SHRI MOTILAL NAGAR SMRITI SHIKSHAN SAMITI,INDORE vs. CIT EXEMPTION, BHOPAL

ITA 384/IND/2025Status: DisposedITAT Indore22 December 2025AY 2020-216 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the AO's order granting the benefit of accumulation was valid and not erroneous or prejudicial to the interest of the revenue. The Tribunal noted that the assessee had initially filed Form No. 9A mistakenly but rectified the error by filing Form No. 10 during the assessment proceedings, before the AO passed the assessment order. The Tribunal referred to numerous judicial pronouncements that hold that if the required form is available to the AO before the completion of assessment, the substantive benefit cannot be denied. Regarding the condonation of delay by the CBDT under Section 119, the Tribunal referred to the Gujarat High Court's decision in Indian Panel Board Manufacturer Vs. DCIT, which held that the application under Section 119(2)(b) is an additional remedy and not compulsorily resortable. The Tribunal found that the Ld. DR could not controvert the judicial approach favouring the assessee. Consequently, the Tribunal quashed the revision order passed by the CIT(E) and restored the original assessment order passed by the AO. The assessee succeeded in the appeal.

What were the facts?

The assessee, Shri Motilal Nagar Smriti Shikshan Samiti, a charitable trust, is in appeal against a revision order dated 25.03.2025 passed by the CIT(Exemption), Bhopal, under Section 263 of the Income-tax Act, 1961. This revision order arose from the assessment order dated 09.09.2022 passed by the AO under Section 143(3) r.w.s. 144B for Assessment Year 2020-21. The CIT(E) initiated revision proceedings, viewing the AO's order as erroneous and prejudicial to the revenue. The core issue pertains to the assessee's claim of accumulated income of Rs. 1,59,80,555/-. The CIT(E) noted that the assessee filed Form No. 9A instead of Form No. 10 for accumulation, and subsequently filed Form No. 10 with a significant delay of 365 days without condonation from the CBDT. The AO had allowed the benefit of accumulation, which the CIT(E) found objectionable.

What were the issues?

1. Whether the assessment order passed by the AO, allowing the benefit of accumulation of income amounting to Rs. 1,59,80,555/- to the assessee, was erroneous and prejudicial to the interest of the revenue, thereby attracting revisionary jurisdiction under Section 263 of the Income-tax Act, 1961? Assessee's contentions: The assessee argued that the AO had raised a specific query regarding the accumulated income. The assessee provided a detailed reply, explaining that Form No. 9A was filed mistakenly and Form No. 10 was subsequently filed to rectify the error. The assessee also submitted judicial rulings stating that delayed filing of forms is a procedural irregularity and should not deny the substantive benefit. The assessee contended that the AO considered these submissions and passed a valid assessment order, hence no error or prejudice to revenue occurred. Revenue's contentions: The revenue argued that the AO had not conducted a proper enquiry and passed a cryptic order. The revenue relied on case laws stating that cryptic orders without adequate enquiry attract revisionary jurisdiction under Section 263.

Which sections of the Income-tax Act were involved?

Section 263,Section 143(3),Section 144B,Section 11(1),Section 11(2),Section 119

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, INDORE BENCH, INDORE

Before: SHRI SIDDHARTHA NAUTIYAL

For Appellant: Shri Harsh Vijaywargiya, AR
For Respondent: Shri Anup Singh, CIT-DR
Hearing: 15.12.2025

Per B.M. Biyani, A.M.:

Feeling aggrieved by revision-order dated 25.03.2025 passed by learned CIT (Exemption), Bhopal [“CIT(E)”] u/s 263 of Income-tax Act, 1961 [“the Act”] which in turn arises out of assessment-order dated 09.09.2022 passed by learned Assessment Unit of Income-tax Department [“AO”] u/s 143(3) r.w.s. 144B of the act for Assessment-Year [“AY”] 2020-21, the assessee has filed

this appeal on the grounds raised in Appeal-Memo (Form No. 36).

Shri Motilal Nagar Smriti Shikshan Samiti ITA No. 384/Ind/2025 - AY 2020-21

2.

The background facts leading to present appeal are such that the assessee, a trust engaged in charitable purpose an

The order continues below.

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