Assessee allowed to approach CBDT for condonation of delay in filing Form 10AB for 80G registration

Issue

Whether the rejection of an application for regular registration under Section 80G (Form 10AB) solely on the ground of delay is sustainable given the lack of specific condonation provisions in the section, and whether the assessee can seek relief under Section 119(2)(b).

Facts

Registration Status: The assessee-trust held a provisional registration under Section 80G.
Application: The trust filed an application in Form 10AB seeking conversion to regular registration.
Rejection: The Commissioner (Exemption) rejected the application, noting that it was filed beyond the statutory time limit prescribed for Form 10AB.

Decision

Legislative Gap: The authority noted that unlike Section 12A, the Income-tax Act does not contain an explicit provision empowering the Commissioner to condone delays for Section 80G applications.
Remedy via CBDT: However, the assessee is not without remedy. It was held that the assessee-trust is at liberty to approach the Central Board of Direct Taxes (CBDT) to seek condonation of delay under the general powers of Section 119(2)(b).
Direction: The Commissioner (Exemption) was directed to take up the application and dispose of it on merits (i.e., verify the genuineness of activities), subject to the condonation, rather than rejecting it on technical grounds.
Ruling: The order was partly in favour of the assessee.

Key Takeaways

CBDT’s Power u/s 119(2)(b): For procedural delays in Section 80G approvals where the CIT(E) has no power to condone, the CBDT is the competent authority to grant relief to avoid genuine hardship.

Merits over Technicality: The ultimate goal of the registration process is to verify the charitable nature of the trust. Courts/Tribunals generally mandate that if the delay is condonable/technical, the application must be judged on its substance.

IN THE ITAT VISAKHAPATNAM BENCH

C P Reddy Charitable Trust

Commissioner of Income-tax (Exemption)

Ravish Sood, Judicial Member
and BALAKRISHNAN S., Accountant Member

IT Appeal No. 470 (Viz) of 2025

OCTOBER 29, 2025

Smt. V. Krishna Kumari, Adv. for the Appellant. Badicala Yadagiri, CIT-DR for the Respondent.

ORDER

Ravish Sood, Judicial Member.- The present appeal filed by the assessee trust is directed against the order passed by the Commissioner of Income Tax (Exemptions) [hereinafter referred to as “CIT (Exemptions)”], Hyderabad, dated 17.06.2025 rejecting its application filed in “Form No. 10AB” for regular registration under Section 80G(5) of the Income-tax Act, 1961 (for short, “the Act”). The assessee trust has assailed the impugned order on the following grounds of appeal before us:

1. (a) The Learned Commissioner (Exemption) has erred in rejecting the appellant’s application for renewal under section 80G for the reason that the same is filed beyond the time limit prescribed for filing the Form 10AB.

(b) The Learned Commissioner failed to consider the application submitted for condonation of delay in filing Form 10AB explaining that the Managing Trustee’s son died in a road accident and the Author of the Trust, who is mother of all other Trustees passed away during the relevant period and that the delay occurred due to these genuine reasons.

(c) The Learned Commissioner having asked the appellant to produce detailed reply to various specific information relating to the Trust, failed to consider the said information and rejected the application straight away without considering the merits of the case. The Learned Commissioner failed to appreciate that the assessee Trust is genuinely carrying out charitable activities ever since it is established and is eligible for continuation of approval under section 80G.

2. Any other ground that may be urged at the time of the hearing of appeal.”

2. Succinctly stated, the assessee trust was granted provisional registration under Section 80G of the Act by the Central Processing Centre (CPC) in “Form No. 10AC” dated 24.09.2021, valid for the period from AY 2022-23 to AY 2024-25.

3. The assessee trust, had thereafter filed an application for regular registration under Section 80G of the Act in “Form No. 10AB” on 31.12.2024. During the course of the proceedings, the assessee trust had in response to notices issued by the CIT(Exemptions), dated 29.03.2025 and 19.05.2025, vide its replies submitted the requisite details/information in response to the queries that were raised by him.

