Form 10CCB filing before section 139(1) due date is directory not mandatory for section 80-IA deduction claims

ITAT Delhi held that filing Form 10CCB before the due date under section 139(1) is directory, not mandatory, for claiming deduction under section 80-IA. Following precedents from Delhi, Allahabad, Uttarakhand, and Karnataka HCs, the tribunal ruled that if the audit report is filed before assessment framing, section 80IA(7) requirements are satisfied. The AO was directed to allow the claimed deduction, and the assessee's grounds were allowed.

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Issues involved:
The issue involves denial of deduction claimed u/s 80-IA of the Act for non-filing of Form 10CCB before the due date specified in section 44AB of the Act.

Summary of Judgment:

Issue 1: Filing of Form 10CCB along with the return before the due date for claiming deduction u/s 80IA of the Act

The assessee filed a return of income claiming deduction u/s 80IA of the Act but failed to file Form 10CCB before the due date specified u/s 139(1) of the Act. The ADIT(CPC) proposed disallowance of the deduction, which was later denied in the processed return u/s 143(1). The Ld.CIT(A) upheld the disallowance, stating that filing Form 10CCB along with the return is mandatory. However, the Tribunal referred to various High Court judgments and concluded that filing the audit report before the assessment is completed satisfies the requirement of section 80IA(7). The Tribunal held that filing Form 10CCB before the due date is directory, not mandatory, for claiming the deduction u/s 80IA of the Act.

Issue 2: Judicial precedents supporting the non-mandatory nature of filing Form 10CCB

The Ld. Counsel for the assessee relied on judgments of various High Courts, including the Delhi High Court and Madras High Court, which held that filing the audit report before the assessment is completed is sufficient to meet the requirements of section 80IA(7). The Tribunal also cited decisions of other Courts, such as the Gujarat High Court, Bombay High Court, and Punjab & Haryana High Court, which supported the view that filing the audit report before the assessment is only directory in nature. The Tribunal concluded that the consistent judicial precedents indicated that the requirement of filing Form 10CCB before the due date is not mandatory for claiming deduction u/s 80IA of the Act.

Outcome:
Based on the precedents and the interpretation of the law, the Tribunal held that filing Form 10CCB before the due date for filing the return of income u/s 139(1) is only directory and not mandatory for claiming deduction u/s 80IA of the Act. The Tribunal directed the AO to allow the deduction claimed u/s 80IA of the Act, and the grounds raised by the assessee were allowed. The appeal of the assessee was allowed as per the judgment pronounced on 30/01/2024.

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