ROLON SEALS INTERNATIONAL,HYDERABAD vs. ITO., WARD-11(1), HYDERABAD

3 ITA.No.947/Hyd./2025 rather than disposing the Appeal mechanically overlooking the submissions placed on record. In fact there is no whisper about the contentions of the Appellant in the order passed u/s 250 of the Act by the Commissioner (Appeals).

5. The Ld. Commissioner (Appeals)/NFAC ought to have appreciated the fact that necessary forms (Form 56F) for claiming deduction u/s 10AA of the Act was duly filed before passing the intimation u/s 143(1) of the Act and thus deduction claimed by the Appellant cannot be disallowed even on this count.

6. For these and other grounds that may be urged at the time of hearing, the appellant submits that the Hon'ble ITAT may be pleased to quash the arbitrary adjustment made u/s 143(1) of the Act, which was upheld by the CIT(Appeals)/NFAC, as it is bad in law.”

3. The learned Authorised Representative of the Assessee has submitted that the CPC while processing the return of income has denied the claim of deduction u/sec.10AA on the ground of delay in filing Form-56F. He has referred to the return of income filed by the assessee and submitted that the assessee has duly filed Form-56F along with the return of income on 19.12.2023 which is placed at Page-5 of the paper book. He has then referred to the 4 ITA.No.947/Hyd./2025 intimation issued by the CPC u/sec.143(1)(a) and submitted that the CPC has given the reason for disallowing the claim of deduction u/sec.10AA that Form-56 is not filed, which is contrary to the record when the assessee has filed Form-56 along with the return of income and an acknowledgment is duly issued by e-filing system. Thus, the learned Authorised Representative of the Assessee has submitted that due to date of filing the Form-56 was extended by the CBDT up-to 31.12.2023 which is also admitted by the CPC at page-13 of the paper book while giving the reasons for denial of deduction u/sec.10AA of the Act, then, the Form-56 filed on 19.12.2023 is within the period of due date of filing the said Form as extended by the CBDT. The learned AR has also referred to the Circular No.18/2023 dated 20.10.2023 issued by the CBDT whereby the time period for filing Form-56 was extended up- to 31.12.2023. Even the assessee has duly filed it’s reply explaining this fact to the CPC placed at page-14 of the paper book that Form-56 was filed along with the return of income on 19.12.2023, but, the CPC made the disallowance of the claim of deduction u/sec.10AA without considering the 5 ITA.No.947/Hyd./2025 correct facts and record. He has then referred to the order of the learned CIT(A) and submitted that when all the relevant details, facts and material were available before the CPC as well as learned CIT(A) to confirm the disallowance by learned CIT(A) is not justified. The learned Authorised Representative of the Assessee has further submitted that the Amendment in Sec.10AA is not applicable by the Finance Act, 2023 and is applicable w.e.f. 01.04.2024 and, therefore, the same is not applicable for the assessment year 2023-2024 under consideration. In support of his contention, he has relied upon the decision of ITAT, Delhi Bench in the case of Arvind Kumar Agarwal vs. ITO [2023] 149 taxmann.com 472 (Delhi-Trib.). Hence, the learned Authorised Representative of the Assessee has submitted that the disallowance made by the CPC and confirmed by the learned CIT(A) is highly unjustified and, therefore, the same is liable to be deleted and the claim of the assessee be allowed.

6 ITA.No.947/Hyd./2025

5.1. Thus, it is clear that CPC has acknowledged this fact that the due date for filing Form-56 for the assessment year under consideration was extended to 31.12.2023, but, the claim of the assessee was disallowed on the ground that the assessee has not filed Form-56. It is manifest from the 7 ITA.No.947/Hyd./2025 record that the assessee has filed Form-56 along with the return of income on 19.12.2023 and due acknowledgment has been issued by the e-filing system of the Department as under:

8 ITA.No.947/Hyd./2025 5.2. Thus, it is a matter of record that the assessee has filed Form-56F on 19.12.2023, whereas the due date of filing the Form-56F was extended by the CBDT vide Circular No.18/2023 dated 20.10.2023 up-to 31.12.2023. This fact is not disputed by the Revenue and even the CPC has also acknowledged this fact of extension of due date of filing the Form-56F. Thus, the disallowance of claim of deduction u/sec.10AA by the CPC is highly arbitrary and contrary to the facts and record. The learned CIT(A) has confirmed the disallowance in Paras-4.4 and 4.5 as under : “4.4. It is quite apparent on bare perusal of section 10AA and 143(1)(a)(v) that If the assessee wants to avail deduction 10AA, he has to necessarily furnish the return of the income containing such claim before the due date specified u/s.139(1). Therefore, failure to furnish the return of income before the due date specified u/s.139(1) would disentitle the assessee for the claim of deduction u/s. 10AA and the claim of the assessee for deduction cannot be entertained in contravention of the provisions of section 10AA.

