TaxTMI 
TaxTMI 
2024 (4) TMI 92
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....sessee institution is a Charitable Trust duly registered under section 12A of the IT Act, 1961. This trust is an State Government Controlled working for the aid and assistance of the poor, needy and downtrodden. On receipt of intimation under section 143(1) of the IT Act, 1961, the assessee filed a rectification application under the impression that the authorities will look into the entirety of the details filed in the ITR submitted and not limit itself to the claim made erroneously under section 11 of the IT Act, 1961. It shall be observed that as per the details filed in the ITR there is a net loss as per Income and Expenditure account and there was no necessity for claim made under section 11 of the IT Act, 1961. If any erroneous claim has been made by the assessee that should have been ignored and assessment made on the basis of details filed in the ITR filed. Unfortunately, the same has not been the course of action of the authorities who have only limited there perception on claim made under section 11 of the IT Act, 1961 and as the assessee had not uploaded the Audit Report disallowed the claim under section 11 of the IT Act, 1961 in view of the provisions under section 12A....
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....e. As per appellant, it operates through various Rajasthan Government agencies for creating medical facilities and there was a delay in receipt of accounts from those agencies and hence delay in audit of the accounts, filing of return etc. Wherever there is a delay in filing of Form 10B, an assessee is required to file an application for condonation of delay. Where there is delay of beyond 365 days upto three years in filing Form No. 10B for Assessment Year 2018-19 or for any subsequent Assessment Years, the CBDT Circular No.16 of 2022 authorizes Pr.CCIT/CCIT to admit application of condonation of delay under section 119(2) of the Act and decide the same on merits. Similar powers in respect of delay upto 365 days was given to the CIT (Exemption) vide CBDT Circular 2 of 2020 dated 03.01.2020. Thus, there is a laid down procedure for condonation of delay in filing of Form 10B, if there is a reasonable cause for such delay. The appellant has not mentioned anything about any pending application for condonation of delay in filing Form 10B, in its submission. The decisions relied upon by it are not applicable since there is a laid down procedure for condonation of delay for AY 2018-19.....
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.... these various agencies were not received in time which delayed the finalization of accounts and subsequent delay in audit of the accounts, which resulted in delayed filing of IT Return and uploading of Audit Report. In this regard it was submitted before the Learned CIT(A-NFAC) that even if the Form No. 10B is filed at a later stage, either before the A.O. or before the appellate authorities, it would be a sufficient compliance with requirements of section 12A(1)(b) as these requirements are only directory in nature. This is the view expressed by the Honourable Gujarat High Court in the case of CIT vs. Xavier Kelavani Mandal (P) Ltd as reported 41 Taxmann.com. Furthermore, it was explained before the Learned (CIT-NFAC) that it is a sufficient compliance with the procedure, if the Audit Report u/s 12A(1)(b) is filed at any stage before the completion of assessment or even at the appellate stage. Thus the CPC cannot deny exemption available u/s 11 of the IT Act, 1961. This view finds strong support from the judicial pronouncements in the following decisions: 1. Sarvodaya Charitable Trust vs. ITO (Exemption) 125 Taxmann.com 75 (Gujarat) 2. CIT vs. Xavier Kelavani Mandal 41 Ta....
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.... procedure for condonation of delay for AY 2018-19. WE HAVE TO SUBMIT AS UNDER: The Learned CIT (A-NFAC) has based his decision on the assumption that the assessee appellant has not moved any application for condonation of delay in filing of Form 10B before the Appropriate Authorities and has totally overlooked the observations of the various Higher Courts that even if Form No. 10B is filed at a later stage before the A.O. or before the Appellate Authorities, it would be sufficient compliance with requirements of section 12A(1)(b) of the IT Act, 1961 as these requirements are only directory in nature. Furthermore, we have to submit that it is sufficient compliance with the procedure, if the Audit Report u/s 12A(1)(b) is filed at any stage before the completion of assessment or even at the appellate stage. Thus the CPC cannot deny exemption available u/s 11 of the IT Act, 1961. This view finds strong support from the judicial pronouncements in the following decisions: 1. Sarvodaya Charitable Trust vs ITO (Exemption) 125 Taxmann.com 75 (Gujarat) 2. CIT vs Xavier Kelavani Mandal 41 Taxmann.com 184 (Gujarat) 3. Social Security Scheme of GICEA vs CIT (Exemption) 147 Taxmann.co....
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....n coming to a justifiable decision. In view of the above facts and position of law a considerate view may kindly be taken and appeal be allowed. " 6. The ld. AR of the assessee in addition submitted that the assessee cannot be denied the benefit of section 11 of the IT Act merely there is delay in filling the audit report. He further submitted that since the powers of the ld. CIT(A) are co-terminus with the powers of the assessing officer and he should have appreciated that the CBDT has extended the date of furnishing the declaration for the year under consideration up to 31.10.2018 based on the general public representation on account of the technicality of the filling of the said form and the assessee has ultimately submitted the same on 28.01.2020. Therefore, the demand raised in the intimation is incorrect and even the order passed u/s. 154 subsequently that is also incorrect and therefore, he prayed to grant the relief to the assessee. 7. The ld. DR heard who relied on the findings of the lower authorities and submitted that once the assessee failed to file the form no. 10B along with the return of income before the due date of filling the return of income, the assessee is....