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Income Tax Appellate Tribunal, “DB” BENCH, JABALPUR
O R D E R
PER PAVAN KUMAR GADALE JM:
The assessee has filed the appeal against the order of the National Faceless Appeal Centre (NFAC) /CIT(A) passed u/sec 154 and 250 of the Act. The assessee has raised the following grounds of appeal:
1. That the commissioner Appeals faceless erred in not condoning the delay in filling 10B audit report up loaded belatedly by C.A. on 26.02.2020, whereas it was signed by C.A. on 20.06.2018 and the assesse dully added C. A for up loading
Sri Namiyun Paraswanath Jain Swetamber Manidhari Trust. Jabalpur . - 2 - on 03.08.2018, ITR was filed on 06.08.2018, thus the audit report was already available at the time of filling the return.
2) That in view of the recent judgment of Savitri Foundation VS ITO (ITA No 1925/Mum/2021 A.Y 2018-19) order dated 1.08.2022 it was held that the audit report when it was available at the time of filling the ITR, field at the time of filling appeal due to bona fide reasons, the benefit of section 11 can not be denied, being merely procedural defect which is rectifiable. Also relied on M.P. High Court (1998)230 ITR 0714- filling of audit report being directory and can be filed up to assessment stage.
3) That the commissioner appeals faceless erred in confirming order of CIT(exemption) u/s 119(2) dated 11.09.2020 denying condonation of delay being more than 365 days as against the due date of 31.10.2018, whereas it was claimed that delay be computed u/s 139 as per CBDT circular 02/2020 dt 3.1.2020 w.e.f due date being 31 March of every asstt. year, I e. For the A.Y. 2018-19- 31.03.2019 and thus 10B form filed On 26.02.2020, the delay is within 365 days should have been condoned relying on the CBDT circular No. 6/2020 dt 19.02.2020 4) That the Comm. (appeals) erred in not adjudicating the ground of corpus donation Rs. 15,02,000,the only income of the trust claimed exempt even if benefit of section 11 not given and can not be disallowed u/s 143(1) being disputable by the CPC as not being prima facie disallowable and treating the same as gross income for levying the tax Rs. 349690/-.Relied on Serum Institute case (2018) TTJ 0820 (Rune Trib) and Shri Guru Singh Sabha (2018) 068 ITR (Trib) 0394 Delhi ITAT.
5) That the appellant reserves the right to add modify alter the grounds of appeal.
Sri Namiyun Paraswanath Jain Swetamber Manidhari Trust. Jabalpur . - 3 -
The brief facts of the case are that the assessee is a trust registered u/s 12AA/12A of the Act.The assessee has filed the return of income electronically for the A.Y 2018-19 on 06.08.2018 and subsequently revised return of income was filed on 30.03.2019.Whereas the Audit report in Form No.10B was filed/uploaded on 26.02.2020 and the return of income was processed u/s 143(1) of the Act on 18-03-2020 denying the benefit u/s 11 of the Act as the form No.10B was not uploaded along with the return of income and the claim of corpus donation of Rs,15,02,000/- was added and determined the total income of Rs.15,02,000/-. Whereas the assessee has filed application for condonation of delay in filling Form.No.10B and same was rejected by the CIT(E) vide order U/sec119(2)(b) of the Act dated 11-09-2020, Further the assessee has filed the rectification petition U/sec154 of the Act and was rejected vide order dated 23- 07-2021.
Aggrieved by the rectification order u/s 154 of the Act, the Assessee has filed an appeal before the CIT(A).Whereas the CIT(A) has considered the grounds of appeal, findings of the AO and submissions of the assessee but has rejected the request for condonation of delay in filling the Sri Namiyun Paraswanath Jain Swetamber Manidhari Trust. Jabalpur . - 4 - Form.No.10B and dismissed the assessee appeal. Aggrieved by the order of the CIT(A), the assessee has filed an appeal before the Honble Tribunal.
