Income Tax Appeal: Assessee wins accumulation benefit under section 11(2)

The Tribunal allowed the Assessee's appeal, directing the Assessing Officer to grant the benefit of accumulation claimed under section 11(2) of the Income Tax Act, 1961. The decision was based on the timely filing of Form-10 during the assessment proceedings, as per the Chandigarh Tribunal's precedent.

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Issues Involved:
1. Denial of exemption under section 11(2) of the Income Tax Act, 1961.
2. Rejection of benefit of accumulation of Rs.10,36,657 under section 11(2) of the Act.

Issue 1: Denial of exemption under section 11(2) of the Income Tax Act, 1961:
The appeal was filed against the order of the National Faceless Appeal Centre (NFAC) in relation to the Assessment Year 2018-19. The Assessee, a Trust, had filed its original return of income and later a revised return declaring total income at Rs.NIL. The Assessing Officer (A.O.) determined the total income at Rs.10,36,657 by denying the exemption under section 11(2) of the Act. The Assessee appealed before the Ld. CIT(A) and subsequently to the NFAC, where the appeal was dismissed. The Assessee then approached the Tribunal challenging the rejection of the benefit of accumulation under section 11(2) of the Act.

Issue 2: Rejection of benefit of accumulation of Rs.10,36,657 under section 11(2) of the Act:
The Assessee was required to file Form-10 for claiming exemption under section 11(2) by a specified date, which was filed late along with the revised return. The CPC disallowed the claim due to the delayed filing. The Appellate Authority upheld the disallowance. The Assessee argued that the delay did not prejudice the Revenue and cited a decision by ITAT, Chandigarh Tribunal. The Assessee also referred to a CBDT Circular allowing delayed applications. The Tribunal noted that Form-10 was filed before the completion of assessment and relied on the Chandigarh Tribunal's decision, directing the A.O. to allow the benefit of accumulation under section 11(2) of the Act. The Tribunal found no contrary binding decision or material against the Chandigarh Tribunal's ruling, thus allowing the Assessee's appeal.

In conclusion, the Tribunal allowed the Assessee's appeal, directing the Assessing Officer to grant the benefit of accumulation claimed under section 11(2) of the Income Tax Act, 1961. The decision was based on the timely filing of Form-10 during the assessment proceedings, as per the Chandigarh Tribunal's precedent.

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