2023, w.e.f. 01/10/2023 and prior to said substitution, the said sub-clause (iv) of first proviso to sub-section (5) of section 80G of the Act read as under. (iv) in any other case, at least one month prior to commencement of the previous year relevant to the assessment year from which the said approval is sought:," 4. From the above, the ld CIT(A) noted that it is evident that the provisions of section 80G(5) of the Act, prescribed various time limit within which the assessee is required to file application for approval of Trust/Institution/Fund depending upon the various circumstances mentioned therein. In the present case, the assessee is Provisionally approval u/s. 80G(5) of the Act as applicable from 01/04/2021 and therefore the assessee was required to file application in Form No. 10AB under clause (iii) of first proviso to sub-section (5) of section 80G of the Act, within the time period of at least six months prior to expiry of period of the provisional approval or within six months of commencements of its activities, whichever is earlier. From the provisions of section 80G(5) of the Act, it is evident that the time ....
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....ion 12A of the Act, till 30.09.2023 where the due date for making such application has expired prior to such date." 5. From the above, ld CIT(E) noted that it is evident that the time limit prescribed u/s. 80G of the Act for filing Form No.10A and 10AB, as the case may be is mandatory and therefore, after considering the hardship to the assessee, the CBDT extended the said time limit on multiple occasions, for filing Form No. 10A and 10AB, u/s. 119 of the Act, vide above referred Circulars. As per above referred CBDT Circular No. 8/2022 dated 31/03/2022, the assessee, whose last date for filing Form No. 10AB for registration/approval under section 10(23C), 12A or 80G of the Act was falling on or before 29th September, 2022, was extended upto 30th September, 2022. Thereafter, in order to mitigate the genuine hardship, the CBDT vide Circular No. 6/2023 dated 24/05/2023, further extended the due date for filing Form No. 10AB for registration under clause (iii) of the first proviso to clause (23C) of section 10 or under sub-clause (iii) of clause (ac) of subsection (1) of section 12A of the Act, till 30.09.2023. However, no further extension for delay in filing Form No. 10AB, under cl....
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....stitution or fund referred to in clause (vi) shall make an application in the prescribed form and manner to the Principal Commissioner or Commissioner, for grant of approval,- (i) (ii) (iii) where the institution or fund has been provisionally approved, at least six months prior to expiry of the period of the provisional approval or within six months of commencement of its activities, whichever is earlier; (iv)......" 3) Our Trust was formed on 15/03/2021 and in the subsequent year the Trust had made the payment towards Advocate Fees in connection with its formation expenses and other general expenses out of donations obtained in this regard. The particulars of the expenses are enclosed herewith. 4) Thereafter, in order to pursue its objectives the trust has entered into Service Agreement on 07/11/2022 for E Waste Management with Akrishyam Recyclers. Copy of the same is attached herewith. 5) Thereafter, we filed the Form 10AB on 02/12/2022. 6) Your honour has rightly observed that the Trust had received donation and had shown application of the funds towards the object of the Trust. However, as stated above, the trust received the Donations in order to make the paym....
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....ate of commencement of activities. Hence, trust has field the application in Form 10AB, on 02/12/2022, which is well within the due date, i.e. within Six months of the date of commencement of activities, hence there is no any delay in filing application in Form No.10AB under section 80G(5) (iii) of the Act, hence ld Counsel prays the bench that ld CIT(E ) may be directed to grant the approval under section 80G(5) (iii) of the Act. 11. In alternative argument, ld Counsel submitted that if the Tribunal considers delay in filing the application in Form 10AB under section 80G(5)(iii) of the Act, then the same may be condoned, as the Tribunal has power to condone the delay, and the ld. CIT(E) may be directed by the Tribunal to adjudicate the issue afresh on merit. 12. We have heard both the parties and carefully gone through the submissions put forth on behalf of the assessee along with the documents furnished and the case laws relied upon, and perused the facts of the case including the findings of the ld. CIT(E) and other material brought on record. We note that the issue under consideration, is covered by the order of Co-ordinate Bench in the case of Vananchal Kelavani Trust vs. CI....
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....September, 2022." 16. Thus, in the Circular No.8/2022 dated 31.03.2022, cited above, there is mention about Section 80G of the Act (in form No. 10AB) for registration or approval and extended date is mentioned as 30.09.2022. However, in the latest Circular No.6/2023 dated 24.05.2023, the CBDT did not clarify or did not mention about the extension of the time limit for Section 80G (5) of the Act, (in form No. 10AB). Therefore in the situation, it is difficult to interpret clause (iii) the 3rd proviso of Section 80G(5) of the Act, which states as follows: "where the institution or fund has been provisionally approved, at least six months prior to expiry of the period of the provisional approval or within six months of commencement of its activities, whichever is earlier." Therefore, it is undue hardship to the assessee, as the CBDT, in the latest Circular No.6/2023 dated 24.05.2023, about application for registration or approval under Section 80G, in form No. 10AB, did not mention the extended period. Thus, we find merit in the submission of ld Counsel to the effect that assessee is an old trust, which had registered on 29.11.2001 and commenced its activities from 2001, therefo....
