ANAND SHAIKSHANIK SAMJIK SEVABHAVI SANSTHA KALAJAWADE,KOLHAPUR vs. INCOME TAX OFFICER,EXEMPTION WARD,KOLHAPUR, KOLHAPUR

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH “SMC”, PUNE BEFORE SHRI MANISH BORAD, ACCOUNTANT MEMBER AND SHRI VINAY BHAMORE, JUDICIAL MEMBER आयकर अपील सं. / ITA Nos.2144, 2145 & 2146/PUN/2026 िनधा�रण वष� / Assessment Years : 2020-21, 2022-23 & 2021-22 Anand Shaikshanik Samjik Vs. ITO, Exemption Ward, Sevabhavi Sanstha Kolhapur. Kalajawade, Kalazwade, Tal. Panhala, Kolhapur- 416000. PAN : AADTA0195M Appellant Respondent Assessee by : Shri Pramod S. Shingte Revenue by : Shri Sandeep Jumale (Virtual) Date of hearing : 04.08.2026 Date of pronouncement : 07.10.2026 आदेश / ORDER PER VINAY BHAMORE, JM: These appeals filed by the assessee are directed against the separate orders dated 30.12.2025 passed by Ld. Addl./JCIT(A)-2, Ludhiana [‘Ld. CIT(A)’] for the assessment years 2020-21, 2022-23 and 2021-22 respectively. 2. There is delay in filing of the above captioned three appeals. After going through the application for condonation of delay, we are satisfied with the reasons mentioned in the application for condonation of delay duly supported by an affidavit that the

2 ITA Nos.2144, 2145 & 2146/PUN/2026 applicant was prevented by sufficient & reasonable cause for not filing the appeals within the prescribed time limit. After hearing Ld. DR, we condone the delay and proceed to adjudicate the appeals. 3. Since the facts and issues are identical and the above captioned three appeals were heard together, therefore, we proceed to dispose of the same by this common order. ITA No.2144/PUN/2026, A.Y. 2020-21 : 4. The appellant has raised the following grounds of appeal :- “1. On the facts and circumstances of the case and in law the ADDITIONAL CIT(A)-2, LUDHIYANA erred in confirming the action of the Income Tax Officer, Exemption ward, Kolhapur (hereinafter referred to as the ‘AO’) of disallowing exemption under S. 11 for delayed filing of Form 10B, not accepting the submission of the appellant that: a. Submission of Form 10B being only a procedural requirement, addition of the gross receipts is incorrect only on such ground particularly when, though late, the appellant having complied with requirement. b. The addition, if any, ought to have been restricted only to the Net commercial income and not the entire Gross Receipts. The appellant prays that the AO be directed accordingly in the matter. The appellant craves leave to add to, amend, alter, modify, delete or add a new ground of appeal before or at the time of hearing.” 5. Facts of the case, in brief, are that the assessee is a charitable trust duly registered under Bombay Public Trust Act and also

3 ITA Nos.2144, 2145 & 2146/PUN/2026 registered u/s 12A of the IT Act & engaged in the activity of providing educational facility to general public. The assessee filed its return of income on 23.12.2020 within the extended time limit by declaring income of Rs.46,382/- after claiming deduction u/s 11 of the IT Act. Vide order dated 30.11.2021 the above return was processed by CPC by determining the income of the assessee at Rs.42,79,091/-. The above assessed income includes addition of Rs.42,32,709/- being disallowance of deduction u/s 11 of the IT Act since the assessee did not filed Form 10B audit report within the prescribed time limit. 6. Being aggrieved, the assessee preferred an appeal before Ld. CIT(A). After considering the reply and submissions and also the additional ground raised by the assessee with regard to claim of exemption u/s 10(23C)(iiiad) of the IT Act, Ld. CIT(A) allowed the appeal for statistical purposes by observing as under :- “6.9 Hence, based upon the above discussion and the decision of the Apex Court in the case of Principal Commissioner of Income -tax v Wipro Ltd, it is held that the case of the appellant falls under section 11 and 12 of the Act which is part of Chapter -III of the Act and the claim of the appellant’s plea for want of Form 10B is rejected and the action of the A.O of disallowing the deduction per provision of the Act is hereby upheld and confirmed. Also, it is evident from the above discussion that the Assessing Officer(AO), Addl./Joint Commissioner of Income(Appeals)[Addl/JCIT(A)], and Commissioner of Income Tax(Appeals)[CIT(A)] do not have the authority under section 119(2)(b) of the Act to grant condonation for delay in filing of Form no. 10B. The appellant has the option to approach the competent

