UNITED JAIN STUDENTS HOME,MUMBAI vs. EXEM WARD 2(4) MUMBAI, MUMBAI

Per: SHRI JAGADISH, A.M.:

This appeal by the assessee is directed against the order dated 20.08.2025 passed by the Ld. CIT(A) for A.Y. 2017-18.

ITA Nos.6625/M/2025 United Jain Students Home year 1917 and is registered under the Bombay Public Trust Act, 1950. It was granted registration under section 12A of the Act on 12.06.1957. The assessee is engaged in charitable activities of providing hostel facilities to students and operates boys' hostels at two locations in Mumbai.

3.1 The return of income was filed on 31.10.2017 declaring Nil income after claiming exemption under sections 11 and 12 of the Act. The return was processed u/s 143(1) on 28.09.2018 whereby the exemption claimed by the assessee was denied and total income was assessed at Rs.68,35,923/-.

3.2 Aggrieved, the assessee filed applications u/s 154 on 13.03.2019, 16.04.2019 and 07.06.2019 pointing out that Audit Report in Form No.10B had already been obtained from the auditor on 09.10.2017, i.e., before the due date of filing of return, but due to an inadvertent error the same could not be uploaded electronically on the income-tax portal. Thereafter, Form No.10B was electronically furnished on 13.04.2019 and further rectification applications were filed before CPC. However, the rectification request was rejected and the denial of exemption was continued.

3.3 Before us, the Ld. Authorised Representative submitted that the assessee was duly registered u/s 12A and there is no dispute regarding the charitable nature of its activities. He submitted that Audit Report in Form No.10B had been obtained on 09.10.2017, well before the due date of filing the return, and the delay was only in electronic uploading of the report. The Ld. AR further submitted that the audit report was available on record during the pendency of appellate proceedings and therefore the substantive exemption could not be denied for a mere procedural lapse.

ITA Nos.6625/M/2025 United Jain Students Home (iii) Health Foundation and Research Centre reported in 175 Taxmann.com 447 (Ahd); (iv) Anjana Foundation reported in 168 Taxmann.com 462 (Guj); (v) KLU Organic Ltd. reported in 444 ITR 62 (Del); (vi) Spic Educational Foundation reported in 257 ITR 46 (Mad); (vii) CBDT Instruction F. No.267/482/77-IT(Part) dated 09.02.1978; (viii) Nemco Enterprises reported in 65 Taxmann 307 (Pune); (ix) CBDT Circular No.669 dated 25.10.1993. 5. The Ld. Departmental Representative relied upon the orders of the lower authorities. 6. We have heard the rival submissions and perused the material available on record. There is no dispute that the assessee was holding a valid registration u/s 12A during the relevant assessment year. There is also no dispute that Audit Report in Form No.10B had been obtained on 09.10.2017 before the due date prescribed for filing of return of income. The only lapse on the part of the assessee was that the report could not be uploaded electronically along with the return and was subsequently furnished on 13.04.2019. 6.1 We find that the year under consideration is A.Y. 2017-18. The requirement contained in section 12A(1)(ba) requiring furnishing of return in accordance with section 139(4A) and compliance with the prescribed conditions was introduced with effect from 01.04.2018. Therefore, filling of Form 10B within the prescribed date was directory, rather than mandatory. 6.2 We further find that the consistent view of various Courts and Coordinate Benches relied upon by the assessee is that where the audit report is obtained before the prescribed date and is furnished before completion of appellate proceedings, the requirement of filing Form No.10B is directory and not mandatory. The Hon'ble Gujarat High Court in the cases of Laxminarayan Dev Shrikrishna Seva Kendra and Anjana Foundation, as well as the decisions relied upon by the assessee,

ITA Nos.6625/M/2025 United Jain Students Home have held that substantive exemption cannot be denied merely for technical or procedural defects when the audit report is otherwise available on record. 6.3 In the present case, the assessee had obtained Form No.10B before filing of return, subsequently uploaded the same on 13.04.2019 and the report was very much available when the appeal was pending before the Ld. CIT(A). In our considered view, once the audit report was available before the appellate authority and the assessee was admittedly registered u/s 12A, the Ld. CIT(A) was not justified in sustaining the denial of exemption on a purely technical ground. 6.4 Considering the totality of facts and respectfully following the judicial precedents relied upon by the assessee, we hold that the assessee is entitled to exemption u/s 11 and 12 of the Act. We accordingly set aside the orders of the lower authorities and direct the Assessing Officer to allow the claim of exemption after taking cognizance of Form No.10B already filed by the assessee. 7. In the result, the appeal of the assessee is allowed. Order pronounced in the open court on 11 /06/2026.

Sd/- Sd/- (NARENDER KUMAR CHOUDHRY) (JAGADISH) Judicial Member Accountant Member

Mumbai, Dated: 11/06/2026 PS

ITA Nos.6625/M/2025 United Jain Students Home Copy of the order forwarded to: 1. Appellant 2. Respondent 3. The CIT 4. The CIT (Appeals) 5. The DR, I.T.A.T. By order

(Assistant Registrar) ITAT, Mumbai