ITAT Pune on Condonation of Delay in Form 10AB for Section 12AB Registration

Why even a 7 Day Delay in Form 10AB Now Matters So Much

The world of charitable trust registration under Indian tax law has never been more complex—or unforgiving. Since the overhaul of Section 12AB in 2021, trusts and NGOs face a maze of new forms, shifting deadlines, and a bewildering array of registration clauses. A single misstep—be it a minor delay in filing Form 10AB or a simple error in selecting the right clause—can now result in the denial of crucial tax exemptions under Sections 11 and 12. For many genuine organisations, this means the difference between survival and shutdown.

The Compliance Puzzle Under Section 12AB

The new regime demands that every trust or institution seeking exemption must navigate between provisional and regular registration, each with its own timelines and technical requirements. The introduction of multiple sub-clauses under Section 12A(1)(ac) has made the process even more intricate. Even a small error—like misunderstanding when “activities” are deemed to have commenced, or picking the wrong item (A or B) in Form 10AB—can trigger a rejection. Worse, the system has little patience for procedural lapses, often treating them as fatal rather than curable. For assistance, trusts in Chandigarh can consult expert professionals familiar with this landscape.

Ramtirth Godavari Seva Samiti: A Turning Point

This is where the recent decision of the ITAT Pune in Ramtirth Godavari Seva Samiti vs CIT becomes a watershed moment. The facts were simple but telling: the trust began its activities in July 2023, obtained provisional registration in July 2024, and then filed Form 10AB just 7 days after the extended deadline. The application was also made under the “wrong” clause, according to the Commissioner. The result? Outright rejection—until the ITAT stepped in.

The Tribunal’s order did more than just offer relief to one trust. It recognised the reality of widespread confusion, especially in light of the CBDT’s own Circular No. 7/2024, which admitted that many applicants were tripping up on technicalities. Most importantly, the ITAT pointed to the new proviso to Section 12A(1)(ac) (effective 01.10.2024), which gives the Commissioner explicit power to condone minor, bona fide delays. The message was clear: the law is moving towards a more humane, discretion-based approach, and authorities must not reject applications mechanically.

What This Article Will Answer

This article unpacks the Ramtirth Godavari Seva Samiti decision, the CBDT’s clarificatory circular, and the new legal framework. It answers the practical questions that matter most to trusts, NGOs, and their advisors:

• What counts as a “reasonable cause” for delay, and what evidence is needed?
• How do you distinguish between a curable, minor lapse and a more serious compliance failure?
• What are the most common errors in clause selection, and how can they be fixed—even after the fact?
• How can you use the ITAT Pune order and the new proviso to defend or revive a delayed or technically defective application?
• What protocols and checklists can help you avoid these pitfalls in the first place?

By connecting the dots between the law, the latest circular, and real-world practice, this series aims to turn procedural landmines into manageable risks—and help genuine charitable organisations secure the tax benefits they deserve. For trusts located near Delhi, expert guidance in this area is readily available.

The Legal Framework in Motion: Section 12A(1)(ac), Form 10AB, Circular 7/2024, and the New Proviso

The landscape of trust registration under Section 12AB is a moving target, shaped by evolving statutes, procedural forms, and regulatory clarifications. To understand why a seven-day delay or a wrong clause selection can make or break a trust’s exemption, it’s essential to map the legal architecture and the recent reforms that have shifted the ground beneath applicants’ feet.

Mapping the Registration Maze: Provisional and Regular Registration

At the heart of the process lies Section 12A(1)(ac), which prescribes the conditions for registration of charitable trusts and institutions. The law now distinguishes between:

• Provisional Registration: Granted via Form 10AC, typically under Section 12A(1)(ac)(vi)(A), this is for trusts that have not yet commenced activities. It acts as a temporary shield, allowing the entity to operate while it gears up for full compliance.
• Regular Registration: Sought through Form 10AB, this is the main gateway to long-term exemption. The form must be filed under the correct sub-clause—(i) to (vi)—depending on the trust’s status, history, and activities. For instance, sub-clause (iii) applies when activities have commenced after provisional registration, while (vi)(A) and (vi)(B) distinguish between trusts that have or have not started activities.

Each clause comes with its own eligibility criteria and, crucially, its own timeline for application.

Timelines: Where Minor Errors Become Major Hurdles

The law is unforgiving when it comes to deadlines. For example:

• Under sub-clause (iii), the trust must apply for regular registration at least six months before the expiry of provisional registration or within six months from commencement of activities, whichever is earlier.
• For clause (vi), the timing depends on whether activities have commenced (Item ‘A’ for not commenced, Item ‘B’ for commenced but no exemption claimed).

These timelines are not mere formalities. Even a small miscalculation—such as misunderstanding when “activities” are deemed to have started—can push an application outside the permitted window. The result? A technical delay that, until recently, could mean outright rejection and loss of exemption.

CBDT Circular No. 7/2024: Acknowledging Systemic Confusion

Recognising the widespread confusion, the CBDT issued Circular No. 7/2024 in April 2024. The Circular candidly admits that many applicants have made mistakes in selecting the correct section code or clause in Form 10AB, often due to the complexity of the new regime and the design of the online portal. To address this, the CBDT granted a one-time relaxation, allowing trusts to rectify such errors by refiling under the correct code up to 30 June 2024.

This is more than just a procedural concession. It is an official acknowledgment that the system itself is prone to generating bona fide errors, and that such mistakes should not be treated as fatal. The Circular thus sets the stage for a more liberal, substance-over-form approach to compliance.