4.5. In the present case, the assessee has filed the return of income on 19.12.2023 which is beyond the due date of 31.10.2023 for the impugned assessment year. There is no dispute on this position. The date of filing of a return of income would be apparent on the face of return and upon a perusal thereof, it would be clear as to whether the return is a valid return, having been filed within the statutory time limit, or a belated one. This is mechanical exercise

9 ITA.No.947/Hyd./2025 and one that can be carried out by the CPC, very much within the scope of section 143(1)(a)(ii) of the Act. Since the return of Income is filed beyond the due date specified u/s.139(1), I do not find any reason to interfere with the disallowance made u/s, 143(1) of the IT Act 1961. The same stands confirmed. The grounds taken are dismissed.”

5.3. All these reasons given by the learned CIT(A) is based on the wrong presumption of the due date of filing the return as 31.10.2023 as against the due date extended up-to 31.12.2023. Accordingly, the impugned order of the learned CIT(A) as well as the disallowance made by the CPC is not sustainable and the same are set-aside. The claim of the assessee for deduction u/sec.10AA is allowed. Though the issue of applicability of the Amendment brought into sec.10AA vide Finance Act, 2023 is not involved in the present appeal, however, for the sake of completeness, we note that this Amendment is applicable w.e.f. 01.04.2024 and hence, the same is not applicable for the assessment year under consideration. The Delhi Bench of the Tribunal in the case of Arvind Kumar Agarwal vs. ITO (supra) has considered this issue and held in Paras-8 to 11 as under :

10 ITA.No.947/Hyd./2025 “8. On perusal of the CIT(A)'s finding extracted (supra), it is not forthcoming precisely why the denial of the deduction u/s 10AA of the L.T. Act is upheld. The CIT(A) has upheld the disallowance referring to sub-sections (5) & (6) of section 10A/10B of the 1.T. Act, which are applicable to the deduction u/s 10AA of the I.T. Act also. The provisions of sub-sections (5) & (6) of section 10A of the LT. Act shall apply to the exemption u/s 10AA of the I.T. Act also by virtue of sub-section (8) of section 10AA of the L.T. Act. However, these sub-sections of 10A do not prescribe the precondition of filing of return within the specified due date u/s 139(1) of the I.T. Act to be eligible for the benefit of section 10AA of the I.T. Act. Sub-section (8) of section 10AA of the 1.T. Act reads as follows:-

"(8) The provisions of sub-sections (5)62 and (6) of section 10A shall apply to the articles or things or services referred to in sub-section (1) as if-

(a) for the figures, letters and word "1st April, 2001", the figures, letters and word "1st April, 2006" had been substituted;

(b) for the word "undertaking", the words "undertaking, being the Unit" had been substituted."

11 ITA.No.947/Hyd./2025 9. Sub-sections (5) & (6) of section 10A of the I.T. Act applicable to the exemption u/s 10AA of the 1.T. Act reads as follows:-

"(5) The deduction under this section shall not be admissible for any assessment year beginning on or after the 1st day of April, 2001, unless the assessee furnishes in the prescribed form, 59[***] the report of an accountant, as defined in the Explanation below sub- section (2) of section 288 60 [before the specified date referred to in section 44AB], certifying that the deduction has been correctly claimed in accordance with the provisions of this section.

(6) Notwithstanding anything contained in any other provision of this Act, in computing the total income of the assessee of the previous year relevant to the assessment year immediately succeeding the last of the relevant assessment years, or of any previous year, relevant to any subsequent assessment year,-

(1) section 32, section 32A, section 33, section 35 and clause (ix) of sub-section (1) of section 36 shall apply as if every allowance or deduction referred to therein and relating to or allowable for any of the relevant assessment years ending before the 1st day of April, 2001, in relation to any 12 ITA.No.947/Hyd./2025 building, machinery, plant or furniture used for the purposes of the business of the undertaking in the previous year relevant to such assessment year or any expenditure incurred for the purposes of such business in such previous year had been given full effect to for that assessment year itself and accordingly sub-section (2) of section 32, clause (ii) of sub-section (3) of section 32A, clause (ii) of sub-section (2) of section 33, sub-section (4) of section 35 or the second proviso to clause (ix) of sub-section (1) of section 36, as the case may be, shall not apply in relation to any such allowance or deduction;

(ii) no loss referred to in sub-section (1) of section 72 or sub-section (1) or sub-section (3) of section 74, in so far as such loss relates to the business of the undertaking. shall be carried forward or set off where such loss relates to any of the relevant assessment years ending before the 1st day of April, 2001;

(iii) no deduction shall be allowed under section 80HH or section 80HHA or section 80-1 or section 80- IA or section 80-IB in relation to the profits and gains of the undertaking; and 13 ITA.No.947/Hyd./2025 (iv) in computing the depreciation allowance under section 32, the written down value of any asset used for the purposes of the business of the undertaking shall be computed as if the assessee had claimed and been actually allowed the deduction in respect of depreciation for each of the relevant assessment year."

Order pronounced in the open Court on 10.12.2025.