TaxTMI 
TaxTMI 
2024 (11) TMI 769
X X X X Extracts X X X X
X X X X Extracts X X X X
....y the learned CIT (A) u/s 250 of the Act, dated 8/3/.2024 is erroneous both on facts and in law to the extent the order is prejudicial to the interest of the appellant. 2. The learned CIT (A) erred in rejecting the petition for condonation of delay in filing of the appeal when the delay is unintentional and the appellant has a reasonable cause for the said delay. 3. The learned CIT (A) ought to have appreciated the fact that the delay in filing of the appeal is due to COVID-19 pandemic and post COVID effect and that the delay is due to reasons which are beyond the control of the appellant. 4. The learned CIT (A) erred in confirming the disallowance of entire expenditure claimed by the assessee amounting to Rs. 8,31,74,000/- which is exempt as per the provisions of section 11 of the I.T. Act, 1961. 5. The learned CIT (A) erred in not appreciating that the entire amount of Rs. 8,31,74,000/- has been duly has been duly expended towards the objects of the Trust on Revenue account and Capital account which is clearly evident from the return of income filed. 6. The learned CIT (A) ought to have appreciated that the assessee has duly complied with the provisions of section 11 of....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... appeal over 189 days after the extension granted by the Supreme Court. The learned CIT (A) issued a show cause notice dated 19/12/2023 to the appellant as to why the appeal should not be dismissed since the DGIT (Inv.) Hyderabad has rejected the application for condonation of delay for filing of Form 10BB to which the appellant filed written submissions on 29/12/2023. The learned CIT (A) after considering the relevant submission of the assessee the learned CIT (A) stated that since the DGIT(Inv) rejected Form 10BB for condonation of delay vide order u/s 119(2)(b) dated 6/10/2023, the entire gross receipts of the appellant amounting to Rs. 8,31,74,800/- are to be treated as income of the appellant for the A.Y 2019-20. 5. Further, according to the learned CIT (A), the Audit Report u/s 12A(1)(b) has to be filed by a charitable or religious trust or institution who has been granted registration u/s 12A or who has submitted an application for registration by filing Form 10A, if the total income of the entity for the relevant previous year has exceeded the maximum amount which is not chargeable to tax, to claim exemption u/s 11 and 12 of the I.T. Act, 1961. The accounts of such Trust/I....
X X X X Extracts X X X X
X X X X Extracts X X X X
....CIT (A) ignoring all facts, rejected the exemption u/s 11 of the Act, only on the ground that the petition filed by the assessee for condonation of delay before the DGIT (Inv) has been rejected by the authorities. The learned Counsel for the assessee further submitted that first of all, as per the Board's Circular No.15 of 2022, dated 19/07/2022, when delay is up to 365 days, the CITs are authorized to admit application for condonation of delay u/s 119(2)(b) of the Act. In the present case, if we exclude the delay of 805 days which is covered under Covid-19 period, the balance delay is only 231 days and thus, the appellant should have filed application before the CIT but not before the DGIT. Since the appellants have filed applications for condonation of delay under wrong forum or authority, it has filed further application before the CBDT for condonation of delay. Therefore, the learned CIT (A) either condoned the delay on its own having noticed the reasons given by the assessee or kept the appeal in abeyance till the CBDT decides the application filed by the assessee by considering the order passed by the DGIT rejecting application filed by the assessee for condonation of delay. ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... appeal was filed only on 6/9/2022 after a delay of 250 days. The delay in filing of the appeal before the learned CIT (A) is covered by Covid period and non-covid period. Further, even if you exclude delay covered by Covid Period, in view of the decision of the Hon'ble Supreme Court in M.A. 21/2022, still there is delay of 189 in filing of the appeal for both the A.Ys. The appellant explained the reasons for delay in filing of the appeal and according to the assessee, because of Covid period, the order passed u/s 143(1) of the Act, was not brought to notice of the management and it missed the attention of the management. However, once the covid pandemic is subsided, the appellant took steps to file the appeal and in the process, there is a delay. However, the said delay is neither intentional nor wanton of any undue benefit. In our considered view, during the Covid period, the normal life of a person be it an individual or a company was badly affected due to various reasons including lock down imposed by the government from time to time. Further, the covid pandemic is also disturbed the normal life of many people and because of these reasons, many people could not attend their....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ot complete books of account for the relevant A.Ys and because of this reason, the Auditor could not complete the audit and issued report in Form 10BB before the assessee filed its return of income. However, the appellant has obtained relevant audit report in Form 10BB for both the A.Ys and filed before the learned CIT (A) during the appellate proceedings and argued that delay in filing Form 10BB may be condoned. 11. We find that in order to claim deduction u/s 11 of the I.T. Act, 1961, any Trust or Institution claiming exemption should obtain audit report and filed one month before the due date for furnishing return of income u/s 139(1) of the I.T. Act, 1961. In case, there is a delay in filing of audit report in Form 10BB, the Board has issued a Circular No.15 of 2022, dated 19/07/2022 and authorized its Officers to condone the delay up to a period of 3 years. In case of delay up to 365 days, the CIT is authorized to condone the delay and in case the delay is more than 365 days and up to 3 years, the CCIT/DGIT is authorized to condone the delay. In the present case, the appellant filed application for condonation of delay in filing Form 10BB before the DGIT and application filed....
X X X X Extracts X X X X
X X X X Extracts X X X X
....sessing Officer and also direct the Assessing Officer to decide the issue of exemption u/s 11 of the Act, for both the A.Ys after the outcome of the application, if any, filed by the assessee, before the CBDT for condonation of delay in filing Form 10BB for both the A.Ys. 12. In so far as various case laws relied upon by the learned Counsel for the assessee including the decision of the Hon'ble Bombay High Court in the case of CIT vs. Xavier Kalavani Mandal (P) Ltd, we find that in all those cases, the issue before the Hon'ble High Court was whether belated filing of Form 10BB can be considered, if such Form 10BB has been filed on or before the Assessing Officer passed the assessment order u/s 143(1) or 143(3) of the I.T. Act, 1961. Further, in all those cases, the audit report in Form 10BB has been filed on or before the Assessing Officer passed the assessment order. In the present case, the appellant has filed Audit Report in Form 10BB after the Assessing Officer passed the assessment order u/s 143(1) of the I.T. Act, 1961. Therefore, in our considered view, the case laws referred to by the assessee in support of its argument is not applicable to the facts of the present....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... at all, the claim of the assessee is correct, then, in our considered view, the Assessing Officer is grossly erred in taxing gross receipts because in any case, the appellant needs to be assessed as an AOP on surplus/profit only. Therefore, we direct the Assessing Officer to verify the claim of the assessee and in case as claimed by the assessee, if the gross receipts are brought to tax, then the Assessing Officer is directed to assess only income/profit to tax for both the A.Ys, in case finally the Assessing Officer holds that the assessee is not entitled for exemption u/s 11 of the I.T. Act, 1961. 15. In the result, appeal filed by the assessee for the A.Ys 2019-20 & 2020-21 in ITA Nos. 394 & 395/Hyd/2024 are allowed for statistical purposes. ITA Nos.476 & 393/Hyd/2024 (Aurora Educational Society) 16. The facts and issues involved in these two appeals filed by the assessee for A.Ys 2019-20 and 2020-21 are identical to the facts and issues, which we had considered in ITA Nos.394 & 395/Hyd/2024, in the case of Church Educational Society. But for figures, the facts and issues are similar to the issues in the case of Church Educational Society. Therefore, the reasons given by us ....