In a significant move to support charitable trusts, funds, and institutions, the Central Board of Direct Taxes (CBDT) has issued Circular No. 06/2026. This circular brings much-needed relief by condoning the delay in filing Form No. 10AB, which is crucial for maintaining tax-exempt status for donations.
Here is a comprehensive breakdown of the circular and what it means for your institution:
1: The Rule for Section 80G Approvals Section 80G of the Income-tax Act, 1961 allows taxpayers to claim deductions on donations made to specified funds and institutions. To maintain this benefit, institutions whose approval is due to expire under clause (ii) of the first proviso to section 80G(5) are required to electronically file an application in Form No. 10AB. The law mandates that this form must be submitted at least six months before the current approval period expires.
2: Genuine Hardships and Missed Deadlines The CBDT received numerous representations from various funds and institutions whose approvals were set to expire on March 31, 2026. These organizations were supposed to file Form No. 10AB by the due date of September 30, 2025, but failed to do so. The institutions explained that the delays were due to bona fide (genuine) reasons and other circumstances. Missing the deadline created a genuine hardship, as it threatened their ability to receive tax-deductible donations.
3: CBDT Condones the Delay Recognizing the genuine difficulties faced by these institutions, the CBDT has stepped in to mitigate the hardship. Exercising its powers under Section 119(2)(b) of the Income Tax Act, 1961, read with Section 536(2) of the Income Tax Act, 2025, the Board has officially condoned the delay.
- Who is eligible? Any institution that filed Form No. 10AB electronically between October 1, 2025, and March 31, 2026.
- Next Steps: The jurisdictional Principal Commissioner of Income-tax (Pr. CIT) or Commissioner of Income-tax (CIT) is now authorized to review these delayed applications on their merits and must pass a final order on or before December 31, 2026.
4: Relief for Previously Rejected Applications The circular goes a step further to protect institutions that already faced rejection. If an institution filed Form No. 10AB electronically between October 1, 2025, and March 31, 2026, and their application was rejected solely because it missed the September 30, 2025 deadline, the CBDT states that the delay “shall be deemed to have been condoned” in those cases as well. The jurisdictional Pr. CIT or CIT is directed to re-evaluate these previously rejected applications based on their merits and issue an order on or before December 31, 2026.
5: A Word of Caution – No Automatic Approvals While the circular is highly accommodating regarding the missed deadline, the CBDT clarifies that condoning the delay does not equate to a guaranteed victory. The circular explicitly states that nothing within it should be construed as granting “automatic entitlement” to approval under Section 80G(5) of the Act or section 133(1)(b) of the I.T. Act, 2025. All applications will still be rigorously reviewed on their individual merits.