TaxTMI 
TaxTMI 
2024 (3) TMI 614
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....g application for registration u/s. 80G(5) without considering 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 ....
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....ication, at any time after the commencement of such activities,]. **The said clause (iv) of first proviso to sub-section (5) of section 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 ....
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....at "Form No. 10AB, in case of an application under clause (iii) of the first proviso to clause (23C) of section 10 or under sub-clause (iii) of clause (ac) of sub-section (1) of section 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 sec....
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....filed present application in Form 10AB as per the Clause (iii) of First Proviso to sub-section 5 of Section 80G. Clause (iii) of First Proviso to Section 80G(5) reads as under: "Provided that the institution 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 f....
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....e is in appeal before us. 10. Learned Counsel for the assessee, argued that provisions of Section 80G(5)(iii) have not defined the meaning of Commencement of activities. The assessee-trust has actually taken steps for pursuing the objectives on 07/11/2022, which should be treated as the date 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 doc....
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....in exercise of its powers under Section 119(1) of the Act, extends the due date for electronic filing of such Form as under: (i) The application for registration or approval under Section 10(23C), 12A or 80G of the Act in form No.10AB, for which the last date for filing falls on or before 29th September, 2022, may be filed on or before 30th 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 a....
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....ional registration or within Six months of commencement of activities, whichever is earlier. 10.3 In continuation of this when we read the 'sub clause iii of Proviso' of section 80G(5), which we have already reproduced above, it is clear that the intention of parliament in putting the word "or within six months of commencement of its activities, whichever is earlier" is in the context of the newly 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 i....
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.... sells his property to B with a stipulation that after sometime, which may be a couple of years or more, he shall resell the property to A for the same price. Could it be contended in such a case that when B transfers the property to A for the same price at which he originally purchased it, he should be liable to pay tax on the basis as if he has received the market value of the property as on the date of resale, if, in the mean-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 inten....
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....rlal Daga Charitable Trust (supra) dealt with only the issue/terminology of "whichever is earlier" which is applicable to new trust which have created recently, and it does not deal with condonation of delay in case of old trust who made the application before ld CIT(E ) very late, that is, the issue mention in clause (iii) of 3rd proviso of section 80(5), "where the institution or fund has been provisionally approved, at least six months prior to expiry of the period 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 ....
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....ce complaint, remanded Sikri to custody and also referred to the fact that in the bail application, Sikri had again owned up responsibility for the fake certificates of registration. Taking an overall view of the facts and going by the preponderance of probabilities, the Tribunal came to hold the view that it was because of the irregularities, illegalities and misrepresentations of Sikri that the assessee-society was led to believe that appropriate applications under the Act were already 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 d....
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....as to whether in condoning the delay the Tribunal committed any error of law or illegality. There is a wealth of judicial literature on the subject of condonation of delay and most of the cases have arisen under section 5 of the Limitation Act, 1963. The principles that are to be applied are, however, no different whenever the question of condonation of delay comes up for consideration under other statutes. In the oft quoted judgment of the Supreme Court in Collector, Land Acquisition v. MST. Katiji [1987] 167 ITR 471 it was observed 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 p....
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....has been no want of bona fides on the part of the assessee, nor did it fail to take immediate action once it was apprised of the irregularities in its affairs by M. P. Mansinghka Trust of Mumbai. In these circumstances, we are unable to say that the Tribunal committed an error in condoning the delay. 24. On the question of perversity of the decision of the Tribunal we may also refer to the judgment of the Supreme Court in Sree Meenakshi Mills Ltd. v. CIT [1957] 31 ITR 28. In that judgment, it was noted that only a question of law can be referred for decision of the Court and the decision of the 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 ....
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....'s view. Obviously the argument cannot be upheld, having regard to the above judgments. 27. For the above reasons we answer the substantial questions of law framed in ITA Nos.754, 773 and 775 of 2010 in the negative, against the Revenue and in favour of the assessee. Consequently the sole substantial question of law framed by us in ITA Nos.1092, 1101, 1103, 1104, 1112 and 1124 of 2010 is answered in the affirmative, against the Revenue and in favour of the assessee. The C.M. Application is disposed of. The appeals of the Revenue are accordingly dismissed with no order as to costs." 20. Respectfully following the judgement of the Hon'ble Delhi High Court in the case of Vishwa Jagriti Mission (supra), wherein the delay in filing application for registration u/s. 12A, was allowable / condoned, hence, we condone the delay in filing Form10AB, u/s. 80G(5), and remit the matter back to the file of Ld.CIT(E) with the direction to decide the application of assessee, in accordance with law. The assessee is also directed to file details and documents, before ld CIT(E), as and when, required by ld CIT(E). For statistical purposes, the appeal of the assessee is treated to ....