2023 (5) TMI 1140 - AT - Income Tax

Appeal dismissed for deduction denial under Income-tax Act; strict compliance emphasized.

The appeal was dismissed, upholding the denial of the deduction under section 80IB (11A) of the Income-tax Act, 1961. The Judicial Member emphasized the ... Deduction u/s 80IB - audit report in the prescribed Form 10CCB was filed beyond the stipulated time period - delay occurred due to technical glitches during critical phase of pandemic COVID-19 - HELD THAT:- It settled position of law as laid down in the case of Dilip Kumar and Company (2018 (7) TMI 1826 - SUPREME COURT] that the assessee in the present case had failed to strictly comply with the innate statutory requirements contemplated in section 80IB (11A) r.w. 80IB(13) r.w.80IA(7) of the Act, which in clear and unequivocal terms disentitles an assessee from claiming deduction u/s 80IB of the Act, if it had, inter alia, failed to furnish the audit report in Form 10CCB r.w. 18 BBB before the specified date referred to Section 44AB of the Act, therefore, the lower authorities have rightly declined her claim for deduction u/s.80IB of the Act. As the assessee had failed to comply with the statutory conditions which rendered her eligible for claiming deduction u/s.80IB of the Act, therefore, finding no infirmity in the view taken by the lower authorities who had rightly declined her claim for deduction. Decided against assessee. Issues involved:The judgment involves the denial of deduction under section 80IB of the Income-tax Act, 1961 due to delayed filing of Audit Report in Form 10CCB by the assessee, leading to an appeal against the order passed by the Commissioner of Income-Tax (Appeals), National Faceless Appeal Center (NFAC), Delhi.Comprehensive Details:Issue 1: Denial of Deduction under Section 80IBThe controversy in the appeal revolves around the sustainability of the decision by the lower authorities to decline the assessee's claim for deduction under section 80IB (11A) of the Act amounting to Rs.16,86,650, citing the delayed filing of the audit report in Form 10CCB beyond the stipulated time period.Issue 2: Lack of Appearance by AssesseeThe assessee failed to appear for the appeal hearing or request an adjournment, prompting the Judicial Member to proceed with the appeal based on Rule 24 of the Appellate Tribunal Rules, 1963, after considering the respondent revenue's arguments and lower authorities' orders.Issue 3: Compliance with Statutory RequirementsThe Judicial Member examined the statutory requirements under section 80IB (11A) r.w. 80IB (13) r.w. 80IA (7) of the Act, emphasizing the necessity for the audit report in Form 10CCB to be filed within the extended time period, as mandated by Circular No.01/2022, failing which the deduction claim could be rightfully declined.Judicial Analysis:The Judicial Member, after considering the contentions and orders of the lower authorities, upheld the denial of the deduction under section 80IB (11A) of the Act. The Member highlighted the importance of strict compliance with statutory conditions for claiming deductions, as established by the Hon'ble Supreme Court's precedent in Commissioner of Customs (Import) Mumbai vs. Dilip Kumar and Company. The judgment emphasized that exemptions must be claimed by meeting all specified conditions, and any ambiguity in exemption clauses should be construed strictly against the assessee.Conclusion:Based on the failure of the assessee to adhere to the statutory requirements for claiming deduction under section 80IB of the Act, the appeal was dismissed, affirming the decision of the lower authorities. The judgment was pronounced on 26th May 2023 by the Judicial Member, Shri Ravish Sood.