TaxTMI 
TaxTMI 
2022 (6) TMI 1153
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....ncome. The return was processed under section 143(1) by intimation order dated 15.9.2016 denying the claim of deduction of Rs.20 lakhs under section 11(2) of the Act and demanded a tax of Rs.2,86,525/-. As against the intimation order, the assessee filed rectification petition under section 154 of the Act, claiming that the assessee failed to file Form No.10 along with return of 1.10.2015. However, Form No.10 was uploaded by online on 2.1.2017 thereby the assessee requested the ld.AO to grant deduction of Rs.20.00 lakhs under section 11(2) of the Act. The assessee further claimed that there was no regular assessment under section 143(3) for the Asst.Year 2015-16, hence, the Form No.10 filed online on 2.1.2017 was to be taken into consideration by the AO, while passing the order under section 154 of the Act. The assessee has also further submitted that the filing of the Form No.10 along with return of income is mandatory w.e.f. 1.4.2016 i.e for the Asst.Year 2016-17 onwards. However, the rectification application was rejected by the DCIT(CPC) vide order dated 31.10.2019 as follows: "Subject: Rejection of request for Rectification, Under Section 154 of the Income Tax Act, 19....
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.... not in doubt; (b) that the failure to give notice to the Income-tax Officer under section 11(2) of the Act and investment of the money in the prescribed securities was due only to oversight; (c) that the trustees or the settlor have not been benefited by such failure directly or indirectly; (d) that the trust agrees to deposit its funds in the prescribed securities prior to the issue of the Government sanction extending the time under section 11(2); and (e) that the accumulation or setting apart of income was necessary for carrying out the objects of the trust." 4.1 The assessee has also drawn attention to Circular No.14 (XI- 35) of 1955 dated 11.4.1955 issued by the CBDT, which is reproduced as under: " Officers of the Department must not take advantage of ignorance of an assessee as to his rights. It is one of their duties to assist a taxpayer in every reasonable way, particularly in the matter of claiming and securing reliefs and in this regard the Officers should take the initiative in guiding a taxpayer where proceedings or other particulars before them indicate that some refund or relief is due to him. This attitude would, in t....
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....efore the assessment proceedings. Further, any claim for giving the benefit of section 11 on the basis of information supplied subsequent to the completion of assessment would mean that the assessment order will have to be reopened. In our opinion, the Act does not contemplate such reopening of the assessment. In the case at hand it is evident from the records of the case that the respondent did not furnish the required information till after the assessments for the relevant years were completed. In the light of the above, we are of the opinion that the stand of the revenue that the High Court erred in answering the first question in favour of the assessee is correct, and we reverse that finding and answer the said question in the negative and against the assessee. In view of our answer to the first question, we agree with Mr. Verma that it is not necessary to answer the second question on the facts of the case. 7. In view of the above findings of ours, the second question referred will not arise for consideration. Accordingly, these appeals are allowed." 4.3 The assessee further relied on jurisdictional High Court in the case of CIT Vs. Mayur Foundation 274 ITR 562 whe....
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....deduction/exemption of Rs.20,00,000/-claimed u/s.11 (2). Appellant filed Form No.10 electronically on 2/1/2017 and requested the CPC to pass the rectification order u/s. 154. CPC rejected the rectification application stating - "There is no prima facie error in the order which was sought to be rectified" Form No. 10 was not there when the Intimation u/s 143(1) was passed. Hence not considering Form No. 10 does not constitute a mistake which is apparent from record. Hence the same cannot be rectified u/s 154. For the above stated reasons rejecting the rectification request of the appellant is upheld. 7. In result, the appeal of the assessee is dismissed." 6. The ld.counsel for the assessee submitted that by way of intimation under section 143(1), CPC denied the claim of deduction under section 11(2) and raised a tax demand. When rectification petition u/s.154 was filed to rectify the mistake, after filing Form No.10 on 2.1.2017 and also indicated that Form No.10 is required to be filed along return w.e.f. 1.4.2016 i.e. Asst.Year 2016-17 only. Though the assessee uploaded Form NO.10 belatedly with request to rectify the mistake, but CPC....
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....ges, but passed cryptic order by simply dismissing the appeal of the assessee on the ground that no mistake apparent from record. Thus, ld.CIT(A), NFAC miserably failed in adjudicating the appeal filed before it, without application of mind as well as not considering the written submissions placed before it, and passed the impugned order. 9. As rightly pointed out by the ld.AR, there are circulars issued by the CBDT as early as 1955 wherein the officers have been directed not to take advantage of ignorance of an assessee as to their right, and one of the duties of the officers is to assist a taxpayer in every reasonable way particularly in the matter of claiming of refund or relief. Thus, the Officers should take the initiative in guiding a taxpayer. This attitude would in the long run benefit the department because it would inspire confidence in assessee that he may be sure of getting a square deal from the department. 10. It is appropriate to consider sub-section 9 of section 139 of the Act provides as follows: Section 139(9) Where the [Assessing] Officer considers that the return of income furnished by the assessee is defective, he may intimate the defect....
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....imation required under section 11 in form No.10 has to be furnished before the assessing authority completes the concerned assessment. 13. We observe that the ld.CIT(A) failed to consider insertion of sub-clause (c) to section 11(2) by the Finance Act, 2015 which reads as under: "Section 11(2) as applicable for AY 2016-17: "(2) Where eighty-five percent of the income referred to in clause (a) or clause (b) o f sub-section (1) read with the Explanation to that subsection is not applied, or is not deemed to have been applied, to charitable or religious purposes in India during the previous year but is accumulated or set apart, either in whole or in part, for application to such purposes in India, such income so accumulated or set apart shall not be included in the total income of the previous year of the person in receipt of the income, provided the following conditions are complied with namely:- (a) such person furnishes a statement in the prescribed form and in the prescribed manner to the Assessing Officer, stating the purpose for which the income is being accumulated or set apart and the period for which the income is to be accumulated or set apart, ....
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....er, who is performing a quasi-judicial function. The soul of a quasi-judicial decision making is in the reasoning for coming to the decision taken by the quasi-judicial officer. While on this aspect of the matter, we may usefully refer to the observations made by the Hon'ble Supreme Court, in the case of Union Public Service Commission v. Bibhu Prasad Sarangi and Ors., [2021] 4 SCC 516. While these observations are in the context of the judicial officers, these observations will be equally applicable to the decisions by the quasi-judicial officers like us, as indeed the Assessing Officer CPC. In the inimitable words of Hon'ble Justice Chandrachud, Hon'ble Supreme Court has made the following observations: ..... Reasons constitute the soul of a judicial decision. Without them, one is left with a shell. The shell provides neither solace nor satisfaction to the litigant. We are constrained to make these observations since what we have encountered in this case is no longer an isolated aberration. This has become a recurring phenomenon. .........How judges communicate in their judgments is a defining characteristic of the judicial process. While it is important to k....