2025 (12) TMI 967

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... 2. The assessee has raised the following grounds of appeal: "1.1 The order passed u/s 250 on 11.07.2025 passed by NFAC, CIT(A)/Addl./JCIT(A)-1, Chennai (for short 'CIT(A) whereby confirming the Intimation u/s. 143(1) passed on 29.01.2025 by CPC Bengaluru, disallowing the claim of exemption u/s 11 & 12 aggregating to Rs. 5,77,26,463/- for failure to file Form 10B within the prescribed time is wholly illegal, unlawful and against the principles of natural justice. 1.2 The Ld. CIT(A) has grievously erred in law and or on facts has failed to appreciate that there was sufficient cause for the failure to file Form 10B within the prescribed time so that the same should be condoned. 2.1 That in the facts and circumstan....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ire claim of exemption on the ground that Form 10B, which was required to be furnished at least one month before the due date for filing the return under section 139(1) of the Act, had not been filed. Instead, the assessee had filed Form 10BB on 25.09.2024 believing that it was eligible for exemption under section 10(23C). Upon realizing the legal position under section 11(7) that a trust registered under section 12A cannot simultaneously claim exemption under section 10(23C), the assessee filed Form 10B on 18.12.2024, which was admittedly beyond the prescribed timeline. The CPC therefore denied the exemption, thereby raising a tax demand of Rs. 26,57,210/-. 4. In appeal before CIT(A), the assessee argued that the failure to file Form 10....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... regular books, getting accounts audited, filing the return in time, and applying income for charitable purposes had been satisfied. The assessee relied on the decision of the ITAT Ahmedabad in Shree Vardhman Stanakvasi Jain Shravak Trust v. ITO, ITA No. 1881/Ahd/2024 (date of pronouncement: 14.02.2025) and other similar decisions which have held that (a) non-filing or late filing of Form 10B is a procedural defect, (b) exemption under sections 11 and 12 cannot be denied when the audit report becomes available before completion of assessment or appellate proceedings, and (c) if Form 10B is on record during appellate proceedings, the requirement of law is deemed satisfied. 6. In response, Ld. DR placed reliance on the observations made by....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....23) 157 taxmann.com 550 (Guj.). The Tribunal held that the High Court has laid down in no uncertain terms that although obtaining the audit report is a substantive condition, the time and mode of furnishing it are purely procedural. The High Court held that non-filing of the report along with the return is at best a procedural omission and cannot be an impediment to claiming exemption. In the case of Parul Mahila Pragati Mandal vs. Income-tax Officer (Exemption) [2025] 175 taxmann.com 922 (Gujarat)[30-04-2025], the High Court held that Filing of Form 10B is only a procedural requirement, and its non-filing with return does not bar exemption under section 11, and even if such Form is filed at a later stage, assessee will still be entitled to....