4. However, the CIT(Exemptions) rejected the aforesaid application vide his order dated 17.06.2025, on the ground that the assessee trust had failed to apply for regular registration within the prescribed time limit. It was observed by him that as per the amended provisions introduced by the Finance Act, 2020, an application in “Form No. 10AB” should be filed at least six months prior to the expiry of the provisional registration or within six months from the commencement of its activities, whichever is earlier.

5. The CIT(Exemptions) further observed that the CBDT vide Circular No. 7/2024 dated 25.04.2024 had extended the “due date” for filing Form No. 10A/10AB till 30.06.2024. It was observed by him, that as the assessee trust had filed its application in “Form 10AB” on 31.12.2024, therefore, it was time-barred. Accordingly, the CIT(Exemptions) rejected the application filed by the assessee trust for regular registration under Section 80G of the Act on the ground of the delay involved in filing the same.

6. Aggrieved, the assessee trust has carried the matter in appeal before us.

7. Smt. V. Krishna Kumari, Advocate, Ld. Authorised Representative (for short, “AR”) for the assessee trust at the threshold of hearing, submitted that the assessee trust is carrying on charitable activities, viz. providing food to the poor, educational assistance, medical camps, food and medical assistance to aged people etc. The Ld. AR further took us through the financial statements of the assessee trust for the preceding years. The Ld. AR submitted that the application filed by the assessee trust for regular registration under Section 80G has been rejected by the CIT (Exemption), Hyderabad for the reason that the same was filed beyond the prescribed time period. Elaborating on the reasons leading to the delay in filing the application, the Ld. AR submitted that the same had crept in due to the unfortunate death of the son of the managing trustee in a road accident. The Ld. AR submitted that thereafter the mother of the trustees had expired. The Ld. AR submitted that as the delay in filing the application for regular registration was on account of the aforesaid unfortunate and compelling reasons, therefore, the same in all fairness be condoned and the matter be restored to the file of the CIT(Exemption) for considering the same on merits.

8. Sri Badicala Yadagiri, CIT-DR supported the order of the CIT(Exemptions), and submitted that the time limit for filing an application for registration under section 80G of the Act, as prescribed under the law is mandatory in nature, and the CIT (Exemptions) has no discretion to condone the delay in filing of “Form 10AB”.

9. We have heard the Ld. Authorized Representatives of both parties and perused the material available on record.

10. Admittedly, the assessee trust that was granted provisional registration under Section 80G of the Act, had filed “Form 10AB” for regular registration on 31.12.2024. As observed by us hereinabove, the CBDT, vide Circular No. 7/2024 dated 25.04.2024, had extended the “due date” for filing such application till 30.06.2024, therefore, there can be no denying the fact that the application filed by the assessee trust was beyond the prescribed time limit.

11. Although the delay in filing the application for regular registration under Section 80G in “Form 10AB” is procedural in nature, but we are afraid that the provisions of the Act read along with the CBDT Circular No. 7/2024 (supra) are clear on the prescribed time limit in so far the filing of an application for regular registration in “Form 10AB” under Section 80G of the Act is concerned. However, we are at the same time of a firm conviction that procedural lapses should not be allowed to defeat the substantive rights, particularly in matters of charitable trusts seeking exemptions. Although there is no explicit provision under the Income-tax Act or rules for condonation of the delay in filing of “Form 10AB” for regular registration under Section 80G of the Act, but, the assessee trust remains at liberty to approach the CBDT for condonation under Section 119(2)(b) of the Act. Thereafter, the CIT(Exemptions) is directed to take up and dispose of the application filed by the assessee trust for regular registration under Section 80G of the Act, on merits, in accordance with extant law and after providing due opportunity of being heard to the assessee trust.

12. Resultantly, the appeal of the assessee trust is allowed for statistical purposes in terms of our aforesaid observations.