TaxTMI 
TaxTMI 
2024 (12) TMI 1260
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....record. The Assessee is a society registered under Societies Registration Act, 1860. The Assessee is registered pursuant to the statutory requirement of Pradhan Mantri Gram Sadak Yojana (PMGSY) of Government of India and has only executed Government Rural Road Project under the Ministry of Rural Development. The Memorandum and Articles of Association of the Assessee society are enclosed in pages 25 to 35 of the paper book. The Assessee during the year under consideration received gross receipts of grants of Rs. 891,27,72,793/-. The Assessee incurred expenses of Rs. 673,46,06,573/-. The return of income for the assessment year 2018-19 was filed belatedly under section 139(4) of the Act on 25-01-2019 declaring nil income after claiming exemption under section 11(1)(a) of Rs 133,69,15,919/- and under section 11(2) of the Act of Rs 83,73,77,381/-. These facts are evident from the ITR acknowledgement in ITR 7 read with copy of Form No. 9A, Form 10 , Form 10B and computation of income filed by the assessee along with the return of income. Admittedly, the return of income together with all the aforesaid documents which were filed by the assessee on 25.1.2019 falls within the time limit pr....
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....- vide his assessment order dated 21-04- 2021 on the ground that the income tax return was not filed before the due date prescribed under Section 139(1) of the Act. Therefore, he held that deduction under Section 11(2) read with Section 12A of the Act is not allowable to the Assessee. The Assessee filed an appeal before the Learned Commissioner Appeals who upheld the order of the Learned AO. 6. We find that both the authorities had observed that since the income tax return was not filed before the due date prescribed under section 139(1) of the Act by the Assessee, the deduction under section 11 of the Act would not be available to the Assessee. But on perusal of the provisions of section 12A(1)(b) of the Act as it stood for Assessment Year 2018-19 wherein the only condition is that audit report is to be filed along with the Return of Income. In the instant case, both the return of income as well as Form 10B audit report were filed together on 25-1-2019 which is well within the due date prescribed under section 139(4) of the Act. This is evident from Page 120 of the Paper Book. Hence Assessee would be entitled for deduction under section 11 of the Act. This view of ours is further....
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....t, 1961 the person in Receipt of the income has furnished the return of income for the previous year in accordance with the provisions of sub-section (4A) of section 139, within the time allowed under that section. Otherwise, the exemption u/s 11 i.e. sr. no. 4(i) and 4 viii in schedule Part BTI is not allowed". Based on this, exemption uls 11 of the Act has been denied to otherwise eligible trust, thereby creating huge demand. 2. In the matter, the memorandum explaining the relevant provisions of the Finance Bill, 2017 reads as under: "as per the existing provisions of said section, the entities registered Under section 12 AA are required to file return of income under sub- Section (4A) of section 139, if the total income without giving effect to the provisions of sections 11 and 12 exceeds the maximum amount which is not chargeable to income-tax. However, there is no clarity as to whether the said return of income is to be filed within time allowed u/s 139 of the Act or otherwise. In order to provide clarity in this regard, it is proposed to further amend section 12A so as to provide for further condition that the person in receipt of the income chargeable to income-Tax sha....
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....lease be rectified. From the circular, we note that an amendment was brought in by insertion of clause (ba) of section 12A(1) of the Act from 2018-19 onwards through which one of the requirements for claiming the benefit u/s 11 and 12 of the Act was to file the return of income within time allowed u/s 139(4A) of the Act. It seems that specially for A.Y 2018-19, when the Form ITR-7 was being processed and for such belated return, demand was raised, representations were received from various assessees on this issue. Taking note of this issue, the said CBDT Circular has issued and while dealing with this issue, the returns filed within the time allowed u/s 139 of the Act have been directed to be accepted for the purpose of considering benefit of deduction u/s 11 of the Act. Now, since only section 139 of the Act has been mentioned and does not specify whether it is about u/s 139(1) of the Act or section 139(5) of the Act, the view beneficial to the assessee needs to be accepted and, since section 139(1) and section 139(5) are part of section 139 only and in this section 139 and sub-section (5) provides the mechanism to file a belated return, therefore, for A.Y 2018-19, even if the ass....