Delayed return filing and Form 10B exemption issue remanded for fresh consideration after unexamined Covid-related extension claim.

Denial of exemption based on delayed filing of the return and Form 10B was not finally sustained, because the appellate authority had not examined the assessee's contention that the delay in filing the return was linked to the Covid period and that applicable extensions or reliefs may apply. As the first appellate authority did not adjudicate the issue on merits, the matter was set aside for fresh consideration. The assessee was to be given an opportunity of hearing, and the dispute was remitted for de novo adjudication in accordance with law.

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Issues: Whether the denial of exemption on account of delayed filing of the return and Form 10B was sustainable, and whether the matter required reconsideration by the appellate authority.

Analysis: The assessee's registration under section 12AB, the delayed filing of the return, and the condonation granted for filing Form 10B were not in dispute. The appellate authority had not examined the assessee's contention that the delay in filing the return was linked to the Covid period and whether the relevant extensions or reliefs were applicable. Since the issue raised before the first appellate authority was not adjudicated on merits, further examination was necessary. The appropriate course was to set aside the matter for fresh consideration after giving the assessee an opportunity of hearing.

Conclusion: The matter was remitted to the appellate authority for de novo adjudication in accordance with law, with due opportunity of hearing to the assessee.

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