TaxTMI 
TaxTMI 
2026 (1) TMI 70
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....ultaneously denying the benefit of exemption u/s 11(1) and 11(2) of the Act. The income has been erroneously computed under normal provisions without granting the statutory exemptions available to a trust registered under the Act. Such an approach is contrary to the express provisions of the Act and unsupported by the facts on record. Therefore, the denial of exemption and consequent addition made to the total income is unjustified and deserves to be deleted in entirety. 3. Rs. 18,49,946/-: That the ld. CIT(A) erred in confirming the action of the AO/CPC Bangalore in denying the exemption w.r.t. Rs. 18,49,946/-u/s 11 and 12 of the Act claimed by the assessee for want of registration u/s 12AA of the Act though the appellant is a AOP-Trust and spent its income towards Charitable activities only. Therefore, the denial the benefit of S. 11 and 12 is totally contrary to the provisions of law and facts on the record and hence such benefit be allowed in full. 4. Alternatively, the ld. CIT(A) erred in confirming the action of the AO/CPC Bangalore in considering the gross receipt as taxable income, which is against the basic tenets of law where only the real income which i....
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....f exemption. He therefore pleaded that the order of the Ld.CIT(A)being incorrect in law be set aside and the assessee be granted exemption u/s 11/12 of the Act. Ld. DR, on the other hand relied on the order of the ld. CIT(A). 5. I have heard the rival contentions. The issue before me is the denial of exemption u/s. 11 of the Act to the assessee being a charitable trust on account of delay in filing Form 10BB. As rightly pointed out by the Ld. Counsel for the assessee Hon'ble High Courts and the coordinate Benches of the ITAT have consistently held the requirement of filing Form 10BB to be a mere procedural requirement and not a mandatory condition therefore holding the denial of deduction for the said reason to be not sustainable in law. It has been held that as long as the requisite form is filed and is made available during assessment proceedings for scrutiny, it is sufficient compliance with the condition of filing Form 10BB and the mere fact of delay in the same would not adversely affect the right of the assessee to claim exemption u/s. 11 of the Act. In this regard, I draw support from the judgment of the Hon'ble Gujarat High Court in the case of Commissioner of....
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....n) v. Anjana Foundation [2024] 168 taxmann.com 462 (Gujarat). Thus, it will be seen that the Petitioner-Assessee could not be denied the exemption merely because Form 10B was not filed within time. In such circumstances, the denial on the part of the Department to condone the delay in complying with the procedural requirement on the part of the Assessee would result in denial of a substantive right of the Assessee to claim an exemption, which would in turn, result in the Assessee having to pay the demanded amount, thereby unjustly enriching the Department. In such view of the matter in our opinion, the Petitioner would have been caused undue hardship which the Department could have alleviated by allowing the Assessee's application under Section 119(2)(b) of the Act, which is rejected only on the technical grounds. 7.2 This Court in several recent decisions, namely in the case of Royal Led Equipments (P.) Ltd. v. Chief Commissioner of Income-tax [2025] 174 taxmann.com 61 (Gujarat)/Special Civil Application No. 14786 of 2024 and in the case of Surat Smart City Development Ltd. v. Principal Commissioner of Income-tax [2024] 169 taxmann.com 222 (Gujarat)/Special Civil Appl....
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....elow the taxable limit, the assessee trust was not under an obligation to file return of income and therefore, also not an obligation to file Form 10B as well. Thirdly, delayed filing of Form 10B is a procedural defect and since the assessee trust had filed the same before Ld. JCIT(A) during the course of appellate proceedings, no disallowance was called for on account of late filing of said Form 10B. 10. On going through the various adjustments which have been incorporated under Section 143(1) of the Act, we are of the considered view that treatment of such corpus donation as voluntary donation falls outside the scope of adjustments contemplated under Section 143(1) of the Act, unless such incorrect claim is apparent from any information in the return of income. In the return of income filed by the assessee, such donation of Rs. 17,96,000/- was specifically treated as corpus donation and not as voluntary donation. Accordingly, in our considered view, treatment of corpus donation as voluntary donation falls outside the scope of adjustments contemplated under Section 143(1) of the Act. Secondly, we observe that in the case of Shree Swaminarayan Charitable Trust (supra), whe....
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....Revenue authorities, and allow the grounds of appeal." 11. The ITAT Ahmedabad in this case has held that delay in submission of Form No. 10B is a procedural defect and once the said Form has been filed during the course of hearing, no disallowance is called for on account of late / delayed filing of Form No. 10B. In the instant case, we observe that the assessee had filed Form No. 10B before Ld. JCIT(A) before conclusion of appellate proceedings. Accordingly, in view of the aforesaid decision of Ahmedabad Tribunal, exemption under Sections 11&12 of the Act cannot be denied to the assessee only on account of late filing of Form No. 10B. Accordingly, in light of the above observations, the appeal of the assessee is allowed. 12. In the result, the appeal of the assessee is allowed. 8. In the case of Shree Bhakt Samaj Vikas Education Trust vs. Assistant Commissioner of Income-tax (Exemption) [2025] 175 taxmann.com 1076 (Ahmedabad Trib.) [2025] 213 ITD 639 (Ahmedabad-Trib.) [25.06.2025], wherein it was held at paragraph Nos.9, 11 & 12 of the order as under:- ........................... "9. We observe that admittedly there was a delay on filing Form....
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....mption should not be denied merely on account of delay in furnishing the same and it is permissible for the assessee to produce the audit report at a later stage either before the Income-tax Officer or before the appellate authority by assigning sufficient cause. 33. In view of the above, this writ-application succeeds and is hereby allowed. The impugned order passed by the respondent no. 2 dated 19th August 2019 (Annexure-A to this writ-application) is hereby quashed and set aside. The impugned rectification order at page-13 of the paper-book dated 12th February 2020 is also hereby quashed and set aside. The delay condonation application filed by the writ applicant before the respondent no. 2 is hereby allowed." ............................ 11. Accordingly, in view of the decision of the Hon'ble Gujarat High Court in this issue, as well as various other judicial precedents which have upheld the principle that delay in filing of Form 10B being a procedural default should not disentitle the assessee / applicant trust the denial of grant of exemption under Section 11 of the Act, we are of the considered view that in the assessee's set of facts, clai....