2026 (4) TMI 1018

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....e preferred three Appeals before the Ld. CIT(A). The Ld. CIT(A) vide orders impugned dated 08/09/2025, dismissed the Appeals of the Assessee. As against the orders of the Ld. CIT(A), Assessee preferred the captioned Appeals. 3. The Ld. Counsel for the Assessee submitted that the Assessee has secured the Audit Report before filing the return, due to unintentional reasons, the same could not be filed on time, however, the same has been filed with a delay which is inadvertent. The Ld. Counsel has produced following date chart to substantiate its claim. Summary of Filing 10B (Audit Report) and ITR     A.Y 10B (Due date) 10B (Filing Date) No. of Days delay ITR (Due date) ITR (Filing Date) (No.of days delay 2020-21 15/01/2021 31/03/2021 75 days 15/02/2021 31/03/2021 44 days 2021-22 15/02/2022 15/03/2022 28 day 15/03/2022 15/03/2022 No delay 2022-23 07/10/2022 14/10/2022 7 days 07/11/2022 02/11/2022 No delay Further, the Ld. AR relying on the plethora of Judgments sought for allowing the Appeals. 4. Per contra, the Ld. Departmental Representative filed written submission as unde....

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....ation. (2) When there is ambiguity in exemption notification which is subject to strict interpretation, the benefit of such ambiguity cannot be claimed by the subject/assessees and it must be interpreted in favour of the revenue. Further, the Hon'ble Apex court in the case of Principal Commissioner of Income Tax-III, Bangalore and another Vs. M/s Wipro Limited (Judgment dated 11.07.2022 in the Civil Appeal No. 1449 OF 2022) has applied strict construction to reverse the findings of the Hon'ble High Court (HC) of Kamataka which had earlier allowed carry forward of such losses. The Hon'ble SC held that the requirement of filing a declaration within a timeline is "mandatory" in nature as per the language of the provision. It reiterated the age-old principle that a taxing statute should be read as it is and held that the exemption/ deduction provisions should be "strictly" and "literally complied with and, therefore, a strict interpretation should be adopted. The Supreme Court has stated as under "In view of the above discussion and for the reasons stated above, we are of the opinion that the High Court has committed a grave error in observing and holding ....

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....e Act is not mandatory requirement but only directory in nature. The Co-ordinate Bench of the Tribunal of the Pune Bench while dealing with the identical issue in ITA No. 928/PUN/2025 (ITO Vs. the New Miraj Education Society vide order dated 01/01/2026, held as under:- "8. We have also perused the decision of Coordinate Bench of Pune Tribunal in the case The Nanded Sikhgurudwara Sachkhand Hazur Sahib (supra) (to which both the Members are parties) and find that the Tribunal under similar set of facts has dismissed the appeal of the Revenue and allowed the claim of exemption u/s. 11 of the Act to the assessee. The relevant observations and findings of the Tribunal, in the above referred case, are as under:- "20. So far as the grievance of the Revenue that the Ld. CIT(A) / NFAC has erred in allowing the appeal of the assessee by holding that filing of audit report in the prescribed form before completion of the assessment proceedings is sufficient compliance under the provisions of the Act is concerned, we find the Ld. CIT(A) / NFAC while deciding the issue has followed the decision of the Coordinate Bench of the Tribunal in assessee's own case for assessment year 2....

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.... otherwise the provision of this Section shall not apply to him for any of the relevant assessment year. 6. Considering the language of the provision of Section 10B(8) of the Act, the Hon'ble Supreme Court held that it was mandatory on part of the assessee to file declaration before the due date of filing of return under Sub-section (1) of Section 139 of the Act, whereas, in the facts of the said case the assessee filed such undertaking along with the revised return under Sub-section (5) of Section 139 of the Act and in such facts, the Hon'ble Supreme Court held that the twin conditions prescribed under Section 10B(8) of the Act was mandatory to be fulfilled and it cannot be said that though the declaration is mandatory, the filing of such declaration within the due date of filing of return under Sub-section (1) of Section 139 of the Act would be directory. 7. Reference to the aforesaid decision has no connection whatsoever remotely to the facts of the present case and therefore, in the facts of the present case, the Tribunal has rightly followed the decision of this Court in case of Sarvodaya Charitable Trust v. Income Tax Officer (Exemption) in Special C....