Commissioner Of Income Tax vs. Environmental Planning And Co-Ordination Organisation

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ITA/97/2009HC Madhya Pradesh07 October 2014Bench: HON'BLE SHRI JUSTICE RAJENDRA MENON2 pages
For Petitioner: Sanjeev Tuli
AI SummaryDismissed

What did the High Court hold?

The Tribunal held that the delay in filing the Auditor's Report in Form No. 10B does not automatically disentitle the assessee to the benefit of exemption under section 11 of the Income Tax Act. The Tribunal found that the appellate authorities had exercised their discretion appropriately by condoning the delay, considering the bonafide reasons for it. The Tribunal noted that there were no discrepancies in the Auditor's Report, no concealment of income, and no errors in the assessee's return submission. Therefore, the Tribunal concluded that no substantial question of law arose for consideration, and the order of the appellate authorities granting the exemption was not erroneous. The appeal filed by the Revenue was dismissed.

What were the facts?

The Commissioner of Income Tax, Bhopal, filed an appeal under section 260-A of the Income Tax Act against an order dated February 20, 2009, passed by the Income Tax Appellate Tribunal (ITAT) in I.T.A. No. 18/Ind/2006. The assessment year in question is 2002-03. The assessee, Environmental Planning & Coordination Org, a society registered by the Government of Madhya Pradesh, was assessed on a total income of ₹4,37,25,520/-. The Assessing Officer denied the benefit of exemption because the Auditors Report in the prescribed form No.10B was not enclosed with the return. The assessee appealed this decision. The appellate authorities, including the Commissioner and the ITAT, condoned the delay in filing the Auditor's Report and granted the benefit of exemption under section 11 of the Income Tax Act.

What were the issues?

1. Whether the Tribunal erred in condoning the delay in filing the Auditor's Report in Form No. 10B and thereby allowing the benefit of exemption under section 11 of the Income Tax Act, 1961, despite the delay? The Assessee's contention, as understood from the judgment, is that a mere delay in the submission of the Auditor's Report should not be a ground for denying the benefit of exemption, especially when the report itself was without discrepancy, there was no concealment of income, and no errors were pointed out by the Assessing Officer in the return submission. The Assessee argued that the delay was for bonafide reasons. The Revenue's contention, as understood from the judgment, is that the failure to enclose the Auditors Report in the prescribed form along with the return warranted the denial of exemption. The Revenue likely argued that timely compliance with procedural requirements is essential for claiming statutory benefits.

Which sections of the Income-tax Act were involved?

Section 260-A,Section 11,Section 143(3)

AI-generated summary — verify with the full judgment below

I.T.A. NO :: 97 / 2009

Commissioner of Income Tax, Bhopal Vs. Environmental Planning & Coordination Org

07.10.2014. Shri Sanjay Lal for the appellant This is revenue’s appeal under section 260-A of the Income Tax Act calling in question tenability of the order-dated 20.2.2009 passed by the Income Tax Appellate Tribunal in I.T.A. No. 18/Ind/2006. Assessment proceedings for the year 2002-03 was completed against the assessee under section 143(3) and a total income of `4,37,25,520/- was assessed. The assessee is a Society registered by the Government of Madhya Pradesh for promoting environmental studies. During the course of assessment, the Assessing Officer found that Auditors Report in the prescribed form No.10-B was not enclosed alongwith the return. Accordingly, the benefit of exemption was denied, the assessment was completed and assessment order passed. However, when the matter was called in question by the assessee in appeal before the Commissioner and the Appellate Tribunal, the delay in filing the Auditor’s Report was condoned and exercising its power under section 11 of the Income Tax Act, the appellate authorities have concurrently held that mere delay in submission of the Auditor’s Report cannot be a ground for denying the benefit of exemption, when there was no discrepancy in the Auditor’s Report; there was no concealment of income or any error pointed out by the Assessing Officer in the matter of submission of the return by the Organization.

2 Finding the respondents to have bonafide reasons for the delay in filing the Auditor’s Report, the Auditor’s Report has been accepted and certain modifications made to the assessment order. In doing so, we are of the concerned view that the discretion exercised by the appellate authorities and the reasons given for extending the benefit of section 11 of the Income Tax Act, no error has been committed and no substantial question of law in the matter arises for consideration, warranting interference. Accordingly, the appeal stands dismissed.

(RAJENDRA MENON) (SANJAY YADAV)

J U D G E J U D G E

Aks/-

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