TaxTMI 
TaxTMI 
2026 (6) TMI 226
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....reciating that the appellant is engaged in genuine charitable activities. 3. That the Ld. CIT (Exemption) failed to appreciate that the delay in filing the application was neither intentional nor deliberate, but due to bona fide reasons, and therefore deserved to be condoned in the interest of justice. 4. That the Ld. CIT (Exemption) erred in law in holding that he has no power to condone the delay, without considering that procedural provisions should be interpreted liberally in the case of charitable institutions to advance the cause of justice. 5. That the rejection of the application on technical grounds defeats the very purpose of granting exemption to charitable institutions and is against the spirit of the Income Tax Act. 6. That the Ld. CIT(Exemption) failed to consider the objects, activities and genuineness of the appellant trust/society before rejecting the application. 7. That the appellant craves leave to add, alter, amend or withdraw any of the above grounds of appeal at the time of hearing." 2. The only issue contested by the assessee through its grounds of appeal is rejection of its application for granting exemption u....
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....he provisions of this section,- xxx xxx xxx xxx (5) This section applies to donations to any institution or fund referred to in sub-clause (iv) of clause (a) of sub-section (2), only if it is established in India for a charitable purpose and if it fulfils the following conditions, namely :- (i) where the institution or fund derives any income, such income would not be liable to inclusion in its total income under the provisions of sections 11 and 12 or clause (23AA) or clause (23C) of section 10 : Provided that where an institution or fund derives any income, being profits and gains of business, the condition that such income would not be liable to inclusion in its total income under the provisions of section 11 shall not apply in relation to such income, if- (a) the institution or fund maintains separate books of account in respect of such business; (b) the donations made to the institution or fund are not used by it, directly or indirectly, for the purposes of such business; and (c) the institution or fund issues to a person making the donation a certificate to the effect that it maintains separate books of account in....
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.... in such manner and setting forth such particulars and within such time as may be prescribed: Provided that the institution or fund may also deliver to the said prescribed authority a correction statement for rectification of any mistake or to add, delete or update the information furnished in the statement delivered under this sub-section in such form and verified in such manner as may be prescribed; and (ix) the institution or fund furnishes to the donor, a certificate specifying the amount of donation in such manner, containing such particulars and within such time from the date of receipt of donation, as may be prescribed: 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) where the institution or fund is approved under clause (vi) [as it stood immediately before its amendment by the Finance Act, 2020], within three months from the date on which this proviso has come into force; (ii) where the institution or fund is approved and the period of such approval is due to expire, at least six months pr....
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....use (i) of the first proviso, from the assessment year from which approval was earlier granted to such institution or fund; (b) clause (iii) of the first proviso, from the first of the assessment years for which such institution or fund was provisionally approved; (c) in any other case, from the assessment year immediately following the financial year in which such application is made.]" 5. The Ld. CIT(Exemption) is required to look into the aforesaid conditions as enumerated in the relevant provisions before granting of exemption u/s. 80G(5) of the Act specifically sub-clause (iii) "the institution or fund is not expressed to be for the benefit of any particular religious community or caste...". The Ld. CIT(Exemption) before accepting or rejecting the application has to look into all these conditions and deal each of them vis-à-vis facts of the assessee's case so to provide specific reasoning regarding his final decision. The purpose of exemption provisions arises once such trust or society obtains registration u/s. 12A of the Act from the Department which itself establishes that such trust or society is registered as charitable institution in terms wit....