Rectification under Section 154 invalid where statutory auditor form was filed timely, so charitable exemption reinstated.

Rectification under Section 154 removed a charitable exemption because the assessing officer/CPC found Form 10B not filed; the tribunal examined filing acknowledgements and extended due dates and concluded the statutory form was uploaded before the relevant return due dates, so the factual basis for disallowance was absent. Because the exemption had been allowed in the original intimation under Section 143(1), the rectification based on non-filing was invalid and the rectification orders were set aside, with appeals allowed for the assessment years concerned.

---

---

Issues: Whether the rectification under Section 154 of the Income-tax Act, 1961, which disallowed exemption claimed under Section 11 of the Income-tax Act, 1961, was valid where the assessee had filed/uploaded Form 10B before the due date for filing the return for the relevant assessment years.

Analysis: The appeals concern rectification orders under Section 154 of the Income-tax Act, 1961, which removed the exemption claimed under Section 11 of the Income-tax Act, 1961, on the ground that Form 10B had not been filed. For AY 2021-22 the assessee produced an acknowledgement showing Form 10B was uploaded on 10.01.2022. For AY 2015-16 the assessee produced ITR-7 extracts showing the auditor's report/Form 10B dated 12.10.2015, which was before the extended due date of filing the return. The Tribunal examined the record acknowledgements and the due date extension and found that the assessing officer and the CPC erred in concluding that Form 10B was not filed or was untimely. The rectification under Section 154 cannot stand where factual record demonstrates timely filing of the required statutory form and the exemption under Section 11 had been originally allowed in the intimation under Section 143(1) of the Income-tax Act, 1961.

Conclusion: The rectification orders under Section 154 of the Income-tax Act, 1961, which disallowed the exemption under Section 11 of the Income-tax Act, 1961, are set aside and the appeals are allowed in favour of the assessee for the assessment years concerned.

---