JAN SEVA MANDAL ,MUMBAI vs. INCOME TAX OFFICER EXEMPTION WARD -1(4), MUMBAI
Income Tax Appellate Tribunal, MUMBAI BENCH “F” MUMBAI
Before: SHRI OM PRAKASH KANT () & MS. KAVITHA RAJAGOPAL () Assessment Year: 2023-24
PER OM PRAKASH KANT, AM This appeal, at the instance of the assessee, is directed against the order dated 19.03.2025 passed by the Learned Additional/Joint Commissioner of Income Tax (Appeals) – 1, Lucknow [hereinafter “Ld. CIT(A)”], for the Assessment Year 2023–24. The assessee has raised multiple grounds challenging the denial of exemption under Section 11 of the Income-tax Act, 1961 (hereinafter “the Act”) by the Centralized Processing Centre (CPC), Bengaluru during processing of return under Section 143(1) of the Act on account o reproduced as under 1. On the fa law the [CIT(A)] exemption resorted Income referred Return of the grou filed bela was filed i 2. The lear failed to filing the mandatory that dela lapse and exemption particularl on record under Sec 3. The lear explanatio and the various dealing the Act. 4. It is su Section 1 denial of into huge TDS refun 1. A sum Act b applica stated exceed held in 2. A sum or set read w ITA of belated filing of the audit report in Form No : facts and in the circumstances of the learned Commissioner of Income- erred in confirming the n/deductions under Section 11 to by the Centralized Proces Tax Department, Bengaluru ( to as “CPC - ITD”) while p of Income under Section 143(1) of nds that the Audit Report in Fo atedly, though with the Return of in prescribed time. rned CIT(Appeals) and the learned appreciate that the time limit p e Audit Report is only declarato y. The lower authorities failed ay in filing the Audit Report is only d the same cannot be fatal leading n/benefits under Section 11 o ly when the said Audit Report w d when the Return of Income w ction 143(1) of the Act. rned CIT (Appeals) failed to ap ons/submissions furnished by th legal position emerging from the High Courts/Income-tax Appella with amended provisions of Sectio ubmitted that the denial of exe 11 of the Act, as discussed above f deductions of the following amo e demand of Rs. 18,25,840/- after nd of Rs. 1,05,613/- against the Appellant m of Rs. 17,61,379/- under section 1 being amount accumulated or se ation to charitable or religious purpos objects of the trust to the extent d 15 per cent of income derived n trust. m of Rs.33,00,000/- being amount t apart for specific purposes under with section 11(5) of the Act. Jan Seva Mandal 2 A No. 3445/MUM/2025 o. 10B. , which are e case and in -tax (Appeals) denial of of the Act ssing Centre, (herein after rocessing the f the Act on rm 10B was Income which CPC - ITD prescribed for ory and not to appreciate y a procedural g to denial of of the Act was available was processed appreciate the he Appellant decisions of ate Tribunals on 12A(b) of emption under e, has led to unts resulting adjusting the t: 1(1 )(a) of the et apart for ses or for the t it does not from property t accumulated section 11 (2)
A sum Section expend income 6. It is sub are unju exemption unwarran It is submitted and in law, adjustments the Return of 7. It is subm under Sec Form 10-B same adjustmen 143(l)(a)/1 It is subm adjustmen 143(1) of t 2. Briefly stated, f charitable trust, regis its return of income f 29.11.2023 declarin processed by the As (CPC) under Section determined at ₹51,92 denied exemption un days in e-filing of the that although the du to 30.11.2023, the r be filed one month ITA m of Rs.43,938/- under section 1 n 11(6) of the Act being the amou diture incurred to be allowed as e. bmitted that the disallowances refer ustified and bad in law as th n under Section 11 of the Act itself is i ted. d that on the facts and in the circumstan the learned CIT(Appeals) erred in resorted to by the learned CPC - ITD w Income under Section 143(1) of the Act. mitted that the basic issue leading to deni ction 11 of the Act viz. delay in filing the B, itself is a highly debatable question cannot be the gr nt/additions/disallowances under 143(l) of the Act. mitted that the learned CPC - ITD has nts without complying with the provisi the Act. facts of the case are the asses stered under the provisions of th for the assessment year under c g total income at ₹86,859. T ssessing Officer at Central Pr n 143(1) of the Act and the to 2,176. The CPC, while passing nder Section 11 of the Act, cit e audit report in Form 10B. It i ue date for furnishing the return equirement under the law was prior to such extended due d Jan Seva Mandal 3 A No. 3445/MUM/2025 11 read with unt of capital application of rred to above he denial of ill-founded and nces of the case confirming the while processing ial of exemption Audit Report in of law and the round for r Section resorted to the ions of Section ssee is a public he Act, and filed consideration on The return was rocessing centre otal income was the said order, ting delay of 29 s not in dispute n stood extended that Form 10B date. The audit report was filed on prescribed timeline. A 11(2), and 11(6) wa were made under Sec 3. In appeal, the the CPC, holding th prescribed time as p appellate authority, 18.11.2024, observe CIT(A) lacked juri i and was advised Commissioner or Ch under Section 119(2 CIT(A) is reproduced
