KELI CULTURAL ASSOCIATION,MUMBAI vs. CIT (A) INCOME TAX DEPT, MUMBAI

PDF · subscribers
ITA 2615/MUM/2025Status: DisposedITAT Mumbai05 June 2025AY 2019-20Bench: SHRI NARENDER KUMAR CHOUDHRY (Judicial Member)1 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the provision for furnishing the audit report with the return is procedural and directory, not mandatory. Substantial compliance is sufficient, and delay can be condoned if a reasonable cause is shown.

What were the facts?

The assessee filed its audit report late by 48 days due to a bonafide mistake by the Chartered Accountant, but it was submitted before the processing of the return of income. The assessee provided a sworn affidavit explaining the delay.

What were the issues?

Whether the delay in filing the audit report beyond the prescribed time limit, with a reasonable cause, should lead to denial of exemption.

Which sections of the Income-tax Act were involved?

Section 250,Section 143(1),Section 11,Section 12

AI-generated summary — verify with the full judgment below

Cases cited in this judgment(1)Show list

Detected automatically from the text. Citations are also linked where they appear in the judgment. The count shows how many other judgments on BharatTax rely on the same authority.

Income Tax Appellate Tribunal, MUMBAI BENCH “SMC”, MUMBAI

Before: SHRI NARENDER KUMAR CHOUDHRY

For Appellant: Shri Nikhil Natekar, Ld. A.R
For Respondent: Shri P D Chougule, Ld. Sr. D.R
Hearing: 05.06.2025Pronounced: 05.06.2025

O R D E R Per : Narender Kumar Choudhry, Judicial Member:

This appeal has been preferred by the Assessee against the order dated 15.02.2025, impugned herein, passed by the Ld. Addl./Joint Commissioner of Income Tax (Appeals) (in short “Ld. Addl./Joint Commissioner”) under section 250 of the Income Tax Act, 1961 (in short ‘the Act’) for the A.Y. 2019-20.

2.

Though the Assessee had failed to file the audit report in Form 10B within the prescribed time limit due to bonafide mistake of the Ld. Chartered Accountant of the Assessee, as it appears from duly sworn affidavit dated 23.05.2025 (available in paper book at pages No.168-170), however, the same was filed belatedly with a delay of 48 days along with the said affidavit but admittedly before the date of processing the return of income, vide intimation/order dated 26.03.2021 u/s 143(1) of the Act by the CPC/AO and therefore the same could not have been side-lined, which both the authorities have done.

Thus, in view of the judgment of the Hon'ble Gujarat High Court in the case of CIT vs. Gujarat Oil and Allied Industries Ltd. (1993) 201 ITR 325 (Guj.) wherein the Hon'ble High Court was pleased to hold “that provision regarding furnishing of audit report with the return, has to be treated as a procedural proviso, as it is directory in nature and its substantial compliance would suffice the purpose. The benefit of exemption should not be denied merely on account of delay in furnishing the audit report and it is permissible for the Assessee to produce the audit report at a later stage either before the Income Tax Officer or before the appellate authority by assigning sufficient cause”, the appeal of the Assessee is liable to be allowed, specifically in view of the fact that the Assessee in this case has, demonstrated plausible and reasonable cause for delay in filling of audit report, with duly sworn affidavit. Consequently, the AO is directed to recompute the tax liability, while considering claim of the Assessee lodged u/s 11 & 12 of the Act.

3.

Thus, the appeal of the Assessee is allowed in the aforesaid terms. Order pronounced in the open court on 05.06.2025.

More judgments on Section 11

All 7,190 judgments and leading authorities on Section 11 →

Recent GST High Court judgments

Search GST case law →