4 ITA Nos.2144, 2145 & 2146/PUN/2026 authority authorized by the CBDT for condonation of delay in filing of Form 10B and to claim the benefits of section 11 and 12 of the Act. 6.10 However, during the appellate proceedings, it has been submitted that appellant trust mainly runs an educational institution solely for educational purpose and not for purpose of profit and its gross receipts for the year under consideration is Rs. 42,79,091/-. As per the provisions of section 10(23C)(iiid) of the Act, the appellant has fulfilled all the condition for claiming exemption and thus is eligible for claiming exemption u/s 10(23C)(iiid) of the Act. Therefore, the AO is directed to verify the facts and allow exemption u/s 10(23C)(iiid) of the Act, if the appellant fulfilled all the conditions as per the provisions of section 10(23C)(iiid) of the Act, as the appellant has not claimed exemption u/s 10(23C)(iiid) of the Act. Thus, the ground of appeal is allowed for statistical purpose.” 7. It is the above order against which the assessee is in appeal before this Tribunal. 8. We have heard Ld. counsels from both the sides and perused the material available on record including the paper book & copy of case laws furnished by the assessee. In this regard, we find that the assessee has not challenged the finding of Ld. CIT(A) wherein the matter was restored back to the file of the Assessing Officer to verify the facts and allow exemption u/s 10(23C)(iiid) of the Act, if the appellant fulfilled all the conditions as per the provisions of section 10(23C)(iiid) of the Act. Before us, the assessee has raised ground no.1(a) regarding disallowance of exemption u/s 11 for belated filing of Form 10B audit report and alternatively in ground no.1(b) it is requested to restrict the addition only to the extent of net commercial income instead of the entire gross receipts.

5 ITA Nos.2144, 2145 & 2146/PUN/2026 9. In this regard, we find that Form 10B audit report was not only filed belatedly (filed on 20-11-2024) but was also obtained beyond the period prescribed under the Act (Obtained on 20-11-2024). We further find that in a number of decisions passed by the coordinate benches of this Tribunal, it has been held that the filing of Form 10B audit report is procedural, however, the same is necessarily required to be obtained before the prescribed date mentioned in the Statute. In this regard, we find support from decision relied on by the assessee in the case of Dr. Sukumar J. Magdum Foundation vs. ITO in ITA No.320/PUN/2023 order dated 14.08.2023. Since in the instant case in hand Form 10B audit report was required to be obtained on or before 10-01-2021, however, the same was obtained & filed on 20.11.2024, we do not find any error in the order passed by Ld. CIT(A) in this regard & accordingly, ground no.1(a) raised by the assessee is dismissed. 10. However, we find force in the alternative ground no.1(b) raised by the assessee, wherein the assessee requested to direct the Assessing Officer to restrict the addition to net commercial income only, by relying on coordinate bench decision passed in the case of Dr. Sukumar J. Magdum Foundation (supra), wherein the Tribunal allowed the appeal for statistical purposes by observing as under :-

6 ITA Nos.2144, 2145 & 2146/PUN/2026 “2. Briefly stated, the facts of the case are that the assessee e-filed its return declaring total income at Nil. The return was processed u/s.143(1) by observing that the assessee did not file audit report in Form No.10B, which was a condition precedent for claiming exemption u/s.11. Thereafter, a rectification order was passed on 22-07-2021, noting that Form No.10B was neither uploaded nor any application was filed for condonation of delay, and, as such, the benefit of exemption was rightly denied in the Intimation. In this order, the Assessing Officer (AO) observed that the Intimation u/s. 143(1) determined the total income at Rs.4,31,18,956/- by not allowing deductions at Rs.4,95,86,799/-. The assessee appealed to the ld. CIT(A), claiming the benefit of exemption u/s.11, which was again jettisoned on the ground that the Audit report in Form No.10B was finally signed on 27-08-2021 and uploaded on 05-03-2022, which did not satisfy the conditions for exemptions u/s.12A, namely, that the Audit report should be signed before the specified date and the said Audit report in Form No.10B should be furnished before the stipulated date. This is how the assessee’s appeal came to be dismissed. Aggrieved thereby, the assessee has come up in appeal before the Tribunal. 3. We have heard the rival submissions and gone through the relevant material on record. The contentions about the late filing of Audit report in Form No.10B and the need for still granting exemption, were not seriously pressed. The ld. AR has raised an additional ground to the effect that total income of the assessee ought to have been determined on commercial principles and not by charging the gross receipts to tax. The additional ground, being, legal in nature and not requiring any fresh examination of the factual matrix, is hereby admitted. As such, the only issue which survives for our consideration is the examination of the manner of assessment by the AO considering that it was not having any registration so as to qualify for exemption u/s.11. 4. The AO has recorded in the order u/s.154 that the gross receipts of the assessee were Rs.4,31,18,956/- and no deduction was allowed for expenses to the tune of Rs.4,95,86,799/-. We have gone through the Income and Expenditure account of the assessee, whose copy has been placed at page 18 of the paper book. Total of gross receipts on the Income side comes to Rs.4,31,18,955/-, which has been correctly considered by the AO. However, the amount of total deductions, as taken note of by the AO at Rs.4.95 crore, is not borne out from the Expenditure side. It appears that the AO took the amount of gross receipts at Rs.4.13 crore and added 15% at around Rs.64.00 lakh, to compute the total expenditure at Rs.4.95 crore. In fact, the assessee’s Income and Expenditure Account shows that “Surplus of Income over Expenditure” at Rs.2,87,153/-. In addition, there is “Amount transferred to Reserve or Specific Funds” to the tune of Rs.9,54,000/-. The assessee has claimed deduction for various expenses. It goes

