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Facts
The assessee claimed a deduction of Rs. 47,30,484/- under Section 80JJAA for AY 2023-24. This claim was rejected by the DDIT CPC and confirmed by the CIT(A) because the return of income was filed belatedly on 31.12.2023, after the due date of 30.11.2023. However, the assessee had filed Form-DA and reported the deduction in the tax audit report on 30.12.2023, prior to the return filing.
Held
The Tribunal held that the return of income, though filed belatedly under Section 139(1), was filed within the time limit prescribed under Section 139(4) of the Act, which constitutes sufficient compliance. As the assessee had made substantial compliance by filing the tax audit report and Form-DA before the return, the denial of the deduction under Section 80JJAA was unwarranted. The AO was directed to grant the deduction.
Key Issues
Whether a deduction claimed under Section 80JJAA can be denied solely on the ground of belated filing of the return of income under Section 139(1), when the return is filed within the extended time limit of Section 139(4) and other compliance documents were filed timely.
Sections Cited
263, 80JJAA, 139(1), 139(4), 80AS, 11(1), 80IB, 80TB
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “D” BENCH MUMBAI
Before: HON’BLE SHRI SANDEEP GOSAIN & SHRI GIRISH AGRAWAL&
Date of Hearing 17.07.2025 Date of Pronouncement 04.08.2025 आदेश / ORDER
PER SANDEEP GOSAIN, JM:
The present appeal has been filed by the assessee challenging the impugned order dt. 27.01.2025 passed u/s 263 of the Income Tax Act, 1961 (‘the Act’), by the National Faceless Appeal Centre, Delhi (NFAC) for the assessment year 2023-24. 2 R-Pac (India) Pvt Ltd., Mumbai.
The only effective ground raised by the assessee relates to challenging the order of Ld. CIT(A) in confirming the action of DDIT CPC in rejecting the deduction claimed by the assessee u/s 80JJAA of the Act.
In this regard, we have heard counsels for both the parties, perused the material placed on record, judgments cited before us and the orders passed by the revenue authorities. From the records, we noticed that the assessee had filed its return of income on 31.12.2023 thereby claiming deduction u/s 80JJAA of the Act of Rs. 47,30,484/- and also filed Form- DA to claim said deduction on 30.12.2023. It is important to mention that the claim of deduction u/s 80JJAA of the Act had already been reported in Clause – 33 of tax audit report filed on 30.12.2023.
However, the said deduction was denied on the ground that assessee had filed return belated i.e 31.12.2023 whereas the due date was 30.11.2023. 5. After having gone through the entire facts and circumstances of the present case, we are of the considered 3 R-Pac (India) Pvt Ltd., Mumbai. view that in this case the claim of deduction u/s 80JJAA of the Act had already been reported in Clause -33 of the tax audited report filed on 30.12.2023 before filing the return of income which was filed on 31.12.2023 and in this way made claim of deduction in the original return of income. Thus when once substantial compliance has been made by filing the prescribed form before filing return of income, therefore such belated filing of Prescribed form is not factual in the sense that the requirement of rules are not mandatory Perse, but are essentially directory in nature as has been held by the Coordinate Bench of ITAT in the case of Sai Computers Ltd Vs. ADIT (2023), 155 taxmann.com 607 (Delhi).
It was argued by the Ld. DR that the return of income was not filed within the prescribed time as per Sec. 139(1) of the Act, therefore JCIT had rightly rejected the claim of the assessee.
However, we are of the view that the Coordinate Bench of ITAT in the case of Metro Brands Ltd. Vs. DCIT in had held that “delayed filing of return of income was within the time limit prescribed u/s 139(4) of 4 R-Pac (India) Pvt Ltd., Mumbai. the Act, which is a sufficient compliance for the purpose of Sec 80AS of the Act”.
Even Hon’ble Bombay High Court in the case of Trustee of Tulsidas Gopalji Charitable and Chaleshwar Temple Trust Vs. CIT (207 ITR 368) (Bom) (HC) has held as under:
"On a careful reading of section 139 we are of the clear opinion that sub sections (1) and (4) of section 139 have to be read together and on such a reading, the inevitable conclusion is that a return made within the time specified in sub-section (4) has to be considered as having been made within the time prescribed in sub-section (1) or sub-section (2) of section 139. In other words, if a return is filed within the time specified in sub section (4) of section 139 and the option contemplated by the Explanation to section 11(1) is exercised in writing along with such return, the requirements of the Explanation to section 11(1) would stand satisfied,"
We also draw strength from the decision of the Coordinate Bench of this Tribunal in the case of Sukhkarta Developers and Builders Vs PCIT (Nagpur) (Trib) 596 & 597/Nag/2016 dated 01/08/2018 wherein it was held as under:
"12. From the above exposition from the Honble jurisdictional High Court which duly has the mandate from the Hon'ble Apex Court, it transpires that the submission of return within time as specified under sub section (4) of section 139 has to be taken as sufficient compliance for the provision of the Income Tax Act, 1961, as it was expounded that the sub section (1) and sub section (4) of section 139 have to be read together and, hence, it is the inevitable conclusion that a return made 5 R-Pac (India) Pvt Ltd., Mumbai. within the time specified in sub section (4) has to be considered as having been made within the time prescribed in sub section (1) of the Act.
On the touch stone of the above said exposition, we find that there is no infirmity in the Assessing Officer's order on granting the assessee the deduction u/s. 80IB of the Income Tax Act, 1961. It is not the case that the returns were filed beyond the time limit for sub section 139(4)."
Thus, as per the facts of the present case, although, the assessee has filed the audit report in time but belated filed return of income, therefore, after considering the legal proposition as laid down in the aforementioned orders/judgments by different judicial authorities, we are of the view that the provision of filing of return of income U/s 139(1) are directory in nature and thus return filed U/s 139(4) of the Act is to be treated as ‘sufficient compliance’ as has been held by the Coordinate Bench of this Tribunal in the case of Sukhkarta Developers and Builders Vs. PCIT in & 597/Nag/2016 dated 01.08.2018. Wherein it was categorically held that claim of the assessee cannot be disallowed U/S 80TB of the Act only on the ground that the return of income was filed beyond the period stipulated U/s 139(1) of the Act. The submission of return within time as specified under sub- section (4) of Section 139 has to be taken as ‘sufficient compliance’ under the provisions of the Act as it was expounded that sub-section (1) and sub-section (4) of 6 R-Pac (India) Pvt Ltd., Mumbai.
Section 139 have to be read together. Thus, keeping in view the above settled provisions of law, we reach to an inevitable conclusion that the return of income so filed by the assessee in the present case within the time specified in sub-section (4) of Section 139 of the Act has to be considered as filed within the time prescribed in sub- section (1) of Section 139 of the Act. Thus, on this JJAA ground, the denial of deduction u/s 80JJAA of the Act was warranted. Thus, the assessee succeeds on this account and AO is directed to grant deduction u/s 80JJAA to the assessee if otherwise found entitled.
In the result, the appeal filed by the assessee stands allowed.