INCOME TAX OFFICER(EXMP)-2(4), MUMBAI , MUMBAI vs. VISHNU JANARDAN SHIROLKAR MAHAJAN WADY TRUST, MUMBAI

And held as under:-\n“3. The issue in narrow compass and is about the Commissioner of Income-tax\n(Appeals) directing acceptance of audit report from the assessee and granting\nexemption under section 11 of the Income-tax Act, 1961 (hereinafter referred to as\n`the Act' for sake of brevity).\n3.1 The assessee filed its return of income for the Assessment Year 2006-07. On\nverification, the Assessing Officer noticed that the assessee had not furnished audit\nreport in Form No.10B, which was compulsory requirement for eligibility of\nexemption under section 11A of the Act as stated in section 12A(b) read with Rule\n17B of the Income Tax Rules, 1962. Assessee was issued show cause notice as to why\nexemption claimed by it under section 11 should be disallowed. The Assessing Officer\npassed order denying the exemption. He taxed gross receipts without granting\ndeduction of expenditure.\n3.2 In the appeal preferred by the assessee, the Commissioner of Income-tax (Appeals)\npermitted the assessee to file the audit report and directed to accept the same by his\norder dated 16.04.2009 and the exemption under section 11 of the Act allowed. The\nDepartment filed appeal which came to be dismissed by the impugned order bringing\nthe Department before this Court by way of present appeal.\n4. The question whether it is permissible to the assessee to produce the audit report\nat the appellate stage, has already been answered by this court in CIT v. Gujarat Oil\n& Allied Industries Ltd. [1993] 201 ITR 325 (Guj.), wherein it is held that the\nprovision regarding furnishing of audit report along with the return has to be treated\nas a procedural provision. It is directory in nature and its substantial compliance\nwould suffice. In that case, the assessee had not produced the audit report along with\nthe return of income, but produced before completion of the assessment. The Punjab\nand Haryana High Court in CIT v. Shahzadanand Charity Trust [1997] 228 ITR\n292/[1998] 96 Taxman 494 has reiterated the same principle holding that the benefit\nof exemption should not be denied merely on account of delay in furnishing the same,\nand it is permissible for the assessee to produce the audit report at a later stage either\nbefore the Income Tax Officer or before the appellate authority by showing a sufficient\ncause. This decision of Punjab & Haryana High Court has been relied on by the\nTribunal.\n5. In the above view, the Tribunal is eminently justified both in law and on facts in\nobserving and holding as under:-\n\"In this case, it is not in dispute that the audit report in prescribed form was obtained\nprior to filing of the return on 20/12/2006; therefore, there was no reason for the\nassessee to keep the audit report with it in order to loose the exemption. The assessee\nin the earlier as well as in the subsequent assessment years filed the audit report and\ngot the exemption. The conduct of the assessee in earlier year and subsequent years\nwould prove that due to the facts stated above there was delay in filing the audit\nreport and the contention of the assessee was supported by the affidavit of Mohmad\nIqbal Vohra (PB-4). The learned CIT(A) on proper appreciation of the facts and\nmaterial on record in the light of the decisions of the Hon'ble Punjab & Haryana\nHigh Court and the Hon'ble Calcutta High Court rightly directed the AO to accept\nthe audit report of the assessee and grant exemption u/s.11 of the IT Act.\"\n6. For the above reasons, the appeal of the Revenue is devoid of merit, raising no\nquestion of law much less any substantial question of law.\"\n5. Similar view was taken by the Co-ordinate Bench in the case of\nChurch of Our Lady of Immaculate Conception in &\n4998/Mum/2025. The relevant findings of the Co-ordinate Bench read as\nunder:-\n“We have considered the rival submissions of both the parties and have gone through\nthe orders of lower authorities carefully. We have also deliberated on various case\nlaws relied by the Id. AR of the assessee. We find that there is very short dispute in\nthe present appeal. Admittedly, there is delay of 29 days in filing Form 10B. Though,\nthe same was filed along with the return of income. Return of income was filed within\nextended period allowed by CBDT. We find that in a series of decision, as relied by\nId AR of assessee, various High Courts as well as Tribunals have taken view that\nwhen audit report / Form 10B was filed even at later stage and the same was available\nbefore assessing officer when return was processed, the assessee is entitled to\nexemption. Moreover, in the present case now, Hon'ble Jurisdiction High Court has\nalready allowed delay in filing Form 10B. Thus, considering the facts of the case and\nkeeping in view, various decision of High Courts and co-ordinate bench of Tribunal\ndelay in filing form 10B in AY 2023-24 is also allowed and jurisdictional assessing\nofficer (JAO) is directed to verify the fact and allow appropriate relief for application\nof income under section 11. The assessee is also directed to provide requisite details,\nif so desired by jurisdiction assessing officer. In the result, grounds of appeal raised\nby assessee are allowed.”\n6. Respectfully following the decision of the Hon'ble High Court, we\ndecline to interfere with the findings of the ld. CIT(A). The appeal filed\nby the Revenue is accordingly dismissed. Since the appeal of the\nrevenue is dismissed, the cross-objection of the assessee becomes\ninfructuous.\n7. In the result, the appeal of the revenue and the cross-objection\nfiled by the assesse are dismissed.\nOrder pronounced in the Court on 16th October, 2025 at Mumbai.\nSd/-\n(SAKTIJIT DEY)\nVICE PRESIDENT\nMumbai, Dated 16/10/2025\n*SC SMPS\nSd/-\n(NARENDRA KUMAR BILLAIYA)\nACCOUNTANT MEMBER\nआदेश की प्रतिलिपि अग्रेषित/