TaxTMI 
TaxTMI 
TaxTMI 
2024 (6) TMI 924
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....ng and mis-reading the provisions of Section 80G. 4. The Learned Commissioner of Income Tax erred in ignoring the fact that the appellant had been granted a provisional registration by the Commissioner of Income Tax's predecessor. 5. Having regard to the facts and circumstances of the case and the provisions of law, the appellant submits the Commissioner of Income Tax be directed to grant the Certificate u/s 80G to the Appellant." 2. Brief facts of the case are that the assessee is a Trust set up in the year 1953 and obtained registration under Section 12A in the year 1977. After insertion of new provisions for registration of Trust under Section 12AB and approval under Section 80G(5) of the Act, vide Finance Act, the assessee availed fresh registration under section 12AB and also applied for provisional approval under Section 80G(5) of the Act. The provisional approval under section 80G(5) was granted to assessee on 16/12/2022. Accordingly, the assessee applied for final/regular approval under Section 80G of the Act on 02/02/2023 in Form-10AB. Alongwith application, the assessee filed certain details as per requirement of Form-10AB. The ld. CIT(E) on going through such det....
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....was also cancelled. Further aggrieved, the assessee has filed present appeal before this Tribunal. 4. We have heard the submissions of the learned Authorised Representative (ld. AR) of the assessee and the learned Commissioner of Income Tax-Departmental Representative (ld. CIT-DR) for the revenue. We have also deliberated on the various evidences filed in the form of paper book. The ld. AR of the assessee reiterated his submission as per the submission filed by assessee before the ld. CIT(E). The ld. AR of the assessee submits that the assesse trust is in existing since 1953 and allowed registration under Section 12A in the year 1977. Their object and activities was never doubted. After amendment in registration process in 2021, the assessee obtained provisional certificate under Section 80G(5) of the Act for the first time which was allowed. The assessee immediately applied for final approval on 02/02/2023, however, the same was rejected by taking a view that the application is not filed within the time limit and the extended period as per CBDT Circular No. 6/23 dated 24/05/2023. The ld. AR of the assessee submits that on similar issue, Jodhpur Bench of Tribunal in Bhamashah Sund....
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....e amendment, all the existing Trust/Institutions which were already having registration u/s12AA or 80G(5) were asked to re-apply for registration as per the amendment brought in 2020 and a date was specified before which all those Trust/Institutions already having Registration was required to make a fresh application as per the amendment procedure. 7. In this background we have to interpret the relevant provisions. To interpret the provisions, we shall refer to the Budget Speech of the Hon'ble Finance Minister. 7.1 The Hon'ble Supreme Court in the case of K P Varghese Vs. ITO [1981] 131 ITR 597 (SC) has observed as under regarding use of Speech of a Minister as a tool in interpretation: Quote , " Now it is true that the speeches made by the Members of the Legislature on the floor of the House when a Bill for enacting a statutory provision is being debated are inadmissible for the purpose of interpreting the statutory provision but the speech made by the mover of the Bill explaining the reason for the introduction of the Bill can certainly be referred to for the purpose of ascertaining the mischief sought to be remedied by the legislation and the object and purpose for whic....
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....s. The amendment made to simplify a procedure cannot be interpreted in a way that it causes prejudice to the Trust/institutions. 10. Thus, when we read the Budget Speech of the Hon'ble Finance Minister 2020 and the Memorandum of Finance Bill, 2020 together, it becomes clear that the concept of Provisional registration was mainly to facilitate the registration of newly formed Trust/Institutions which have not yet begun the activities. The parliament in its wisdom has decided to differentiate between the Trust which were newly formed and the trust which were already doing charitable activities. In the second category of cases, there are again two possibilities, one trust was already doing charitable activities and was already having Registration u/s 12AA or 80G(5) of the Act, such trust were directed to re-apply for registration under new procedure on or before 30th August, 2020 but due to Covid- 19 this date was subsequently extended. There is Second category of trust/institutions which were already doing Charitable Activities but had never applied for registration u/s.80G(5) of the Act. It is not mandatory that every charitable trust/institution has to apply for registration u/s....
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....tion 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. Take, for example, a case where A agrees to sell his property to B for a certain price and before the sale is completed pursuant to the agreement and it is quite well known that sometimes the completion of the sale may take place even a couple of years after the date of the agreement - the market price shoots up with the result that the market price prevailing on the date of the sale exceeds the agreed price at which the property is sold by more than 15 per cent of such agreed price. This is not at all an uncommon case in an economy of rising prices and in fact we would find in a large number of cases where the sale is completed more than a year or two after the date of the agreement that the market price prevailing on the date of the sale is very much more than the price at which the property is sold under the agreement. Can it be contended with any degree of fairness and justice that in suc....
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....ieve the obvious intention of the Legislature and produce a rational construction". 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 paragraph, we are of the opinion that the words, "within six months of commencement of its activities" has to be interpreted that it applies for those trusts/institutions which have not started charitable activities at the time of obtaining Provisional registration, and not for those trust/institutions which have already started charitable activities before obtaining Provisional Registration. We derive the strength from the Speech of Hon'ble Finance Minister and the Memorandum of Finance Bill 2020. 11.3 Therefore, in these facts and circumstances of the case, we hold that the Assessee Trust had applied for registration within the time allowed under the Act. Hence, the application of the assessee is valid and maintainable. 12. Even otherwise, the Provisional Approval is uptoA.Y.2025-26, and it can be cancelled by the ld.CIT(E) only on the specific violations by the assessee. However, in this case....