4. At the time of hearing, the Ld.AR submitted that the CIT(A) has erred in not considering the facts that the Audit Report in form No.10B was signed by the Chartered Accountant on 20.06.2018 and the Auditor/CA was added in the e-filling portal for uploading form No.10B on 03.08.2018 and the assessee has filed the return of income on 06.08.2018 and also filed the revised return of income on 30-03-2018. Further the audit report in Form. No.10B was uploaded by the C.A. on 26.02.2020 and the assessee was dependent on the CA and there is a delay in filling/uploading the Audit report and thus caused hardship beyond the control of the assesse and the reasons are genuine and it is a curable defect. The Ld.AR substantiated the submissions with the CBDT Circular and judicial decisions and prayed for allowing the appeal. Contra, the Ld. DR relied on the order of the CIT(A).
5. We heard the rival submissions and perused the material on record. The sole matrix of the disputed issue envisaged by the Ld.AR that the CIT(A) has erred in not considering
Sri Namiyun Paraswanath Jain Swetamber Manidhari Trust. Jabalpur . - 5 - the facts of hardship and the reasonable cause for delay in uploading the Audit Report in Form.No.10B. Further the Ld. AR explained that the delay is not an wanton act and the assessee has obtained audit report prior to filing of the return of income but was uploaded belatedly. Whereas the Audit Report in form No.10B was signed by the Chartered Accountant on 20.06.2018 and the CA was added in the e-filling portal for uploading form No.10B on 03.08.2018 and the assessee has filed the return of income on 06.08.2018 and also filed the revised return of income on 30-03-2018. Further the audit report in Form.No.10B was uploaded by the C.A. on 26.02.2020 and the assessee was dependent on the CA and there is a delay in filling/uploading the Audit report and thus caused hardship beyond the control of the assesse and reasons are genuine and it is a curable defect. We find the Hon'ble Tribunal on the similar issue where there was delay in filling the Form.No.10B and it treated as procedural defect and is curable and was restored to the lower authorities in the case of Savitri Foundation Vs.ITO, A.Y 2018-19 has observed at Para 4 to 7 of the order read as under:
Sri Namiyun Paraswanath Jain Swetamber Manidhari Trust. Jabalpur . - 6 - “4. Submissions made by rival sides heard, orders of authorities below examined and the case law on which the Id.Authorized Representative of the assessee placed reliance considered. The assessee is a charitable trust registered under section 12AA of the Act and has been purportedly enjoying the benefits of section 11 since 2011. In the impugned assessment year the benefit of exemption under section 11 of the Act has been denied to the assessee for the reason that assessee has failed to furnish audit report along with return of income. The contention of the Id. Authorized Representative of the assessee is that the audit report was available with the assessee at the time of filing of return of income however due to inadvertent error the assessee failed to upload Audit Report in Form 10B along with e-filing of return of income. Non-filing of Audit Report is a bonafide error. The assessee has placed on record Audit Report dated 19/10/2018 in the prescribed Form 10B at page 15 of the Paper Book. The assessee after receiving the intimation under section 143(1) of the Act uploaded the Audit Report on 18/04/2020 in FirstAppellate proceedings.
In my considered view non-filing of Audit Report in Form 10B along with Return of Income is merely a procedural defect which is rectifiable. If the Audit Report was available with the assessee at the time of filing of Return of Income and was not filed due to bonafide reasons the benefit of exemption under section 11 cannot be denied if otherwise assessee is eligible to claim the same.
The Hon'ble Bombay High Court in the case of CIT vs. Mumbai Metropolitan Regional Iron & Steel Market Committee(supra) has held that late filing of required documents would not disentitle the assessee from availing benefit of section 11 of the Act. Thus, in the facts of the case and in the light of decisionHon'ble Bombay High Court, I deem it appropriate to restore the file back
Sri Namiyun Paraswanath Jain Swetamber Manidhari Trust. Jabalpur . - 7 - to Assessing Officer for denovo assessment after considering the audit report field by the assessee, in accordance with law.
7. In the result, impugned order is set aside and appeal by assessee is allowed for statistical purposes”
6. We find the facts of the present case are similar and identical. Hence considering the submissions, findings of the authorities, judicial precedence and the ratio of the judicial decision discussed above and on the similar directions the disputed issue is restored to the file of the Assessing Officer to adjudicate afresh after considering the Audit report and the assessee should be provided adequate opportunity of hearing and shall cooperate in submitting the information for early disposal of the appeal. Accordingly, we allow the grounds of appeal of the assessee for statistical purposes.
In the result, the appeal filed by the assessee is allowed for statistical purposes.