TaxTMI 
TaxTMI 
2026 (6) TMI 1172
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....CIT(E)]. 2. We have heard both the parties and perused the records. In this case, assessee had filed an applicable for registration u/s. 80G(5) of the Act on 25-09-2024. Ld.CIT(E) issued notice and the assessee filed reply along with the documents asked by the Ld.CIT(E). In this case, it is an admitted fact that the assessee was granted provisional approval u/s. 80G(5) of the Act on 21-10-2021. It is also noted that assessee has a registration u/s. 12AB of the Act, dt. 30-12-2025. In this case, assessee vide letter dt. 20-01-2025 uploaded copy of financial statement for the last three years, Memorandum of Association, audit report for the last three years, copy of income tax returns, copy of certificate of incorporation, copy of cash boo....
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....evious year relevant to the assessment year from which the said approval is sought; (B) commenced ^9[***]at any time after the commencement of such activities:] Thus, after the amendment introduced by the Finance Act, 2024, the trust who have commenced activity can file application for approval at any time after the commencement of the activities. The said amendment was applicable in the case of the assessee. Therefore, Ld.CIT(E)'s order rejecting 80G(5) application, treating it as time barred, is bad in law. 5. Thus, in this case assessee have provisional approval u/s80G(5) of the Act upto AY 2024-2025. The relevant part of Section 80G(5) is reproduced here as under : 80G. (1) In computing the total income of an ass....
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.... 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 respect of such business and that the donations received by it will not be used, directly or indirectly, for the purposes of such business; (ii) the instrument under which the institution or fund is constituted does not, or the rules governing the institution or fund do not, contain any provision for the transfer o....
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....[as it stood immediately before its amendment by the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020], within three months from the 1st day of April, 2021; (ii) where the institution or fund is approved and the period of such approval is due to expire, at least six months prior to expiry of the said period; (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; (emphasis supplied) ^72[(iv) in any other case, where activities of the institution or fund have-- (A) not commenced, at least one month prior to....
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....od of five years; or [(B) if he is not so satisfied, pass an order in writing,-- (I) in a case referred to in clause (ii) or clause (iii) of the first proviso, rejecting such application and cancelling its approval; or (II) in a case referred to in sub-clause (B) of clause (iv) of the first proviso, rejecting such application, after affording it a reasonable opportunity of being heard;] [(iii) where the application is made under sub-clause (A) of clause (iv) of the said proviso or the application is made under clause (iv) of the said proviso as it stood immediately before its amendment vide the Finance Act, 2023, pass an order in writing granting it approval provisionally for a period of three ye....
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....g charity institutions. Further, to facilitate the registration of the new charity institution which is yet to start their charitable activities, I propose to allow them provisional registration for three years. " Unquote. Finance Bill 2020 Quote "(vi) an entity making fresh application for approval under clause (23C) of section 10, for registration under section 12AA, for approval under section 80G shall be provisionally approved or registered for three years on the basis of application without detailed enquiry even in the cases where activities of the entity are yet to begin and then it has to apply again for approval or registration which, if granted, shall be valid from the date of such provisional registration. The applicat....