TaxTMI 
TaxTMI 
2026 (4) TMI 1535
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..... 11 of the Act. 3. Assessee filed audit report in form number 10BB instead of form number 10B on 08.02.2022. The due date for filing of the audit report was 15.02.2022. 4. Due to a bona fide oversight as stated, the Chartered Accountant of the Appellant inadvertently filed audit report in form number 10BB on 08.02.2022 instead of form number 10B. When the Chartered Accountant came to be aware of these facts the audit report was filed in correct form 10B on 04.11.2022. It has caused a delay of 262 days in filing form number 10B. 5. The above return was processed u/s. 143[1] of the Act on 25.11.2022, and the total income of the Appellant was determined at Rs. 51,92,257/- denying exemption u/s 11 & 12 of the Act on account of delayed filing of form number 10B. 6. Aggrieved with the intimation, Assessee filed request for rectification of the same that exemption claimed u/s. 11 of the Act should be allowed. However, such an application was rejected on 08.12.2022. Against this order it preferred an Appeal before the Commissioner of Income Tax [A] which was disposed of on 23.08.2025 where in it was held that as form number 10B is filed belatedly, the delay is procedural and c....
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....1.2022 well before the impugned intimation issued u/s. 143 [1] of the Act on 25.11.2022 and therefore the Central Processing Centre had all the necessary information in form number 10B for allowing the exemption claimed u/s. 11 of the Act before issuance of impugned intimation. She further submitted that a bona fide delay in filing form number 10B would not defeat the Appellant's substantive right of claiming exemption. It was also her claim that filing of form number 10B is procedural in nature and delayed filing of form number 10B would not result in denial of exemption u/s. 11 of the Act. She referred to the rationale behind the above contention that the Appellant being a charitable trust would not be disentitled for claiming exemption u/s. 11 of the Act merely on account of delayed filing of form number 10B. It was further submitted that filing of form is construed as a directory requirement which must be substantially complied with and in the present case of the Appellant the said requirement has been sufficiently complied with. She further referred to several judicial precedents of coordinate benches wherein on identical facts and circumstances the claim of the Assessee for e....
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.... condone the delay according to the provisions of the Act and relevant circular cited by him. He therefore submitted that there is no grievance caused by the order of the Commissioner of Income Tax Appeals and therefore the Appeal of the Assessee cannot be entertained. 11. We have carefully considered the contentions of the parties and considered the orders of the Ld. lower authorities. According to the provisions of section 12A of the Act, there are conditions for applicability of section 11 and 12 are specified categorically provides that the provisions of section 11 and section 12 shall not apply in a relation to the income of any trust unless certain conditions are fulfilled. According to subsection [b] the condition is prescribed that the Assessee, if the income exceeds the maximum amount which is not chargeable to income tax, the books of accounts of the trust are required to be audited before the specified date referred to in section 44AB and such report should be furnished in the prescribed form [10B] duly signed and verified. Thus, the timelines are mentioned in the Income Tax Act itself of filing such audit report. Further this is also stated to be a necessary conditio....
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....tion for claiming exemption u/s. 11 was satisfied. Although the requirement of furnishing audit report was mandatory, filing thereof is a procedural aspect. Even though Form No. 10B was filed at a later stage, when it was part of the record of the Assessing Officer in course of the processing of the return of income, the Assessing Officer could not have denied the exemption claimed by the Assessee u/s. 11(1) & (2) on the ground that the audit report was not filed. It further held that the import of section 119(2)(b) because the application contemplated thereunder is only additional remedy for the Assessee which could not be said to be compulsorily restored to by the Assessee. Circular No. 7/18, dated 20.12.2018 issued u/s. 119 could not, therefore, be said to have taken away the appellate remedy. It further held that the moot aspect thus centers around the requirement of the availability of the audit report when the Assessment was undertaken by the Ld. Assessing Officer even though the same may not have been filed along with the return of income. Filing of audit report is held to be substantive requirement but not the mode and stage of filing, which is procedural. Once the audit re....