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Facts
The assessee claimed accumulated refund of ₹80 lakhs under Section 11(2) of the Act, but failed to file Form 10 for the assessment year 2013-14. The AO disallowed the application of income and added ₹80 lakhs to the total income in the assessment year 2018-19. The CIT(A) upheld the AO's finding.
Held
The Tribunal held that failure to file Form 10 for the assessment year 2013-14 constitutes a default in that year. Consequently, the amount should be treated as income of assessment year 2013-14 and not the year under consideration (2018-19). The order of the lower authorities was set aside.
Key Issues
Whether the addition of ₹80 lakhs for non-filing of Form 10 in assessment year 2013-14 is sustainable in assessment year 2018-19, when the default occurred in the earlier year.
Sections Cited
11(2)
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Income Tax Appellate Tribunal, ‘A’ BENCH, BANGALORE
Before: SHRI WASEEM AHMED & SHRI SOUNDARARAJAN K
PER WASEEM AHMED, ACCOUNTANT MEMBER:
This is an appeal filed by the assessee against the order of the NFAC, Delhi vide order dated 20/12/2024 in DIN No.ITBA/NFAC/S/250/2024- 25/1071401242(1) for the assessment year 2018-19.
The issue raised by the assessee in ground No. 6 is that the learned CIT(A) or in confirming the addition of ₹ 80 lakhs for nonfiling of form 10 pertaining to the year assessment year 2013-14, in the year under consideration i.e. 2018-19.
The assessee in the year under consideration claimed that it has accumulated refund of ₹ 80 lakhs under the provisions of section 11(2)
Page 2 of 4 of the act which was utilised year under consideration. However the AO found that it is compulsory for the assessee to furnish form 10 for accumulating the fund under the provisions of section 11(2) of the act but the assessee has not been done so. As such it was the allegation of the AO that the assessee has not filed form 10 in the assessment year 2013- 14 for setting a part sum of ₹ 80 lakhs which was claimed to be utilised in the year under consideration. Thus the AO in the absence of filing of form 10, disallowed the application of income of the assessee and added the sum of ₹ 80 lakhs the total income of the assessee.
On appeal, the learned CIT a upheld the finding of the AO.
Being aggrieved by the order of hundreds ITA the assessee is in appeal before us learned AR before us filed a paper book running from pages 78 to 127 and a brief synopsis having 11 pages. It was contention of the learned AR that if assuming the form 10 was not furnished and the amount which was claimed to be set apart under section 11(2) of the act can only be brought to tax in that particular AR to which pertains i.e. assessment year 2013-14 and the same cannot be made subject to the addition in the year under consideration.
On the other hand the Ld. AR before us vehemently supported the order of the authorities below.
We have heard the rival contentions of both the parties and perused the materials available on record. The controversy before us relates whether non-furnishing of form 10 under the provisions of .
Page 3 of 4 section 11(2) of the act for claiming the benefit of the amount which was set apart to be utilised in future, such amount will be treated as income to which it pertains ie. assessment year when the default was committed. Since the default according to the revenue has been committed in the assessment year 2013-14 therefore in our considered view the amount of in dispute can only be added as income of the assessee in the assessment year 2013-14 and not in the year under consideration. Even at the time of hearing the learned DR could not bring any material on record against the argument advanced by the learned counsel for the assessee. Accordingly we set aside the order of hundreds ITA and direct the AO to delete the addition made by him. Hence the ground of appeal of the assessee is hereby allowed.
7.1 At the time of hearing the learned counsel submitted that if the assessee succeeds on the issue raised in ground No. 6, it is unwanted press any other ground. Accordingly we are not inclined to adjudicate the other grounds of appeal raised by the assessee as the become infructuous. Accordingly we dismiss the same as infructuous.
In the result the appeal filed by the assessee is hereby partly allowed.