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Income Tax Appellate Tribunal, INDORE BENCH, INDORE
Before: SHRI B.M. BIYANI & SHRI PARESH M. JOSHI
आदेश/ O R D E R
Per B.M. Biyani, A.M.:
Feeling aggrieved by order of first appeal dated 18.11.2024 passed by learned Commissioner of Income-Tax (Appeals)-Addl/JCIT(A)-1, Coimbatore [“CIT(A)”] which in turn arises out of intimation of assessment dated 29.01.2024 passed by learned CPC, Bengaluru [“AO”] u/s 143(1) of Income- tax Act, 1961 [“the Act”] for Assessment-Year [“AY”] 2023-24, the assessee has filed this appeal.
Page 1 of 9 such that the assessee-individual filed her return of AY 2023-24 on 04.10.2023 u/s 139(1) after claiming a deduction of Rs. 13,80,198/- u/s 80-IB. The AO processed this return vide intimation dated 29.01.2024 u/s 143(1) denying the deduction claimed by assessee. Ld. AR submits that the denial of deduction was for the reason of non-filing of Form No. 10CCB (C.A.
Certificate) before filing return of income. The assessee filed Form No. 10CCB on 23.02.2024 and thereafter filed a rectification-application u/s 154 on the very same day of 23.02.2024. The AO disposed of assessee’s rectification-application vide order dated 13.06.2024. The assessee, however, filed appeal to CIT(A) against the original intimation u/s 143(1). The CIT(A) has, vide impugned order dated 18.11.2024, dismissed assessee’s appeal.
Now, aggrieved by CIT(A)’s order, the assessee has come in next appeal before us.
We have heard learned Representatives of both sides and case record perused.
Before us, Ld. AR at first submitted certain facts, viz. (i) the assessee filed tax audit report of auditors on 20.09.2023 showing deduction u/s 80- IB of Rs. 13,80,198/- [Page 3-4 of Paper-Book], (ii) the CA of assessee generated UDIN certificate of Form 10CCB on 20.09.2023 on the website of The Institute of Chartered Accountants of India [Page 5 of Paper-Book], (iii) the assessee filed return of income on 04.10.2023 claiming impugned
Page 2 of 9 obtaining the CA Certificate in Form No. 10CCB was done before filing return of income and the return of income was also filed before its due date on 31.10.2023 u/s 139(1). However, what could not be done was the uploading of Form No. 10CCB. Ld. AR submitted that the assessee subsequently after receipt of intimation u/s 143(1), uploaded Form No.
10CCB on 23.02.2024 and filed application u/s 154 on the same day.
Relying upon CBDT Circular No. 669 dated 25.10.1993 and No. 689 dated 24.08.1994, Ld. AR submitted that the CBDT has clarified that if the evidence supporting deduction had been omitted to be furnished alongwith return, the AO is empowered to entertain application u/s 154 for rectification of intimation u/s 143(1) or order u/s 143(3) and decide the issue on merit. Ld. AR further relied upon following decisions:
(a) Hon’ble Karnataka High Court in ITO Vs. Smt. Mandira D. Vakharia
(2001) 250 ITR 432:
“8. By the Board circular, it has been made clear that if the audit report specified under Section 80HHC(4) is not furnished with the return, then the deduction may be disallowed as a prima facie adjustment. But, if evidence is subsequently furnished, rectification under Section 154 should be carried out to the extent permitted by the Board Circular No. 669, dated October 25, 1993 (see [1993] 204 ITR (St.) 105). The circular then proceeds to mention some other provisions in regard to the non-filing of the audit report or other evidence along with the return of income as required under various Sections such as 12A(b), 33AB(2), 35E(6), 43B (first proviso), 80-I(7), 80-IA(8) and the like. The case of the Revenue is that since Sections 80HHE and 80GG are not specifically mentioned in the Board circular, the assessee would not be entitled to the benefit of deductions under Sections 80HHE and 80GG on the furnishing of the audit report/proof with the rectification application.
Page 3 of 9 AY 2023-24 9. The submission is without any substance. The intention of the Board is clear. The illustrations and instances referred to in the Board circular are qualified by the words ". . . and the like". The illustrations and instances given by the Board are not exhaustive. The intention behind the Board circular is that in case the audit report required to be filed, was not furnished with the return of income, then the deduction claimed can be disallowed as a prima facie adjustment. But, if it is furnished subsequently, then rectification should be carried out to the extent permitted by the Board Circular No. GG9, dated October 25, 1993 (see [1993] 204 ITR (St.) 105). The illustrations given in the Board circular, being not exhaustive, it would include provisions like Sections 80HHE and 80GG as well. The assessee has claimed the same relief as would have been admissible to an assessee who was claiming deduction under Section 80HHC(4) and other sections mentioned in the Board's circular. The assessee claiming deduction under Sections 80HHE and 80GG of the Act would be similarly situated as an assessee claiming deduction under Section 80HHC(4) of the Act or other provisions mentioned in the Board circular. The use of the words " . . . . and the like", in the Board circular, would include the assessees who are claiming a similar relief although the provision of the Act is not specifically mentioned in the Board circular.
