Saints Peter And Paul Church vs. THE COMMISSIONER OF INCOME TAX (EXEMPTION)

The petitioner states that the petitioner has filed Audit Report dated 14.07.2014 in Form No.10B for the Assessment Year 2013-2014 (Financial Year 2012-13) through Online Portal of the Income Tax Department on 24.09.2014. The same has been electronically acknowledged by the portal. Subsequent to the filing of Ext.P1 Audit Report, the petitioner has filed Income Tax Return on 17.11.2014 through the portal, providing the details of total receipts and application as prescribed under Section 11 of the Act. The 3rd respondent-Assistant Commissioner of Income Tax has rejected the claim of the application submitted by the petitioner and passed an intimation under Section 143(1) of the Act on 27.03.2015 demanding Rs.4,33,286/- without recording any reasons for rejection by Ext.P3. 3. In response to Ext.P3 intimation, the petitioner submitted a rectification application through the portal and the same was transferred to the 2nd respondent-Income Tax Officer for rectification under Section 154 of the Act. The 2nd respondent-Income Tax Officer passed Ext.P6 order under Section 154 of the Act on 19.07.2021, confirming the intimation on the ground of not filing Audit Report in Form No.10B within the due date, without considering the Audit Report filed on the Portal. Aggrieved by Ext.P6 order, the petitioner filed Revision under Section 264 of the Act before the 1st respondent-Commissioner of Income Tax on 03.03.2023 which was also of no avail.

Counsel for the petitioner would submit that the impugned order of the 1st respondent-Commissioner of Income Tax is in violation of Section 12A(b) read with Ext.P8(a) instruction by the Central Board of Direct Tax. The intention of the CBDT is to ensure that a claim under Section 11 and 12 could not be denied on the ground that the Audit Report is not filed along with the Return and the claim is eligible even on filing the Audit Report on an anterior date.

Standing Counsel entered appearance on behalf of the respondents and resisted the writ petition. The Standing Counsel controverted all the material allegations made by the petitioner in the writ petition. On behalf of the respondents, it is submitted that the petitioner ought to have filed Audit Report along with Income Tax Return in view of Section 12 A(b) of the Income Tax Act. In the circumstances, the writ petition is not maintainable and liable to be dismissed, contends the Standing Counsel.

I have heard the learned Counsel for the petitioner and the learned Standing Counsel representing the respondents.

From the pleadings it is evident that the petitioner had filed the Audit Report on 24.09.2014. The Income Tax Returns were filed on 17.11.2014. Though the provision mandates that Audit Report should be filed along with Income Tax Return, as the petitioner has filed the Audit Report in advance even before filing of the Income Tax Return. I am of the view that there is substantial compliance of mandatory provisions of the Act.