ARUNACHALA CHARITABLE TRUST,NAMAKKAL vs. ITO, EXEMPTIONS WARD, SALEM, SALEM

आदेश/O R D E R

PER S.S. VISWANETHRA RAVI, JUDICIAL MEMBER: Both the appeals filed by the assessee are directed against the separate orders both dated 31.12.2025 by the ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre [NFAC], Delhi for Assessment Year 2021-22 & 2022-23 respectively.

2 I.T.A. I.T.A. No.798 I.T.A. I.T.A. No.798 No.798 & 799/Chny/2026 No.798 799/Chny/2026 799/Chny/2026 799/Chny/2026

same identical facts with regards to sole assessee, therefore, upon

hearing both the parties and with their consent we proceed to hear both

the appeals together and pass a common order for the sake of

convenience.

petition for admission of additional grounds and prayed to take up the

same as primary issue. The ld.AR submits that the ld.CIT(A) dismissed

the appeal of the assessee in limine u/s. 11 of the Income-tax Act, 1961

[‘the Act’ in short] by rejecting the delay condonation petition which was

filed to condone the delay of 911 days for the assessment year 2021-22.

She submits that the claim u/s. 11 of the Act was disallowed by the CPC,

Bengaluru, for non-filing of return of income within the due date specified

under the Act. She further submits that the assessee immediately filed an

application before the ld.CIT(E) to condone the delay in filing the return of

income to claim exemption u/s. 11 of the Act. The assessee was awaiting

the results of the same, due to which no appeals were filed before the

ld.CIT(A). She submits that the tax practitioner advised the assessee to

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file appeal before the ld.CIT(A) atleast, challenging the disallowance by

denying claim u/s. 11 of the Act. She prayed to admit the additional

grounds for assessment year 2021-22 and direct the ld.CIT(A) to condone

the delay and to tax the net income instead of gross receipt for the

assessment year 2021-22.

objection in taxing the net income instead of gross receipts. Having

heard both the parties, we note that the assessee explained reasons for

the delay of 911 days for the assessment year 2021-22, which were

reproduced by the ld.CIT(A) in the impugned order. On perusal of the

same, it was stated that the assessee filed a petition before the ld.CIT(E),

Chennai for condonation of delay in filing the return of income to claim

exemption u/s. 11 of the Act. The assessee was awaiting for the disposal

of the said application, thereby no appeal filed before the ld.CIT(A)

challenging the disallowance made by the CPC, Bengaluru, in denying

the claim u/s. 11 of the Act for non-filing of return of income within the

time provided by the statute. Further reading of the same, it is noted that

the assessee filed an appeal immediately before the ld.CIT(A) on getting

the advice from the tax professional atleast to make alternative claim to

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tax the net income instead of gross receipt. It is a settled principle that

the gross receipt cannot be taxed, wherein, the net income has to be

taxed by giving benefit to the expenditure. In this case, we find no benefit

was given to expenditure which is provided under the law. Thereby, we

accept the submission of the ld.AR in considering the alternative plea to

tax net income but not gross receipt and we allow additional ground nos.

1 to 3. Thus, the ld.CIT(A) is directed to condone the delay and decide

the issue in alternate plea in taxing the net income by giving benefit of

expenditure. In view of our decision in additional ground nos. 1 to 3,

remaining grounds raised in Form 3 becomes academic requiring no

adjudication.

798/Chny/2026 is allowed for statistical purposes.

Bengaluru, denied the claim u/s. 11 of the Act for not uploading audit

report in Form 10B, one month prior to filing of return of income u/s. 139(1)

of the Act. On perusal of the impugned order at Para no. 5.4, the

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ld.CIT(A) held the delay of 417 days is a huge delay and reasons offered

by the assessee are inadequate, thereby, rejected the delay condonation

petition, reasons of which are reproduced in Para 5.2 of the impugned

order. The ld.AR submits that the issue is covered in favour of the

assessee, since the ld.CIT(A) not condoned, the issue on merits not

adjudicated. He prayed to remand the matter the file of the ld.CIT(A) for a

fresh consideration of delay condonation petition.

the matter to the file of the ld.CIT(A), that should be on a condition of

payment of cost.

year 2021-22, we remanded the matter to the file of the ld.CIT(A) for a

fresh consideration to tax only the net income but not gross receipt by

giving our reasons in the aforementioned paragraphs. Since this appeal

also connected with the same, having considering the submissions of the

ld.AR that he has a fair case to succeed before the ld.CIT(A), thereby, we

direct the ld.CIT(A) to consider delay condonation and condone the delay

of 417 days on payment of cost of Rs.40,000/- in favour of Tamilnadu

6 I.T.A. I.T.A. No.798 I.T.A. I.T.A. No.798 No.798 & 799/Chny/2026 No.798 799/Chny/2026 799/Chny/2026 799/Chny/2026

State Legal Services Authorities at Hon’ble High Court of Madras within

30 days from the date of receipt of this order. The ld.CIT(A) shall satisfy

the payment of cost and proceed to adjudicate the issue on merits. The

assessee is liberty to provide evidences, if any, in support of his claim.

Thus, grounds raised by the assessee are allowed for statistical purposes.

purposes.

799/Chny/2026 are allowed for statistical purposes. Order pronounced on 30th April, 2026 at Chennai.

Sd/- Sd/- (S.R. RAGHUNATHA) (S.S. VISWANETHRA RAVI) ACCOUNTANT MEMBER JUDICIAL MEMBER Chennai, Dated : 30.04.2026 JPV/- आदेशकी'ितिलिपअ.ेिषत/Copy to: 1. अपीलाथ&/Appellant, 2.'(थ&/ Respondent, 3. आयकरआयु//CIT, Chennai/Madurai/Coimbatore/Salem 4. िवभागीय'ितिनिध/DR & 5. गाड$ फाईल/GF.

PRASANNA Digitally signed by PRASANNA VANI JETTY VANI JETTY Date: 2026.05.04 10:45:04 +05'30'