Grant U/s 80G Can't Be Rejected Merely On Procedural Lapse By Making Application U/s 80G(5)(Ii) Inadvertently Instead Of U/s 80G(5)(Iii): Ahmedabad ITAT
Referring to the decision of the Calcutta Bench in ITA No. 994/Kol/2023, the Ahmedabad ITAT reiterated that the assessee, who has been granted provisional registration, is eligible to apply for final registration irrespective of the fact that the assessee had already commenced its activity even prior to the date of grant of provisional approval. The ITAT explained that Section 80G of...
Referring to the decision of the Calcutta Bench in ITA No. 994/Kol/2023, the Ahmedabad ITAT reiterated that the assessee, who has been granted provisional registration, is eligible to apply for final registration irrespective of the fact that the assessee had already commenced its activity even prior to the date of grant of provisional approval.
The ITAT explained that Section 80G of the Income Tax Act provides tax exemptions for donations made to specified charitable institutions and funds. The tax exemption under Section 80G is intended to encourage philanthropy by allowing individuals and entities to deduct the amount of donations made from their taxable income.
The Bench of Waseem Ahmed (Accountant Member) and Madhumita Roy (Judicial Member) observed that “rejection of grant under Section 80G merely on procedural lapse by making application under Section 80G(5)(ii) inadvertently instead of under Section 80G(5)(iii) on the part of the assessee is not acceptable”. (Para 7)
As per the brief facts of the case, the assessee has challenged the order passed by the CIT(Exemption) whereby and whereunder the application for grant of approval under sub-Section (5) of Section 80G of the Act was rejected only on the plea that such application for the year under consideration was though required to be filed under Section 80G(5)(iii) the same was filed under Section 80G(5)(ii) of the Act.
The Bench found that the appellant has been granted provisional approval under Clause (iv) of First Proviso to sub-Section (5) of Section 80G of the Act for the period from A.Y. 2021-22 to A.Y. 2024-25.
The Bench observed that merely because of the application being made under a different Clause (ii) of First Proviso of Section 80G(5) by mistake the same could have been treated by the CIT(E) under Clause (iii) of First Proviso of Section 80G(5).
This procedural mistake could have been condoned ignored by the CIT(E) having regard to the eligibility of the assessee for such grant, added the Bench.
Hence, the ITAT remitted the issue to the file of the CIT(E) with a direction upon him to treat the said application under Section 80G(5)(iii) of the Act and to pass orders strictly in accordance with law.
Counsel for Appellant/ Assessee: Parin Shah
Counsel for Respondent/ Revenue: Dr. Darsi Suman Ratnam
Case Title: Shree Bipin Biharidas Charitable Foundation verses CIT (Exemption)
Case Number: I.T.A. No. 1091/Ahd/2023