INDIAN INSTITUTE OF HEALTH AND FAMILY WELFARE,INDIA vs. ITO., EXEMPTION WARD-1(2), HYDERABAD

The assessee has raised the following grounds of appeal:

The brief facts of the case are that the assessee is a Public Charitable Trust, filed its return of income for Assessment Year 2021-22 on 17.03.2022 claiming exemption under Section 10(23C)(iv) of the Income Tax Act, 1961 (“the Act”) amounting to Rs.2,41,16,329/- and declaring the total income of Rs. NIL. During the processing of the return under section 143(1) of the Act, the CPC, Bengaluru denied the exemption claimed by the assessee by holding that the due date for filing the return was 15.03.2022, whereas the assessee had filed the return after the due date. Accordingly, the CPC vide its order dated 25.12.2022 Page 2 of 12 under section 143(1) of the Act computed the total income of the assessee at Rs. 2,41,16,329/-.

Aggrieved with the order of CPC, the assessee filed appeal before the Ld. First Appellate Authority. The Ld. First Appellate Authority after considering the submissions of the assessee dismissed the appeal.

Aggrieved by the order of the Ld. First Appellate Authority, the assessee has preferred the present appeal before this Tribunal. The appeal of the assessee was fixed for hearing on 16.07.2025, and on the request of the authorized representative CA Puja Somani, the appeal was adjourned to 04.08.2025. However, from the second hearing onwards, there has been no appearance on behalf of the assessee on 04.08.2025, 09.09.2025, and 11.11.2025. In view of continuous non-appearance, the appeal is being adjudicated ex-parte qua the assessee, based on the material available on record and after hearing the Learned Departmental Representative (“Ld. DR”).

The Ld. DR relied on the order of the Ld. First Appellate Authority and prayed before the Bench to uphold the order of the Ld. First Appellate Authority.

We have heard the Ld. DR and perused the material available on record. We have also gone through the intimation issued under section 143(1) of the Act, dated 25.12.2022, the relevant portion of which is reproduced as under:

On perusal of the above, it is evident that the due date for filing the return of income in the case of the assessee was 15.03.2022, whereas the assessee filed the return on 17.03.2022. Thus, it is an admitted position that the return of income was filed after the prescribed due date. It is also evident that, the assessee had filed its audit report in Form No. 10BB and claimed exemption under section 10(23C)(iv) of the Act, which was denied by the CPC while processing the return under section 143(1) of the Act. We have also perused para 4.1 to 4.8 of the order of the Ld. First Appellate Authority, which is to the following effect:

On careful examination of above, we find that the findings recorded by Ld. First Appellate Authority are factually inconsistent with the contents of the intimation under section 143(1) of the Act. We observe that the Ld. First Appellate Authority proceeded on the assumption that the assessee had claimed exemption under section 11 of the Act and that the return of income and audit report were filed belatedly. Further, the Ld. First Appellate Authority has also mentioned that the assessee ought to had filed Form 10B instead of Form 10BB. Further, the Ld. First Appellate Authority at para no.4.8 of his order has given the Page 8 of 12 findings that neither the CPC nor the first appellate authority has the power to condone delay in filing ITR or Form 10B. However, as per the intimation under section 143(1) of the Act, the assessee had claimed exemption under section 10(23C)(iv) supported by Form No. 10BB. Hence, it is evident that findings recorded by the Ld. First Appellate Authority are factually inconsistent with the contents of the intimation under section 143(1) of the Act. We have also examined the written submissions filed by the assessee before this Tribunal. The page no. 3 to 5 of the written submission of the assessee is reproduced as under:

On perusal of the above, it is noticed that the assessee is claiming to be registered under section 12A of the Act vide registration certificate dated 13.04.2007. However, the assessee has not clarified whether it has obtained approval under section 10(23C) of the Act. The assessee has also stated that exemption under section 10(23C) of the Act was allowed in earlier years, yet, in the concluding paragraph of its written submission, the assessee seeks exemption under section 10(23C)(iv) on the basis of registration under section 12A of the Act. These submissions appear to be mutually inconsistent. If the assessee is indeed registered under section 12A, then the proper course would be to claim exemption under section 11 of the Act, unless there exists a lawful and subsisting approval under section 10(23C) of the Act. Therefore, the nature of exemption claimed, the basis for such Page 11 of 12 claim, and the existence or absence of approval under section 10(23C) of the Act require detailed factual verification.

In view of the above factual discrepancies and contradictions, and considering that the findings of the Ld. First Appellate Authority are not based on the correct factual record, we deem it appropriate, in the interest of justice, to set aside the matter to the file of the Ld. AO for de novo adjudication of the issue in terms of our observations. It is needless to mention that the Ld. AO shall provide adequate opportunity of being heard to the assessee. The assessee is also directed to cooperate in the remand proceedings without seeking any unnecessary adjournments.