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Facts
The assessee filed its income tax return on 19.9.2023, which was processed under Section 143(1) on 10.1.2024. Form 10ID was filed on 21.11.2022, after the due date of 21.10.2022, leading the AO (CPC) to reject the benefit of the new tax regime. The Ld CIT(A) dismissed the appeal, citing the late filing of the return.
Held
The Tribunal found that although Form 10ID was filed late, it was available before the Assessing Officer on the date of processing the return. Citing a decision of the Hon'ble Gujarat High Court, the Tribunal held that the action of the AO and Ld CIT(A) was incorrect and unsustainable. The AO was directed to accept Form 10ID and allow the new tax regime benefit.
Key Issues
Whether the benefit of the new tax regime can be denied solely due to the late filing of Form 10ID, even if the form was available with the Assessing Officer before the processing of the return under Section 143(1).
Sections Cited
143(1), 119(2)(b), 115BAA, 139(1), 10B(8), 10B(5), 11, 12, 115BAB, Article 226
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Assessment Year : 2023-24
The brief facts of the case are that the assessee filed its return of income on 19.9.2023 which was processed u/s.143(1) of the Act on 10.1.2024. The assessee filed form 10 ID on 21.11.2022 against the due date 21.10.2022. The AO, CPC accordingly rejected the benefit of new tax regime to the assessee in the intimation u/s.143(1) of the Act.
In the appellate proceedings, the ld CIT(A) dismissed the appeal of the assessee for the reason that the assessee has filed the return late.
After hearing the rival submissions and perusing the materials available on record, I find that the benefit of new tax regime was denied on the ground of late filing of Form 10ID, which was filed on 21.11.2023 as against the due date 21.10.2022. I note that on the date of processing of the return u/s.143(1) of the Act, the form 10ID was available before the Assessing Officer on 10.1.2024, therefore, the action of AO (CPC) is not correct and cannot be sustained and so also the order of the ld CIT(A). The above view finds support from the decision of Hon’ble Gujarat High Court in the case of Royal Led Equipment (P) Ltd vs CCIT (2025) 174 taxmann.com 61 (Gujarat), wherein, the Hon’ble High Court has held as under:
“8. DISCUSSION & FINDINGS:- 8.1 In the decision of this Court in the case of V.M.Procon Pvt. Ltd. (Supra), this Court held as under:- "25. Considering the above facts, respondent No.2 ought to have condoned the delay in filing Form 10-IC by the petitioner instead of rejecting the review application filed by the petitioner on technical
P a g e 2 | 8 Assessment Year : 2023-24 "13. On perusal of the above circular, it appears that on receipt of the representation, the CBDT has exercised the powers under Section 119(2)(b) of the Act to avoid the genuine hardships to the domestic companies in exercise of the option under Section 115BAA of the Act on fulfilling the above three conditions. The petitioner, however, could not file the Form electronically on or before 30th June, 2022 because the petitioner had already filed the Form 10IC for the Assessment Year 2021-2022 so as to see that the petitioner at least gets the benefit of the reduced rate of tax for the said Assessment Year. The petitioner, however, was entitled to file the Form as per the aforesaid Circular but the petitioner has not filed the Form 10IC for the Assessment Year 2021-2022. The petitioner therefore had no option but to make an application under Section 119(2)(b) to treat the Form 10IC filed for Assessment Year 2021-2022 as if the same is filed for Assessment Year 2021 as per the aforesaid Circular.
It is true that the petitioner could not have made such a prayer of treating Form 10IC filed for Assessment Year 2021-2022 for Assessment Year 2021. The petitioner ought to have prayed for permission to file the Form 10IC for the year 2021 as per the Circular No.6 of 2022 under Section 119(2)(b) of the Act by treating the Form 10IC filed for subsequent year 2021-2022 as null and void as the petitioner had already opted for a reduced rate of tax for Assessment Year 2021 in the return of income which was permitted to be regularised by condoning the delay in filing Form 10IC as per Rule 21AE of the Rules by the CBDT by issuing the aforesaid Circular for Assessment Year 2021.
