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2025 (11) TMI 1853
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....18th June 2024 passed by Respondent No. 1 under Section 119(2)(b) of the Income Tax Act, 1961 (for short "IT Act") rejecting the Application for condonation of delay in filing Form 10B by the Petitioner for A.Y.2017-18. As a result of this, the Petitioner Trust has been denied the benefit of exemption under Section 11 of the Act. 3. Brief facts of the case are that the Petitioner is a Charitable Institution (earlier known as New Kalamboli Education Society) engaged in the field of education and runs a school with a total strength of around 5,000 students in both English and Marathi medium. The Petitioner filed its return of income on 8th March 2019 for the relevant A.Y. 2017-18 in response to a Notice issued under Section 142(1) of the A....
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....tion 12A(1)(b) of the Income Tax Act read with 1st Proviso to Rule 12(2) of the Income Tax Rules, the audit report Form 10B has to be E-filed along with return of income. Hence exemption u/s 11 is not allowable". 5. The Petitioner claims that upon realising the reason for denial of exemption under Section 11 of the Act, the Petitioner belatedly uploaded its Form No. 10B online on 9th December 2020. It is not in dispute that Form No. 10B was required to be uploaded online along with the Return of Income or before filing the Return of Income i.e. by 7th November 2017 and that the Petitioner uploaded the Form No. 10B online on 9th December 2020. As such, the delay in filing Form No. 10B is 1128 days. 6. In this factual backdrop, we have ....
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....ner Trust was entirely dependent on their Chartered Accountants for tax related compliances and therefore the delay. 8. Be that as it may, Mr. Walve submitted that the requirement of filing the Audit Report along with the Return of Income is procedural in nature and an Audit Report can be admitted subsequent to filing of the return also. In this regard, he relied on the judgment rendered by the Hon'ble Gujarat High Court in Sarvodaya Charitable Trust vs. Income Tax Officer. (Exemption) [2021] 125 taxmann.com 75 (Gujarat) to support his contention. For all the aforesaid reasons, Mr. Walve submitted that the impugned order dated 18th June 2024 be set aside, and the delay in filing Form 10B be condoned. 9. On the other hand, Mr. Saxena d....
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....ned, it is not in dispute that the delay is of 1128 days. The reason for such a delay is the misunderstanding between the Chartered Accountants as to their scope of work leading to the delay. The Petitioner being a Charitable Institution is solely dependent on professionals to meet their compliance requirements and one cannot completely rule out the possibility of such delays which may be caused due to sheer inadvertence and without any mala fide intent. This view is supported by a decision of a co-ordinate bench of this Court in Al Jamia Mohammediyah Education Society v. Commissioner of Income-tax (Exemptions) [2025] 482 ITR 41 (Bombay) wherein this Court condoned the delay in filing Form No. 10B under similar circumstances where the delay....
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....od of 3 years within which such an Application for condonation of delay had to be filed. Admittedly, in the present case, the Petitioner has filed an Application which was disposed of vide the Impugned Order much before Circular No. 16/2024 came into force, and thus, there was no impediment or strict time period within which the Petitioner was required to file such Application. Moreover, the Petitioner's Application has not been rejected on the ground of delay in approaching Respondent No. 1, but only on the ground that the Petitioner's explanation for the delay in filing Form 10B was not acceptable to Respondent No. 1. 12. We are satisfied with the explanation given in the Additional Affidavit for delay in filing Application for condona....
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.... This view is supported by the judgment of this Court in Western Arch Developers vs. Pr. Commissioner of Income tax-(Central) [2025] 177 taxmann.com 313 (Bombay) wherein one of was a member (B.P. Colabawalla, J). Thus, we find that on this count also, the delay deserves to be condoned. 15. We also rely on another judgment of this Court in St. Anne's Church vs. Commissioner of Income-tax (Exemptions) [2025] 178 taxmann.com 16 (Bombay) passed by the same bench under similar circumstances where it was observed that the Petitioner being a Charitable Trust would face grave hardship if the delay in filing Form No. 10 was not condoned and if exemption was denied to them only on this count. The Petitioner - Trust ought not to be foisted with suc....