Supreme Court Upholds Condonation of 687‑Day Delay in Trust’s Audit Filing u/s 12A, With Costs Imposed [Read Judgement]

In a recent ruling, the Supreme Court of India dismissed the tax department’s challenge against a Bombay High Court order that excused a 687‑day delay in filing the audit report of a charitable trust under Section 12A of the Income Tax Act, 1961.

The petitioner, Manav Vikas Bahuuddeshiya Gramin Seva Sanstha, had filed its audit report for the financial year 2016‑17 nearly two years late, citing that its accountant was unaware of the newly introduced online filing system. The Commissioner of Income Tax (Exemptions), Pune, refused to condone the delay, calling the explanation insufficient under Section 119(2)(b) of the Act.

When the matter reached the Bombay High Court (Nagpur Bench), Justices Avinash G. Gharote and Abhay J. Mantri observed that the trust had already submitted its audit report and provided an honest reason for the delay. The bench noted that denying condonation would unfairly deprive the trust engaged in providing medical aid to the underprivileged—of its lawful exemption.

Referring to the precedent in Al Jamia Mohammediyah Education Society v. CIT (Exemptions), the Court quashed the Commissioner’s order and allowed the delay, subject to a ₹10,000 cost per petition, payable to the Raman Science Centre, Nagpur.

After the submission, the Supreme Court, in its order dated 10 April 2026, condoned the delay in filing the appeal but declined to interfere with the High Court’s judgment.

The bench comprising Justice Pankaj Mithal and Justice S. V. N. Bhatti held that no error warranted intervention under Article 136 of the Constitution, thereby affirming the High Court’s decision.

The apex court observed that “ In the facts and circumstances of the case, we are not inclined to interfere with the judgment and order impugned passed by the High Court in exercise of our discretionary jurisdiction under Article 136 of the Constitution of India.”

Accordingly, the petition was disposed of.

Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates