SHREE NATHKRUPA SHIKSHAN PRASARAK MANDAL,KOLHAPUR vs. ITO (EXEMPTION), KOLHAPUR

Assessee has raised following grounds of appeal:-

On the facts and in the circumstances of the case and in law, the learned CIT (A) not justified in confirming the denial of exemption u/s 11 of the Act by CPC.

On the facts and in the circumstances of the case and in law, the learned CIT (A) erred in holding that exemption u/s 11 is not allowed though the return of income has been furnished within the time

On the facts and in the circumstances of the case and in law, the Ld. CIT (A) not justified in taxing receipts ignoring the application of income /expenses made as only net surplus is taxable as income.

The appellant craves, to consider each of the above grounds of appeal without prejudice to each other and craves leave to add, alter, delete or modify all or any of the above grounds of appeal.

At the outset Ld. Counsel for the assessee submitted that since the assessee has furnished the return within the time limit prescribed u/s 139(4) of the Act the case of the assessee is squarely covered by the clarifications issued by the Central Board of Direct Taxes (CBDT) vide notification No. 173/193/2019-ITA-I, dated 23.04.2019. He also submitted that the case of the assessee is also covered by various decisions of co-ordinate Benches including Exemption Circle, Pune ITA No. 764/PUN/2025, dated 30.09.2025, Moonank Welfare Society Vs. ITO ITA No. 465/Chd/2023 dated 13.06.2024 and also in the case Exemption, Kolhapur ITA No. 2677/PUN/2024 dated 25.06.2025. 4. On the other hand 175/PUN/2023 dated 23.03.2023. 5. We have heard rival contentions and perused the records placed before us. We observe that the assessee is a charitable organization working in the field of imparting education and runs an educational institute and mainly receiving income from Government grants. Return of income for A.Y. 2020-

We observe that the assessee in order to claim exemption u/s 11 of the Act needs to fulfill the conditions prescribed u/s 12A of the Act. One of the condition provided u/s 12A(1)(ba) of the Act is that the person in receipt of the income has to furnish the return of income for the previous year in accordance with the provisions of sub-section 4A of section 139 within the time allowed under that section. We further note that through the amendment by Finance Act w.e.f. 01.04.2023, sub-section 1 or sub-section 4 has been inserted in section 12A(1)(ba) of the Act. This means that post 01.04.2023 if an assessee has furnished the return u/s 139(1) or 139(4) then the condition prescribed u/s 12A(1)(ba) stands fulfilled.

We would also like to take note of the notification issued by CBDT on 23.04.2019 and the same is reproduced below:-

So far as the decisions referred by Ld. Departmental Representative (DR) in the case of Arya Samaj (Supra), we note that the said decision was rendered ex-parte quo assessee and the CBDT Circular dated 23.4.2019 referred (Supra) remained to be considered. Therefore this decision relied by Ld. Sr. DR is not applicable on the instant appeal.

Our finding that the assessee who has furnished the return u/s 139(4) of the Act for A.Y. 2020-21 is eligible for examination u/s 11 of the Act is further supported by the decision of this Tribunal in the case of Indian Medical Association (Supra) wherein also under similar facts of filing belated return, assessee’s claim u/s 11 of the Act has been allowed by this Tribunal.

We accordingly set aside the impugned finding of Ld. CIT(A) and allow the grounds of appeal raised by the assessee and direct the Ld. JAO to allow benefit of section 11 claimed by the assessee.