In a significant relief to charitable and religious institutions, the Income Tax Department has now enabled the filing of condonation requests through Form 10AB on the e-filing portal. This facility follows the amendment introduced by the Finance Act (No. 2), 2024, specifically the proviso to clause (ac) of Section 12A(1) of the Income-tax Act, 1961.
The amendment empowers the Principal Commissioner or Commissioner of Income-tax to condone the delay in furnishing Form 10A for registration or approval under Section 12A, provided there is reasonable cause. This move aims to benefit trusts and institutions that missed the prescribed timelines for filing Form 10A and were at risk of losing their tax-exempt status.
Tax professionals and trustees are advised to carefully review their pending compliances and utilize the Form 10AB condonation mechanism to regularize their position and ensure continued eligibility under Section 12A.
Key Highlights
- New Facility: Condonation request via Form 10AB now available on the e-filing portal.
- Legal Backing: Enabled under the amended proviso to clause (ac) of Section 12A(1), as per Finance Act (No. 2), 2024.
- Who Benefits: Charitable trusts, religious institutions, and other non-profits that failed to file Form 10A on time.
- Action Required: File Form 10AB with appropriate reasoning for delay to seek condonation from the tax authorities.
This development is expected to provide major relief to thousands of trusts and institutions facing uncertainty over their tax exemption due to procedural delays.
CAclubindia
