TaxTMI 
TaxTMI 
2025 (10) TMI 1430
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.... 2022-2023 whereby the assessee has raised the following grounds : 1. "The order passed by the Ld. CIT(A) u/s 250 of the Act dated 08:03.2024 is erroneous both on facts and in law to the extent the order is prejudicial to the interest of the appellant. 2. The Ld. CIT(A) ought to have appreciated that, the delay in filing of Form 10B was due to ill medical health of the accountant. This constitutes a reasonable cause under Section 119(2)(b) of the Income Tax Act, 1961. 3. The Ld. CIT(A) erred in not giving a reasonable opportunity of being heard to the appellant and passing the order u/s 250 of the Act. 4. The Ld. CIT(A) erred in confirming the disallowance of entire expenditure claimed by the assessee amounting to Rs.8,76,751/, which is exempt as per the provisions of Sec 11 of the IT Act, 1961. 5. The Ld. CIT(A) erred in not appreciating that the entire amount of Rs.8,76,751/-has been duly expended towards the objects of the trust on Revenue account and Capital account which is clearly evident from the Return of Income filed. 6. The Ld. CIT(A) ought to have appreciated that the assessee has duly complied with the provisions of ....
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....n nature and, therefore, it was not justified to withdraw the substantial benefit due to delay in filing Form-10B. In support of this contention, he has relied upon the following decisions : 1. Order of ITAT Ahemdabad in the case of ITO (Exemptions) vs., Ramji Mandir Religious and Charitable Trust [2004] 158 taxmann.com 114 2. Order of ITAT Hyderabad in the case of Darga Ehazrat Syedshah Khwajadas Chisti Unnayabi Perpetual Trust, Vatpalli vs., ITO (Exemptions), Ward-1(3), Hyderabad in ITA No.567/Hyd/2024, Dated 29.08.2024. 3. Judgment of Hon'ble High Court of Bombay in the case of St. Thomas High School vs., CIT (Exemptions) [2025] 178 taxmann.com 408 (Bom.) 4. Order of ITAT Ahemdabad in the case of ITO (Exemptions) vs., Takshshila Foundation (NGO) [2024] 165 taxman.com 735 (Ahmedabad - Trib.). 5. Order of ITAT Hyderabad in the case of Touchlife Foundation India, Hyderabad vs., ITO (Exemptions), Ward-1(3), Hyderabad in ITA No. 617/Hyd/2024, Dated 25.07.2024. 6. Bhagwant Kishore Memorial Education society vs., ITO (2024) 166 taxmann.com 511 (Delhi - Trib.) 7. Judgment of Gujarat High Court in the case of Association of Indian Panelboard Manu....
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....d in paras 4.1 to 6.1 as under : 4.1. In support of the above submissions, reliance was placed on the decisions of this court in CIT v. Mayur Foundation (20051.274 ITR 562 (Guj.) in CIT v. Xavier Kelavani Mandal (P.). Ltd. (2014) 41. taxmann.com 1841/221 Taxman 43 (Mag). (Guj.) in CIT v. Andhra Pradesh State Road Transport Corporation 120061.285 ITR 147(AP) and CIT v. Rai Bahadur Bissesswarlal Motilal Malwasie Trust [1992] 65 Taxman 273/195 ITR 825 (Cal). 5. The decision of the Division Bench of this court in Xavier Kelavani Mandal (P.) Ltd. (supro) leaves the issue no longer res integra. In that case Form 10B was not filed by the assessee alongwith the return of income, however the appellate authority permitted the assessee to file Form 10B audit report at the appellate stage and accepted the same to allow the exemption under section 11. The department filed appeal which came to be dismissed. 5.1. The Division Bench of this court dismissed the appeal before it confirming the view taken observing that the provisions regarding filing of audit report was procedural in nature, "4. The question whether it is permissible to the assessee to produce the....
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....he return of income, the same was available with the Assessing Officer when he processed the return of income under section 143(1) of the Act. The conditions for claiming exemption under section 11 was satisfied. Although the requirement of furnishing report was mandatory, filing thereof is a procedural aspect. Even though the Form 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 under sections 11(1) and 11(2) on the ground that the audit report was not filed. 5.6. The tribunal further committed an error in appreciating the import of section 119 2(b) of the Act inasmuch as the application contemplated thereunder is only additional remedy for the assessee which could not be said to be compulsorily resorted to by the assessee. The circular No.7/18 dated 20-12-2018 issued under section 119 of the Act could not be, therefore said to have taken away the appellate remedy. 5.7. The tribunal misdirected itself in yet another way when it observed that The Finance Act, 2015 with effect from 1-42016, tha....
