80G(5)(iii) application remitted to CIT(E) for fresh consideration of approval, considering CBDT circulars and providing hearing opportunity.

Headnote:

Sankalp Foundation, Kota, challenged the rejection of its application for approval under Section 80G(5)(iii) of the Income Tax Act by the CIT(E), Jaipur. The CIT(E) had dismissed the application on grounds of expiry of provisional registration and non-commencement of activities. The ITAT held that the CIT(E) had not considered relevant CBDT circulars clarifying that provisional approvals issued due to technical glitches are to be treated as valid approvals and that trusts registered under Section 12A are entitled to 5-year validity. The matter was remitted to the CIT(E) to decide the application afresh, considering the circulars and after providing the applicant an opportunity of being heard.

Background:

The appellant, Sankalp Foundation, applied on 23.11.2024 for approval under Section 80G(5)(iii). The CIT(E) rejected it, noting the earlier provisional registration under Section 80G(5)(iv) expired in March 2024 and the foundation had not commenced activities. The appellant argued that it was registered under Section 12A(1)(ac)(i) for 5 years and cited CBDT Circulars No. 11/2022 and 06/2023, which clarify that provisional approvals issued due to technical issues should be treated as valid approvals for 5 years. CIT(E) failed to consider these submissions, prompting the appeal.

Conclusion:

The ITAT remitted the matter to CIT(E) for fresh consideration of the 80G(5)(iii) application in accordance with CBDT circulars. CIT(E) must provide the foundation an opportunity of being heard and decide the matter afresh, addressing both expiry of provisional registration and commencement of activities. Appeal disposed for statistical purposes with direction for compliance.

Case Details:

Case No.: ITA No. 1006/JPR/2025

Bench: Jaipur B-Bench, AM: Rathod Kamlesh Jayantbhai, JM: Narinder Kumar

Appellant: Sankalp Foundation, Kota

Respondent: CIT(E), Jaipur

Date of Hearing: 06/10/2025

Date of Pronouncement: 07/10/2025