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....y formed Trust/institutions. For the existing Trust/Institution, the time limit for applying for Regular Registration is within six months of expiry of Provisional registration if they are applying under sub clause (iii) of the Proviso to Section 80G(5) of the Act. This will be the harmonious interpretation. 11. If we agree with the interpretation of the ld.CIT(E), then say a trust which was formed in the year 2000, performed charitable activities since 2000, but did not applied for registration u/s. 80G, the said trust will never be able to apply for registration now. This in our opinion is not the intention of the legislation. This interpretation leads to absurd situation. 11.1 In this context, we will like to refer to observations of the Hon'ble Supreme Court in the case of K P Varghase(supra), where in Hon'ble SC observed as under : Quote, "It is a well-recognised rule of construction that a statutory provision must be so construed, if possible, that absurdity and mischief may be avoided. There are many situations where the construction suggested on behalf of the revenue would lead to a wholly unreasonable result which could never have been intended by the Legislature. Ta....
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....ean-while, the market price has shot up and exceeds the agreed price by more than 15 per cent. Many other similar situations can be contemplated where it would be absurd and unreasonable to apply section 52(2) according to its strict literal construction. We must, therefore, eschew literalness in the interpretation of section 52(2) and try to arrive at an interpretation which avoids this absurdity and mischief and makes the provision rational and sensible, unless of course, our hands are tied and we cannot find any escape from the tyranny of the literal interpretation. It is now a well-settled rule of construction that where the plain literal interpretation of a statutory provision produces a manifestly absurd and unjust result which could never have been intended by the Legislature, the Court may modify the language used by the Legislature or even 'do some violence" to it, so as to achieve the obvious intention of the Legislature and produce a rational construction -" Unquote. 11.2 Thus, as observed by Hon'ble Supreme Court, that the statutory provision shall be interpreted in such a way to avoid absurdity. In this case to avoid the absurdity as discussed by us in earlier pa....
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....d of the provisional approval.." has not been adjudicated. 19. Now the next question before us is that whether Tribunal has power to condone the delay in filing the Form No.10AB, u/s. 80G(5) of the Act. The Tribunal is a final fact finding authority, and based on the assessee`s facts and undue hardship created by the clause (iii) of 3rd proviso of section 80(5) of the Act, the Tribunal may condone the delay in filing the Form No.10AB, u/s. 80G(5) of the Act. Therefore, we are of the view that delay in filing the Form No.10AB, u/s. 80G(5) should be condoned in the interest of justice. For that we rely on the judgment of Hon'ble Delhi High Court in the case of DCIT(Exemption) vs. Vishwa Jagriti Mission [2013] 30 taxmann.com 41 (Delhi)/[2013] 213 Taxman 65 (Delhi), wherein the Hon'ble Delhi High Court held as follows: "18. The main question that falls for our consideration is whether the Tribunal was justified in condoning the delay in the filing of the application for registration under section 12A of the Act and whether the view taken by the Tribunal is perverse. The question whether there was sufficient cause for the delay is always a question of fact as has been held by two Di....
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.... filed with the income tax authorities for registration. The assessee-society was thus under the belief, though mistaken but honest, that there was no delay and once it came to know on 06.12.2005 about the irregularities on a complaint from M.P. Mansinghka Trust of Mumbai and on further enquiry conducted on 14.12.2005 by the governing body, it hastened to take remedial action by filing applications for registration both under section 12A and 80G of the Act, which were followed up by another set of applications filed directly with the DIT (Exemptions) on 21.12.2005; these applications were obviously delayed and the condonation application was filed on 14.03.2006 narrating the events that led to the delay. 19. In the above circumstances, it seems to us that the Tribunal has acted judicially, taking note of all the facts and circumstances including probabilities of the case. In Esthuri Aswathiah v. CIT [1967] 66 ITR 478 (SC), the Supreme Court outlined the duties of the Tribunal in the following words: - "The function of the Tribunal in hearing an appeal is purely judicial. It is under a duty to decide all questions of fact and law raised in the appeal before it: for that purpose ....
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....erved as follows: - "The Legislature has conferred the power to condone delay by enacting section 5 of the Limitation Act of 1963 in order to enable the courts to do substantial justice to parties by disposing of matters on the merits". The expression "sufficient cause" employed by the Legislature is adequately elastic to enable the courts to apply the law in a meaningful manner which subserves the ends of justice that being the life-purpose of the existence of the institution of courts. It is common knowledge that this court has been making a justifiably liberal approach in matters instituted in this court. But the message does not appear to have percolated down to all the other courts in the hierarchy." 22. The following general principles were laid down and it is these principles which guide the Court in approaching the question of condonation of delay: - "And such a liberal approach is adopted on principle as it is realized that: 1. Ordinarily, a litigant does not stand to benefit by lodging an appeal late. 2. Refusing to condone delay can result in a meritorious matter being thrown out at the very threshold and cause of justice being defeated. As against this, when d....
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....Tribunal on a question of fact can be challenged only if it is not supported by any evidence, or is unreasonable or perverse. The following pithy observations of T.L. Venkatarama Aiyar, J. speaking for the Court are relevant: - " ....................... The point for decision is whether there arises out of the order of the Tribunal any question which can be the subject of reference under section 66 (1) of the Act Under that section, it is only a question of law that can be referred for decision of the Court, and it is impossible to argue that the conclusion of the Tribunal is anything but one of fact. It has been held on the corresponding provisions in the English Income-tax statutes that a finding on a question of fact is open to attack as erroneous in law only if it is not supported by any evidence, or if it is unreasonable and perverse, but that where there is evidence to consider, the decision of the Tribunal is final even though the Court might not, on the materials, have come to the same conclusion if it had the power to substitute its own judgment. In Great Western Railway Co. v. Bater (1), Lord Atkinson observed: "Their (Commissioners') determinations of questions o....