ITAT Chennai: Belated Form 10AB Filing for Section 80G Approval Saved by Finance Act 2024 Amendment — Hirawat Foundation vs CIT(E)

Background and Overview

The Chennai Bench of the Income Tax Appellate Tribunal recently delivered a significant ruling in the matter of Hirawat Foundation Vs CIT (Exemption), addressing a critical question around the rejection of an application for approval under Section 80G of the Income Tax Act, 1961. The case carries considerable importance for charitable trusts and institutions that missed the extended deadline for filing Form 10AB but can now seek refuge under the amended statutory framework introduced by the Finance Act, 2024.

The Commissioner of Income Tax (Exemptions) had passed an order dated 03.03.2025 rejecting the assessee trust's application on the ground that it was submitted after the prescribed due date. The Tribunal, however, took a holistic view of the amended legal position and directed the authority to reconsider the application under the newly inserted clause (iv)(B) of the first proviso to Section 80G(5).

Condonation of Delay: 160-Day Delay Explained and Condoned

Before proceeding to examine the merits of the appeal, the Tribunal had to address a preliminary issue of delay. The appeal was filed before the Tribunal on 07.11.2025, whereas the time limit for filing under Section 253(3) of the Income Tax Act, 1961 had expired on 31.05.2025 — resulting in a delay of 160 days.

Reasons Submitted by the Assessee Trust

The assessee filed an affidavit of the Managing Trustee along with a formal condonation petition, which set out the following sequence of events:

  • The assessee trust had filed an online application dated 28.09.2024 in Form 10AB under Rule 11AA of the Income Tax Rules, 1962, under clause (iii) of the first proviso to sub-section (5) of Section 80G.
  • The application was rejected by the Commissioner of Income Tax (Exemptions), Chennai, vide order dated 03.03.2025.
  • On receipt of an SMS alert on the trust's registered mobile number, Shri Rajendra Kumar Hirawat — a trustee and also a Director in M/s. Polypipes — instructed an employee named Shri Karthikeyan to check the income tax portal and furnish a report on any developments.
  • Unfortunately, Shri Rajendra Kumar Hirawat inadvertently neglected to follow up on the matter. Simultaneously, Shri Karthikeyan also failed to report back to the trustee.
  • The matter came to light only during the last week of October 2025, when the trust's auditor visited the office of the Commissioner of Income Tax (Exemptions) to inquire about the application status. The office confirmed that the application had been rejected on 03.03.2025.
  • The Chartered Accountant immediately brought this to the attention of Shri Rajendra Kumar Hirawat, who verified the same on the income tax portal.
  • Shri Karthikeyan was subsequently terminated from employment, as his failure to report the rejection order despite specific instructions was treated as a serious dereliction of duty.
  • Upon receiving guidance from Shri T. Banusekar, Advocate, the appeal was drafted and filed on 07.11.2025, accompanied by the present condonation petition.

Tribunal's Ruling on Delay

After carefully examining the affidavit and the stated reasons, the Tribunal held that no negligence could be attributed to the assessee. The circumstances demonstrated sufficient cause for the belated filing, and accordingly, the delay of 160 days was condoned. The Tribunal then proceeded to adjudicate the appeal on its merits.

Core Issue: Rejection of Form 10AB for Section 80G Approval

Factual Timeline of the Application

The facts leading to the rejection of the application are as follows: