The Delhi bench of the Income Tax Appellate Tribunal (ITAT) restored the trust’s 80G(5) Registration Application back to the Commissioner of Income Tax (Exemption) (CIT (E)) despite a 6-year delay.
The facts, in brief, are that the assessee, a trust, filed an application seeking registration under Section 80G(5) of the Income Tax Act, 1961. The said application was rejected by the CIT(E) on the ground that it was not filed within the prescribed time.
Mr. Ved Jain, representing the assessee, submitted that the intent of the legislature has to be construed in the context it was brought into the statute book. If the provision is read as construed by the learned CIT (E), then the assessee trust, which had commenced activities but was not registered prior to the amendment in the law, would never be able to apply for registration under Section 80G.
Mr. T. James Singson, representing the revenue, opposed the submissions and submitted that there is no ambiguity under the provisions of the law. The assessee trust was required to file the application within six months from the date of grant of provisional registration or commencement of the activity, whichever is earlier. In the present case, the assessee trust had commenced its activities way back in 2017; therefore, the application filed by the assessee on 15.03.2023 was barred by time.
The bench held that the Assessee had made the application in form 10AB within the prescribed time limit and hence it is a valid application. Therefore, ITAT directed the CIT(E) to treat the application as filed within the statutory time and verify the assessee’s eligibility as per the Act. The CIT (E) shall grant an opportunity to the assessee. The assessee shall be at liberty to file all the necessary documents before the CIT (E).
The two-member bench of the tribunal comprising Pradip Kumar Kediya (Accountant member) and Kul Bharat (Judicial member) set aside the order and restored the application before CIT(E) for decision afresh in accordance with the law. Accordingly, the assessee’s appeal stands allowed for statistical purposes.
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