Navjyoti Education Society’s 80G Approval Dispute Remanded by ITAT for Reconsideration [Read Order]

The bench of the Income Tax Appellate Tribunal, Kolkata, directed the Commissioner of Income Tax (Exemptions) [CIT (Exemptions)], to re-examine the issue concerning a delayed application for approval under Section 80G(5)(iii) of the Income Tax Act, 1961 for fresh adjudication.

The assessee Navjyoti Education Society, based in Jhargram, West Bengal, was granted provisional approval under Section 80G(5)(iv) of the Income Tax Act, 1961, through Form No. 10AC by an order dated December 31, 2021, which remained valid up to the Assessment Year 2024-25.

Subsequently, the Society filed an application for renewal of approval under Section 80G(5)(iii) in Form 10AB on January 16, 2023, under Rule 17A of the Income Tax Rules, 1962. Upon receiving a notice seeking supporting details of its activities, the Society furnished the necessary documents, and it was noted that the organization had been operational since April 6, 2000.

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However, referring to CBDT Circular No. 8/2022 dated March 31, 2022, the CIT (Exemptions) observed that the extended deadline for filing Form 10AB was September 30, 2022. The Society argued that CBDT Circular No. 6/2023 dated May 24, 2023, extended the deadline to September 30, 2023, but the CIT (Exemptions) concluded that this relaxation did not apply to applications under Section 80G(5)(iii). Consequently, Form 10AB was rejected.

The appellant through P. K. Ray, contended before the Tribunal that CBDT Circular No. 7/2024 dated April 25, 2024, further extended the deadline for submission of Form 10AB under Section 80G(5)(iii) until June 30, 2024. It was argued that it had already submitted the Form 10AB application prior to the issuance of this circular, and the online system did not permit filing another application.

Therefore, it prayed that the existing Form 10AB submission be treated as a valid application under Section 80G(5)(iii), and the matter be remanded to the CIT (Exemptions) for fresh consideration in light of the extended timelines and procedural hardships.

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The Bench comprising Rajesh Kumar, Accountant Member and Sonjoy Sarma, Judicial Member observed that the appellant had filed its Form 10AB application prior to the issuance of CBDT Circular No. 7/2024, which extended the due date for such applications to June 30, 2024. Given that the system restrictions prevented the filing of a fresh application, and considering the principle of natural justice, the Tribunal held that the issue warranted fresh examination.

Accordingly, the Tribunal remanded the matter to the file of the CIT (Exemptions), directing it to reconsider the application afresh after granting reasonable opportunity to the assessee.

Thus, the appeal was allowed for statistical purposes.

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