The New Proviso: Discretion and Fairness Enter the Scene

The real game-changer, however, is the new proviso to Section 12A(1)(ac), effective from 1 October 2024. The text is simple but powerful: if an application under any of the sub-clauses (i) to (vi) is filed late, the Principal Commissioner or Commissioner may condone the delay if there is a “reasonable cause.” Once condoned, the application is deemed to have been filed within time.

This marks a decisive shift from rigid, mechanical rejection to a regime where discretion and fairness are built into the process. The Commissioner is now legally obliged to consider whether the delay was excusable, rather than simply ticking a box and issuing a rejection. For applicants, this means that minor, bona fide lapses—especially those arising from genuine confusion or administrative hurdles—can be cured, provided they are properly explained and documented.

Key Takeaways for Trusts, NGOs, and Professionals

• The law now recognises that procedural errors—especially in a complex, evolving regime—are often inevitable and should not automatically disqualify genuine applicants.
• The CBDT’s own Circular and the new proviso together create a strong legal basis for seeking condonation of minor delays and technical mistakes.
• The onus is on applicants to demonstrate “reasonable cause” and to present their case with clarity and supporting evidence.

In the next part, we’ll see how these principles played out in the Ramtirth Godavari Seva Samiti case, and what practical lessons can be drawn for trusts, NGOs, and their advisors. For detailed assistance, explore our NGO Services which cover all aspects of charitable trust registration and compliance.

The Ramtirth Godavari Seva Samiti Order: What Did ITAT Pune Actually Decide?

The ITAT Pune’s decision in Ramtirth Godavari Seva Samiti vs CIT is more than a routine remand—it’s a judicial signal to both tax authorities and the charitable sector on how to approach minor, bona fide lapses in the new Section 12AB regime. Let’s break down the facts, the Tribunal’s reasoning, and the practical principles that emerge.

Key Facts: A Timeline of Events and Errors

• July 2023: The trust commences its charitable activities.
• 08.07.2024: Provisional registration is granted in Form 10AC under Section 12A(1)(ac)(vi) – Item ‘A’ (meant for trusts that have not commenced activities).
• 27.03.2025: The trust files Form 10AB for regular registration, but under Section 12A(1)(ac)(iii)—a clause not strictly matching its factual position.
• CIT(E)’s Objection: The Commissioner notes two issues:
• Since activities had already commenced before provisional registration, the trust should have applied under Section 12A(1)(ac)(vi) – Item ‘B’ (for trusts that have commenced activities but not yet claimed exemption).
• The application was filed 7 days after the extended deadline allowed by CBDT Circular No. 7/2024.

The result? The application was rejected on both technical grounds: wrong clause and minor delay.

How ITAT Pune Viewed Delay and Clause Selection

The Tribunal’s approach was refreshingly pragmatic:

• Circular 7/2024 as Context: ITAT acknowledged that the CBDT itself had recognised widespread confusion and bona fide mistakes in clause selection, granting a one-time relaxation up to 30.06.2024. The trust’s delay—just 7 days beyond this window—was not seen as a willful default but as a minor, understandable slip in a complex compliance environment.
• Minor, Bona Fide Delay: The Tribunal highlighted that the delay was short and not motivated by any intent to evade tax or gain undue benefit. The trust had, in fact, been proactive in seeking registration and had supporting documentation (including evidence of seeking post-facto permission from the Charity Commissioner).
• The New Proviso as a Guiding Principle: Even though the new proviso to Section 12A(1)(ac) (empowering the Commissioner to condone delay) was not yet in force for the period in question, the ITAT treated it as a reflection of legislative intent. The Tribunal reasoned that, in light of this upcoming change, the Commissioner should have at least considered condonation rather than rejecting the application outright.

Operative Directions: What the Tribunal Ordered

• Order Set Aside: The ITAT set aside the CIT(E)’s rejection order.
• Remand with Specific Direction: The matter was remanded to the CIT(E) with a clear instruction: condone the delay and decide the application afresh on its merits, after giving the trust a reasonable opportunity to be heard.
• Embedded Legal Principles:
• Liberal Interpretation: Minor, bona fide non-compliance—especially in a regime acknowledged as confusing by the CBDT—should not be treated as fatal.
• Prospective Law as Interpretive Guide: Even before the new proviso’s effective date, its spirit should inform the exercise of discretion.

What This Means for Trusts, NGOs, and Professionals

The ITAT Pune order is a practical playbook for both applicants and their advisors:

• Don’t Assume All Errors Are Fatal: If the delay is minor and the error is bona fide, there is now a strong legal and policy basis to seek condonation.
• Document, Explain, and Argue: The onus is on the applicant to show the delay was not intentional and to provide a clear, well-supported explanation.
• Use the New Proviso and Circular as Leverage: Even for applications filed before 01.10.2024, the new legal framework and the CBDT’s own admissions can be cited to support a liberal, substance-over-form approach.

Those in Moradabad looking for expert advice on compliance nuances can benefit from specialized consultation.

Key Takeaway

The ITAT Pune’s decision transforms the condonation of minor, bona fide delays from a matter of administrative grace to a question of legal right—provided the applicant can demonstrate genuine intent and reasonable cause. For trusts and NGOs, this is a crucial shift: procedural landmines can now be navigated with the right mix of documentation, advocacy, and reliance on evolving jurisprudence.

In the next part, we’ll explore what counts as “reasonable cause” for delay, how to document it, and how to distinguish between curable lapses and more serious compliance failures.

If you need assistance with trust registration, tax exemptions, or compliance, you may explore our wide range of NGO services tailored to simplify this complex process.