Substantial compliance for exemption claims: later validation of Form 10BB did not defeat section 10(23C)(vi) relief.

Where Form 10BB is obtained and uploaded with the return within time, later digital validation alone does not justify denial of exemption under section 10(23C)(vi). The operative point is substantial compliance with the filing requirement: if the return is filed within the extended due date and the prescribed report is already attached and digitally signed on the same date, the exemption claim should not be treated as invalid merely because formal verification occurred later. On these facts, the adverse assessment consequence was set aside and the exemption claim was allowed.

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Issues: Whether the exemption under section 10(23C)(vi) of the Income-tax Act, 1961 could be denied merely because Form 10BB was validated after filing of the return, when the form had been obtained and uploaded along with the return.

Analysis: The return for the relevant year was filed within the extended due date, and Form 10BB had been obtained before filing and was uploaded with the return. The acknowledgement showed that the form was digitally signed on the same date as the return filing, even though formal validation occurred later. On these facts, the filing requirement stood complied with and there was no basis to treat the exemption claim as invalid merely on account of the later verification date.

Conclusion: The denial of exemption was not justified and the assessee was entitled to the claim under section 10(23C)(vi).

Final Conclusion: The exemption claim was restored and the assessment consequence adverse to the assessee was set aside, resulting in relief to the assessee.

Ratio Decidendi: Where the prescribed report is obtained and uploaded with the return within time, later digital verification alone does not justify denial of exemption if the statutory filing requirement is substantially complied with.

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