CITIBAKE INDUSTRIES,MANGALURU vs. DCIT CIRCLE 1(1), MANGALURU

At the outset, it is noticed that the appeal is filed with a delay of 86 days. The assessee has filed a petition for condonation of delay along with affidavit. On perusal of the affidavit furnished by the assessee, we are satisfied that there is reasonable cause for filing the appeal with a delay of 86 days. We therefore condone the delay of 86 days and proceed to adjudicate the appeal on merits.

Briefly stated facts of the case are the assessee filed its return of income for the Assessment Year 2023-24 on 29.09.2023 admitting a total income of Rs.57,15,290/-. The return was summarily processed under section 143(1) of the Act by disallowing the deduction claimed by the assessee for Rs.11,39,522/- under section 80JJAA of the Act, due to the reason that the assessee filed Form 10DA belatedly on 31.12.2023. The assessee filed the rectification request under section 154 of the Act before the CPC which was rejected on 21.05.2024.

On being aggrieved by the intimation, assessee carried the matter before learned CIT(A). Before the learned CIT(A) the assessee submitted that mere delay in filing of Form 10DA cannot be fatal and result in denial of deduction under section 80JJAA of the Act. The learned CIT(A) found the reason to be unjustifiable, upheld the Order of the learned AO by dismissing the appeal of the assessee.

On being aggrieved by the Order of the learned CIT(A), assessee is in appeal before us by raising various grounds. The only issue agitated by the assessee is with respect to denial of deduction under section 80JJAA of the Act for having filed Form 10DA belatedly on 31.12.2023 but before processing return of income u/s 143(1) on 19.02.2024. The learned AR submitted that the issue is covered by the Co-ordinate Bench of the Tribunal in the case IIFL Samasta Finance Ltd. v. DCIT reported in (2025) 176 taxmann.com 278 and therefore prayed that a mere delay in filing Form 10DA cannot lead to denial of deduction claimed under section 80JJAA of the Act. He also submitted that filing of Form 10DA is directory and not mandatory which was upheld by various judicial decisions. He therefore prayed that deduction under section 80JJAA of the Act be allowed to the assessee

Per contra, the learned DR submitted that filing of Form 10DA is a mandatory requirement and not directory. The learned DR heavily relied on the Order of learned CIT(A).

We have heard the rival submissions and perused the material available on record. It is a fact that the assessee has filed return of income on 29.09.2023 and claimed deduction u/s 80JJAA by filing Form 10DA on 30.12.2023. Filing of Form 10DA being a directory requirement shall not be deterrent in claiming the benefit of deduction u/s 80JJAA of the Act. The CPC ought to have taken into consideration the Form filed belatedly by the assessee. Moreover, the assessee has filed Form 10DA on 30.12.2023 whereas the intimation was generated on 14.03.2024. On the date of generation of the intimation, the Form 10DA is available in the ITBA Portal, the CPC ought to have taken into consideration the Form filed belatedly by the assessee. Further, we also note that section 80JJAA sub-section 2 Clause C of the Act prescribe that the assessee himself furnish the report of the accountant in Form 10DA of the Act before the specified date referred to in section 44AB of the Act. Section 44AB of the Act defines the specified date. The specified date means date one month prior to the due date for furnishing the return of income u/s 139(1) of the Act. However, Rule 19AB of the Income Tax Act Rules, 1962 states as follows:-

On the plain reading of the above rule we note that Rule 19AB stipulates that report of accountant to be furnished along with the return of income. However, in our opinion when there is inconsistency between provisions of the Act and the Rules, the provisions of the Act will prevail. The co-ordinate Bench in the case of Sai Computers Ltd v. Asstt. DIT, CPC [2023] 155 taxmann.com 607 (Delhi - Trib.) held as under:

In the case of CIT v. G. M. Knitting Industries (P.) Ltd [2016] 71 taxmann.com 35/[2015] 376 ITR 456 (SC)the Hon'ble Supreme Court held that, even though it is necessary to file certificate in Form 10CCB along with the return of income, but even if the same has not been filed with the return of income, but the same was filed before the final order of assessment was made, the assessee was entitled to claim deduction under section 80-IB. The Co-ordinate Bench of Bangalore in IIFL Samasta Finance Ltd. v Dy. CIT [2025] vs DCIT reported in 76 taxman.com.278, it was held that even though the requirement of furnishing the report of an accountant in Form 10DA is mandatory the filing thereof is a procedural aspect once the report of the accountant in Form 10DA was available before the CPC at the time of processing intimation u/s 143(1) of the Act even though the same may not be filed on or before the due date of furnishing the same the assessee is entitled to claim the deduction u/s 80JJAA of the Act. We extract below the relevant Para:

In the result, appeal of the assessee is allowed for statistical purposes.