“Decision:
6.1 The state appealed aga issue for adj pertains to th
Section 12 of section 143(1
prescribed tim clubbed and a 6.2 It is noted denied the adjustment opportunity t
143(1)(a) are 6.3 The foreig
ITA
11.2023 and thus held to As a result, exemption under S as disallowed and consequenti ction 143(1)(a) of the Act. Ld. CIT(A) affirmed the adjustm hat the audit report was not f per Section 12A(1)(b) read with relying on CBDT Circular No. ed that the Assessing Officer ction to condone the delay in f d to approach the juri ict hief Commissioner for condon )(b) of the Act. The relevant fin as under: ement of facts, grounds of appeal, and ainst have been thoroughly examined. T judication among all the grounds of app he sole issue of denying the benefit of Se f the Act while processing the return of Inc ) of the Act as Form 10B was not filed me limit. Therefore, all grounds of appea adjudicated together. d that while processing the return of Inco exemption claimed u/s 11 and 12. u/s 143(1)(a) was done after pro to the appellant. The reason for adjus as follows:
gn contribution entered at SI. No. B(iil) o
Jan Seva Mandal
4
A No. 3445/MUM/2025
be beyond the ections 11(1)(a), ial adjustments ments made by filed within the h Rule 17B. The 16/2024 dated as well as the filing Form 10B tional Principal nation of delay nding of the Ld.
d the order
The central peal raised ection 11 &
come under d within the al are being ome, the AO
The said viding the stment u/s of Schedule
VC by the t
10(23C)(iv)/(v
Form 10B at return u/s 1
Audit Report
Income charg of Section 13
the Income Ta
6.4 The appe adjustments accumulated expenditure c of Form 10B,
The Appellan circumstances late release
Appellant hig return proces should not aff denial of exem lapses violate unlawful. Th reversed, an precedents th requirements.
6.4 The conte context, it's im and Rule 17B mandatory. F online and m mentioned in the due date f
139(1) of the A 6.5 In the pr
November 29, one month pr due date for October 31, 2
2023. There
Hence, Form the Act.
6.6 In view of disallow the ITA trust or institution claiming exemption v)/(vi)/(via) and is required to file aud least one month prior to the due date for 39(1). However, the assessee has not in Form 10B within specified due da eable to tax will be recomputed as per th
(10) or twenty second proviso to Section ax Act as applicable.
ellant submitted that the CPC ITD made under Section 143(1), disallowing under Section 11 (1 )(a), Section 11(2), a claimed as income application, due to th the audit report, which was filed on 2
nt argued that this delay was due s, including the complexity of accountin of the new Form 10B utility. Additi ghlighted that Form 10B was available ssing and that filing delays are proce ffect exemption claims. The Appellant as mptions under Section 11 based on these es natural justice, and the CPC ITD’s ac e Appellant requested that the disallo nd exemptions granted, citing relev hat allow for substantial compliance with ention of the appellant has been conside mportant to note that according to Sectio
B, Trusts are obligated to file Form 10B
Form 10B can only be accessed and must be filed no later than the spe
Section 44AB of the Act, which is one m for submitting the Income Tax Return un
Act.
resent case, the appellant submitted Fo
, 2023, while the deadline for filing Form rior to the due date for submitting the R submitting the return in case of the app
2023 which was further extended to No was a delay of 29 days in filing the 10B was not filed within the time frame of the above, I find no error in the AO’s appellant's claim for exemption under Jan Seva Mandal
5
A No. 3445/MUM/2025
u/s 11 or it report in r furnishing
E-filed the ate. Hence, he provision n 10(23C) of e significant g amounts and capital e late filing
29.11.2023. to genuine ng and the ionally, the before the edural and sserted that e procedural ctions were owances be vant legal procedural ered. In this on 12A(1)(b)
B, which is d submitted ecified date month before nder Section orm 10B on m 10B was Return. The pellant was vember 30,
Form 10B.
outlined by decision to Section 11
and 12 of th
143(1) of the A 7.1 Further, S guidelines reg any provision
Section 119(2
1. 1…..