The contention raised on behalf of the respondent that in view of the decision of the Hon'ble Apex Court in case of Wipro Limited (Supra), the petitioner is not entitled to file Form 10IC belatedly after the filing of the return under Section 139(1) of the Act is concerned, the said aspect is taken into consideration by this Court in case of Commissioner of Income Tax versus Gujarat Energy Developement Agency by considering the decison of the Wipro Limited (Supra) vis-a- vis the filing of Form 10B to claim the exumption under Sections 11 and 12 of the Act as under : NEUTRAL CITATION C/SCA/14786/2024 JUDGMENT DATED: 11/03/2025 undefined "5. Reliance placed by the learned advocate for the appellant on the decision of M/s.Wipro Limited (supra) would not be applicable in the facts of the case, as in the facts of the present case, the assessee has claimed the exemption under Section 11 read with Section P a g e 4 | 8 Assessment Year : 2023-24 Hon'ble Apex Court in case of Wipro Limited (Supra) wherein, the Hon'ble Apex Court has held as under : "10. Even the submission on behalf of the assessee that it was not necessary to exercise the option under section 10B (8) of the IT Act and even without filing the revised return of income, the assessee could have submitted the declaration in writing to the assessing officer during the assessment proceedings has no substance and the same cannot be accepted. Even the submission made on behalf of the assessee that filing of the declaration subsequently and may be during the assessment proceedings would have made no difference also has no substance. The significance of filing a declaration under section 10B (8) can be said to be co- terminus with filing of a return under section 139(1), as a check has been put in place by virtue of section 10B (5) to verify the correctness of claim of deduction at the time of filing the return. If an assessee claims an exemption under the Act by virtue of Section 10B, then the correctness of claim has already been verified under section 10B(5). Therefore, if the claim is withdrawn post the date of filing of return, the accountant's report under section 10B(5) would become falsified and would stand to be nullified."
On perusal of the above observation of the Hon'ble Apex Court, it is also apparent that the Hon'ble Apex Court has considered the significance of filing declaration under Section 10B(8) of the Act considering the provisions of Section 10B(5) of NEUTRAL CITATION C/SCA/14786/2024 JUDGMENT DATED: 11/03/2025 undefined the Act being a check to verify the correctness of the claim of deduction at the time of filing of return so that if an assessee claims an exumption under the Act by virtue of Section 10B of the Act, then the correctness of the claim has already been verified under Sub-section (5) of Section 10B and therefore, if the claim is withdrawn post the date of filing of return, the report of the Accountant filed under Section 10B(5) of the Act would become falsified and would stand to be nullified. However, the provisions of Section 115BAA of the Act are in a way granting relief to the assessee-Companies to enable them to pay the reduced rate of tax at rate of 22% on exercise of the option on the various conditions mentioned therein.
In such circumstances, the respondent No.1 was required to consider the facts of the case by permitting the petitioner to file a fresh Form 10IC and condoning the delay in filing such Form by moulding the prayer made by the petitioner to treat the Form 10IC filed by the petitioner for Assessment Year 2021-2022 to be treated as that of for Assessment Year 2021. The provisions of Section 119(2)(b) of the Act are meant for redressal of the grievance and hardships caused to the P a g e 6 | 8 Assessment Year : 2023-24 situation, this Court deems it appropriate to exercise its jurisdiction under Article 226 of the Constitution of India to quash and set aside the impugned order dated 26.06.2024 passed by the Respondent No.1 under Section 119(2)(b) and further direct the Respondent-authorities to accept Form 10-ID filed under Section 115BAB of the Act .”
Respectfully following the decision of Hon’ble Gujarat High Court referred (supra), I direct the Assessing officer to accept form 10 ID filed by the assessee and allow the return of income filed by the assesse under new tax regime.
In the result, appeal of the assessee is allowed.
Order dictated and pronounced in the open court on 12 /9/2025