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....Trust (supra), has held in Paras-8 to 10 as under : "8. We have heard the rival contentions and perused the material on record. We observe that in the instant facts, it is not a case where the assessee had not filed Form 10 in the original return of income, before the due date prescribed of filing return of income. It is only a case where the assessee observed that a certain error had crept in the original return of income, wherein the quantum of deduction claimed under section 11(2) of the Act required correction and accordingly, the assessee filed revised return of income with the higher claim of deduction under section 11(2) of the Act. It has been held by various Courts that the requirement of filing Form 10/10B is merely directory in nature and failure to furnish Form 10/10B before due-date prescribed u/s 139(1) of the Act cannot be so fatal so as to deny they very claim of exemption u/s 11(2) of the Act especially when Form 10/10B was available on record when the intimation was passed by CPC u/s 143(1) of the Act. The following judicial precedents have reiterated the aforesaid principal: I. Association of Indian Panelboard Manufacturer v. Dy. CIT [20231 157 ....
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....be uniformly applied to all cases and the aforesaid decision was distinguished by the Ahmedabad Tribunal, with the following observations: 6.3. Another notable issue for consideration is that recently the Hon'ble Supreme Court was confronted with the claim of benefit a/s 108 in Pr. CIT v. Wipro Ltd. [20221 140 taxmann.com 223/288 Tasman 491/446 ITR 1. The assessee furnished original return taking the benefit of section 108 and did not carry forward the loss. Thereafter, a revised return was filed foregoing the claim of deduction u/s 10B. The AO rejected the withdrawal of exemption under section 10B by holding that assessee did not furnish the necessary declaration in writing before due date of filing return of income, which was an essential requirement for not claiming the benefit of section 10B. The Hon'ble High Court decided the issue in favour of the assessee by holding that the requirement of filing the declaration was mandatory but filing it along with the return of income u/s 139(1) was a directory requirement. The matter was brought by the Revenue before the Hon'ble Supreme Court. The assessee, inter alia, relied on the judgment of the Apex Court in G.M.....
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....nd only Form 56F was omitted to be e-filed along with return of income), whereas the issue for consideration in Wipro case supra was that once the assessee had claimed benefit of section 10B in the original return of income, whether such benefit could be foregone/withdrawn by filing declaration a/s. 10B(8) of the Act in the revised return of income filed u/s 139(5) of the Act (and the assessee could, in turn, avail the benefit of carry forward losses in the revised return of income). (ii) Secondly, the Hon'ble Supreme Court in the case of Wipro Limited held that section 10B of the Act is an "exemption provision" and hence, assessee claiming such exemption has to be "strictly" comply with the exemption provisions. However, notably, the Hon'ble Supreme Court in the case of CIT v. Yokogawa India Ltd 391 ITR 274 (Supreme Court), held that section 10A of the Act is a "deduction provision" and not an "exemption provision". Therefore, apparently there seems to be a difference of opinion to whether section 10A/B provisions qualify as "Exemption" or Deduction" provisions. Therefore, since it is well-settled principle of law that deduction provisions, which have been introdu....
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....deduction u/s. 10AA of the Act, the assessee claimed deduction u/s. 10B of the Act in the income tax return. The A.O. rejected the claim on the ground that assessee did not file form 56F along with return of income and had filed form 56G instead. The Id. A.R argued that the AO ought to have allowed the deduction u/s. 10AA since the assessee had filed form 56F during assessment proceeding which was a pure technical mistake. The Tribunal held that benefit of deduction should not be disallowed as the assessee had duly fulfilled the conditions for claiming exemption u/s. 10AA of the Act. In the case of ITO v. Accentia Technologies 52 taxmann.com 89 (Mom). the Mumbai Tribunal held that deduction under section 10A cannot be denied merely because at time of filing of return, claim had mistakenly been made under section 10B of the Act. The Gujarat High Court in the case of Zenith Processing Mills CIT 219 ITR 721(Guj) held that provision of section BOJ(6A) to extent it requires furnishing of auditor's report in prescribed form along with return, is directory in nature and not mandatory. Further, assessee can be permitted to produce such report at later stage when question of disallowanc....
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....eme Court. Respectfully following the same we hold that since the Form 10 was available when the CPC passed the intimation in this case, disallowance of the claim of the assessee under section 11(2) of the Act is not proper. 7. Admittedly in this matter, the return of income was filed on 22/3/2021, Form 108 was filed on 20/3/2021 and the intimation under section 143(1) of the Act was passed on 30/11/2021, indicating that as on the date of passing of the 143(1) of the Act intimation Form 108 was very much available on record. We, therefore, respectfully following the view taken by the coordinate Bench in the case of Ramji mandir Religious and Charitable Trust (supra), we deem it just and proper to direct the learned Assessing Officer to consider Form 108 available on record at the time of processing the return of income. Learned Assessing Officer is, therefore, is directed to consider Form 10B available on record and to pass appropriate orders." 8. Accordingly, in view of the facts and circumstances of the case when the Form-10B was filed along with the return of income and within the due date of filing the return of income u/sec.139(1) of the Income Tax Act, 1961, then,....