The Ahmedabad Bench of Income Tax Appellate Tribunal ( ITAT ) restored the application for approval under Section 80G(5) of Income Tax Act,1961 for reconsideration following the issuance of a new circular by the Central Board of Direct Taxes ( CBDT ).
Prayas Charitable Trust,the appellant-assessee,filed an appeal against the order from the Commissioner of Income Tax (Exemption)[CIT(E)], dated 13.03.2024. The assessee challenged the rejection of its application for approval under Section 80G(5) of the Act. The primary contention was that the CIT(E) wrongly dismissed the application due to the failure to submit Form 10AB within the prescribed time frame.
The assessee argued that the CIT(E)’s decision to declare the application non-maintainable was both incorrect and unlawful, asserting that they were entitled to approval under Section 80G(5) based on the merits of their application. Additionally, they claimed that the delay in filing the application was due to bona fide reasons beyond their control and requested the condonation of this delay. They urged the authorities to consider the merits of the case rather than focusing solely on the timing of the submission.
Step by Step Guidance for Tax Audit & E-filing, Click Here
During the hearing, there was no appearance on behalf of the assessee. The records indicated that while the assessee had received provisional approval under Section 80G(5)(iii), it had failed to file Form 10AB by the deadline of 20.11.2022, resulting in the CIT(E) dismissing the application.
However, the situation shifted with the issuance of Circular No. 7/2024 by CBDT on 25.04.2024, which allowed for the submission of fresh applications for Form 10AB. This development prompted the tribunal to restore the case to the CIT (E) for reconsideration.
The two member bench comprising Siddhartha Nautiyal(Judicial Member) and Dr.BRR Kumar(Accountant Member) directed the CIT(E) to provide the assessee with a fair opportunity to present its case and to ensure that the application would not be rejected solely based on the reasons cited in the earlier order. In conclusion,the assessee’s appeal was allowed for statistical purposes.
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