2. the Board m for avoiding g general or sp being a Joi
(Appeals) to deduction, ref expiry of the such applicat accordance w
7.2 In this c issued Circu excerpts from Sub: C the In 9A/10/
subseq
In supe by the time to in filin
2018-1
exercis the Inc
1.1
the Pr.
Commissione applications
9A/10/1OB/
subsequent a days.
1.2 the Pr. Ch
Commissione
ITA he Act when processing the return und
Act.
Section 119 empowers the Board to issue garding the condonation of delay in comp n of the Act. Section 119(2) reads as follow
2) may, if it considers it desirable or expedie genuine hardship in any case or class of ecial order, authorise any income-tax au int Commissioner (Appeals) or a Co admit an application or claim for any efund or any other relief under this Ac period specified by or under this Act f tion or claim and deal with the same o with law."
context, the Central Board of Direct Tax ular 16/2024 dated 18.11.2024. Th m the same are as follows:
Condonation of delay under section 1
ncome-tax Act, 1961 in filing of /10B/10BB for Assessment Year 201
quent assessment years - Reg.
ersession of all earlier Circulars/Instruct
Central Board of Direct Taxes ('CBDT’) f o deal with the applications for condonati ng Form 9A/10/10B/1 OBB for Assess
19 and subsequent assessment years, th se of the powers conferred under section come Tax Act ('the Act’), authorizes:
. Commissioners of Income
Tax
(T rs of Income Tax ('CsIT') to admit and for condonation of delay in filing
IOBB for Assessment
Year
201
assessment years where there is a delay hief Commissioners of Income Tax (Tr. CC r of Income Tax ('CCsIT')/ Director G
Jan Seva Mandal
6
A No. 3445/MUM/2025
der Section orders and pliance with ws:
ent so to do of cases, by uthority, not mmissioner exemption, ct after the for making n merits in xes (CBDT) he relevant
119(2)(b) of Form No.
18-19 and tions issued from time to ion of delay sment Year he CBDT in 119(2)(b) of Tr.
CsIT’)/
d deal with Form No.
8-19
and of upto 365
CsIT’)/ Chief
Generals of Income Tax condonation o
Assessment where there is 2. The Pr. CC applications
9A/10/10B/
was prevente before the exp hardship on m
2.1
Furthe
Pr. CsIT/ CsI that the amou deposited in a sub-section (5
3. No applica
9A/10/1 OB/
from the end is made. The years from th application fil condonation possible, with such applicati
4. The deleg
Circular shall under section of issue of thi
7.3 It is evide the Act that Income Tax (A (Appeals) [CI
119(2)(b) of th in filing Form
7.4 Therefore
JCIT(Appeals) the statute to for Form 10B.
7.5 The ap juri ictiona
ITA
('DGsIT’) to admit and deal with appli of delay in filing Form No. 9A/10/1 OB/
Year 2018-19 and subsequent assessm s a delay of more than 365 days.
CsIT/ CCsIT/ Pr. CsIT/ CsIT while enterta for condonation of delay in filing
1 OBB, shall satisfy themselves that th ed by reasonable cause from filing s piry of the time allowed and the case is merits.
r, in respect of Form No. 10, the Pr. CCs
IT as the case may be, shall also satisfy unt accumulated or set apart has been any one or more of the forms or modes s
5) of section 11 of the Act.
ation for condonation of delay in filing o
B/1 OBB shall be entertained beyond t of the assessment year for which such time limit for filing of such application w he end of the assessment year will be ap led on or after the date of issue of this application should be disposed of, hin six months from the end of the mont ion is received by the Competent Authorit gation of powers, as per para 1.1 &
l cover all such applications for condonati n 119(2)(b) of the Act which are pending is Circular.
i ent from the CBDT Circulars and Section the Assessing Officer (AO), Joint Comm
Appeals) [JCIT(A)], and Commissioner of I
IT(A)] do not have the authority und he Income Tax Act to grant condonation fo
10B.
e, neither the AO during return processin
) i when finalizing the appeal, are emp o entertain the appellant's condonation
.
ppellant has the option to appr al
Commissioner of Income
Ta
Jan Seva Mandal
7
A No. 3445/MUM/2025
ications for /1 OBB for ment years aining such Form No.
he applicant such Forms of genuine sIT/ CCsIT/
themselves invested or specified in of Form No.
three years application within three pplicable for Circular. A as far as th in which ty.