7 ITA Nos.2144, 2145 & 2146/PUN/2026 without saying that income tax is charged on the income and not the gross receipts. Income is determined by reducing the expenses incurred, described under various sections in Chapter IV-D of the Act. If the benefit of exemption u/s.11 is not available, the total income needs to be computed in accordance with the regular provisions of the Act. In the given circumstances, where the AO has charged tax on gross receipts, we cannot countenance the same. The resultant impugned order also deserves to be set aside. We order accordingly and remit the matter to the file of the AO for deducing the total income in accordance with the law after considering the deductibility of various expenses noted in the Income and Expenditure Account. Needless to say, the assessee will be allowed a reasonable opportunity of hearing. 5. In the result, the appeal is allowed for statistical purpose.” 11. Respectfully following the above decision passed by coordinate bench of this Tribunal in the case of Dr. Sukumar J. Magdum Foundation (supra) and also in the light of the fact that the Ld. CIT(A) has already restored the matter back to the file of the Assessing Officer for verification of assessees claim of exemption u/s 10(23C)(iiiad) of the IT Act, we also deem it appropriate to remand the matter back to the file of the Assessing Officer to decide the issue of taxability of assessee’s net commercial income after verifying the expenditure claimed & after providing reasonable opportunity of hearing to the assessee. Accordingly, ground no.1(b) raised by the assessee is allowed for statistical purposes. Accordingly, in view of our above discussion we direct the Jurisdictional Assessing Officer to verify both the claims made by

8 ITA Nos.2144, 2145 & 2146/PUN/2026 the assessee i.e. with regard to the taxability of net commercial income and the claim of exemption u/s 10(23C)(iiiad) of the IT Act and to allow whichever claim is more beneficial to the assessee. Thus, the ground no.1(b) raised by the assessee is allowed for statistical purposes. 12. In the result, the appeal filed by the assessee in ITA No.2144/PUN/2026 for A.Y. 2020-21 is partly allowed for statistical purposes. ITA Nos.2145 & 2146/PUN/2026, A.Ys. 2022-23 & 2021-22 : 13. Since the facts and issues involved in the remaining two appeals of the assessee in ITA Nos.2145 & 2146/PUN/2026 for A.Ys. 2022-23 & 2021-22 are identical to the appeal of the assessee in ITA No.2144/PUN/2026 for A.Y. 2020-21 therefore, our decision in ITA No.2144/PUN/2026 for A.Y. 2020-21 shall apply mutatis mutandis to the remaining two appeals of the assessee in ITA Nos.2145 & 2146/PUN/2026 for A.Ys. 2022-23 & 2021-22. Accordingly, the remaining two appeals of the assessee in ITA Nos.2145 & 2146/PUN/2026 for A.Ys. 2022-23 & 2021-22 are also partly allowed for statistical purposes

9 ITA Nos.2144, 2145 & 2146/PUN/2026 14. In the result, the appeals filed by the assessee in ITA Nos.2145 & 2146/PUN/2026 for A.Ys. 2022-23 & 2021-22 are partly allowed for statistical purposes. 15. To sum up, all the above captioned three appeals filed by the assessee are partly allowed for statistical purposes, as indicated above. Order pronounced on this 07th day of October, 2026. Sd/- Sd/- (MANISH BORAD) (VINAY BHAMORE) ACCOUNTANT MEMBER JUDICIAL MEMBER पुणे / Pune; �दनांक / Dated : 07th October, 2026. Sujeet/DOC Sujeet Kumar Digitally signed by Sujeet Kumar Sharma Sharma Date: 2026.10.08 12:27:41 आदेश क� �ितिलिप अ�ेिषत / Copy of the Order forwarded to : +05'30' अपीलाथ� / The Appellant. 1. ��यथ� / The Respondent. 2. 3. The Addl./JCIT(A)-2, Ludhiana. 4. The Pr. CIT/CIT concerned. िवभागीय �ितिनिध, आयकर अपीलीय अिधकरण, “SMC” ब�च, 5. पुणे / DR, ITAT, “SMC” Bench, Pune. गाड� फ़ाइल / Guard File. 6. आदेशानुसार / BY ORDER, // True Copy // Assistant Registrar आयकर अपीलीय अिधकरण, पुणे / ITAT, Pune.