1.2 of this ion of delay as on date
119(2)(b) of missioner of Income Tax der Section or the delay ng nor I, the powered by application roach the ax,
Chief
Commissione
Commissione delay in fil
Sections 11
In view of the a result, dism
4. We have heard the relevant material assessee submitted delay in filing Form
(Exemptions). A copy placed on record. It despite being appris appeal without await support of his subm judgment of the H
Foundation v. PCIT- wherein the Hon’ble the form No. 10B w principle thatv appro balancing and judic denied merely on the 4.1 In the present c of exemption under S of Form No. 10B. It fact, filed before th
ITA er of Income
Tax, or Princip er of Income Tax for the condonati ling Form 10B and to claim the b and 12 of the Act.
e above, I find no merit in the current app miss the appeal.”
rival submissions of the parti ls on record. Before us, the Ld.
that an application seeking m 10B had already been filed y of the said application dated is the assessee’s contention t sed of this fact, proceeded to ting disposal of the condonation mission, the Ld. Counsel has r
Hon’ble Bombay High Court i
-6, Mumbai (Writ Petition No.
Court condoned the delay of 2
which was rejected by the ld oach of Authorities oughts to b cious and availing exemption bar of limitation.
case, the limited controversy pe
Section 11 solely on the ground is not in dispute that the audi he date of return filing and w
Jan Seva Mandal
8
A No. 3445/MUM/2025
pal
Chief ion of the benefits of peal and, as ies and perused
Counsel for the condonation of before the CIT d 19.01.2024 is that the CIT(A), dispose of the n application. In relied upon the in Mirae Asset
713 of 2025),
24 days in filing d CIT(E) on the e of equitious, , should not be ertains to denial of delayed filing it report was, in was very much available at the time
Form 10B was of 2
16/2024 (supra), the the concerned Prin
Income Tax.
4.2 In our considere already pending con was incumbent upon await the outcome o disallowance, witho condonation petition,
The Hon’ble Bombay has held that where forthcoming, the ben be denied solely on otherwise the conditi
4.3 Respectfully fol
Bombay High Court the juri ictional Pr
Income Tax to examin condonation of delay upon being satisfied cause.
ITA of processing of the return. Th
29 days. In light of the CBD e juri iction to condone such d ncipal Commissioner/Chief Co ed view, when the condonation nsideration before the compete n the CIT(A) to defer the decisio of such application. Proceedin out waiting for the adjudi
, has caused prejudice to the as y High Court in Mirae Asset Fou e delay is not inordinate and nefit of exemption under Section n account of procedural non ons of the statute are fulfilled.
llowing the binding precedent and considering the CBDT Cir rincipal Commissioner/Chief C ne and dispose of the assessee’s in filing Form 10B in accordan that the delay was occasioned
Jan Seva Mandal
9
A No. 3445/MUM/2025
he delay in filing
DT Circular No.
delay vests with ommissioner of application was ent authority, it n in appeal and ng to affirm the ication of the ssessee.
undation (supra) d explanation is n 11 should not n-compliance, if of the Hon’ble rcular, we direct
Commissioner of s application for nce with law and d by reasonable
4 We further rest direction to adjudic authority disposes of grant liberty to the a the said condonation 4.5 In view of the a restored to the file o with law. The grou statistical purposes. 5. In the result, t statistical purposes. Order pronoun (KAVITHA RA JUDICIAL M Mumbai; Dated: 22/07/2025 Rahul Sharma, Sr. P.S.
Copy of the Order forward
1. The Appellant
2. The Respondent.
3. CIT
4. DR, ITAT, Mumbai
5. Guard file.
////
ITA tore the matter to the file of th cate the appeal afresh after f the condonation application. T assessee to place on record the f n request.
above, the grounds raised by t of the ld CIT(A) for adjudication unds raised by the assessee he appeal filed by the assesse nced in the open Court on 22
d/-
AJAGOPAL)
(OM PRAK
MEMBER
ACCOUNTA ded to :
BY ORDER
(Assistant Re
ITAT, Mu
Jan Seva Mandal
10
A No. 3445/MUM/2025
he CIT(A) with a the competent
The CIT(A) shall final outcome of he assessee are n in accordance are allowed for e is allowed for /07/2025. KASH KANT)
ANT MEMBER
R, gistrar) umbai