The assessee would be entitled to the deductions in the rectification under Section 154 to the extent permitted by the Board Circular No. 669, dated October 25, 1993 (see [1993] 204 ITR (St.) 105). The Assessing Officer was not right in law in disallowing the rectification application only on the ground that the assessee had failed to furnish the audit report along with the return of income.
The Tribunal was right in law in extending the benefit of the Board circular to the assessee's case as well. The Assessing Officer has rightly been directed to rectify his order and extend the benefit of deductions under Sections 80HHE and 80GG of the Act to the assessee in terms of the Board's circular.
For the reasons stated above, the substantial questions of law on which the appeal is admitted, are answered in the affirmative, i.e.. in favour of the assessee and against the Revenue.” (b) ITAT, Lucknow in M/s Satish Cold Storage Vs. DCIT, &
77/Lucknow/2021, AY 2017-18 & 2018-19:
“4. I have heard the rival parties and have perused the material available on record. I find that it is undisputed fact that the claim of the assessee u/s. 80IB has not been allowed by the authorities below only because of the reason that the audit report in Form-10CCB was not filed along with return of income and was only filed after receipt of intimation u/s. 143(1) and therefore, the assessee filed rectification applications u/s. 154 of the Act after uploading Form-10CCB which was rejected by CPC. The ld. CIT(A) has rejected the appeals by holding that there was no mistake apparent from Page 4 of 9 AY 2023-24 record. However, while holding so, he escaped the contents of Circular No.689 dated 24.8.1994 which clearly directs the Officers to allow rectification u/s. 154 for non-filing of audit report or other evidence which could not be filed with the return of income. For the sake of completeness, the contents of Circular No.689 are reproduced below: XXX 5. I further find that taking cognizance of this circular the Hon'ble High Court of Karnataka in the case of ITO vs. Smt. Mandira D Vakharia vide order dated 17.11.2000 has decided similar issue in favour of the assessee. The findings of Hon'ble Karnataka High Court are reproduced below: XXX 6. In view of above facts and circumstances and judicial precedents, I find merit in the arguments of assessee and therefore, the appeals of assessee are allowed.” (c) ITAT, Delhi in Baldev Singh & Sons Vs. DCIT, ITA No. 3103/Del/2023,
AY 2021-22:
“4. The Ld. AR Submitted that the core issue involved in this appeal was denial of deduction under section 80IB of the Act for the reason that the audit report in Form-10CCB was not filed along with the ITR and was only filed after the receipt of intimation under section 143(1) of the Act. The Ld. AR submitted that auditor of the assessee who was also dealing with tax matters omitted to upload the audit report in Form-10CCB and therefore, the AO-CPC rejected its claim of deduction under section 80IB of the Act and the assessee, on receipt of intimation under section 143(1) of the Act, filed an application under section 154 of the Act after uploading the copy of audit report in Form- 10CCB, which was rejected by the AO-CPC. Further, the appeal filed before the Ld. CIT(A) against the order passed under section 154 of the Act by the AO-CPC also dismissed as above. 4.1 The Ld. AR in this respect submitted that the CBDT, vide Circular Nos. 669 dated 25-10-1993 and Circular No. 689, dated 24.8.1994, had allowed rectification to be carried out under section 154 of the Act in case the evidence of the claim of deduction under section 80HHC of the Act was filed subsequent to the date of furnishing of the ITR for claim. The Ld. AR prayed that the intent of the above-mentioned CBDT Circulars should be followed in the letter and spirit in this case also. The Ld. AR also placed reliance on the decisions of the Hon’ble Madras High Court in the cases of Craftsman Automation P. Ltd. 435 ITR 558 and L-Cube Innovative Solutions P. Ltd. 435 ITR 566 and the decision of the Hon'ble Karnatka High Court in the case of Mandira D Vakharia 250 ITR 432; wherein similar issue in respect of deduction under section 80HHC had been decided in favour of assessees. Further, the Ld. AR, placing reliance on the decision of Tribunal (SMC Bench, Lucknow) in the case of Satish Cold
Page 5 of 9 AY 2023-24 Storage in & 77/Lkw/2021 (date of order: 25.05.2022), submitted that the present case was squarely covered by this decision. Accordingly, in view of these facts, circumstances and judicial pronouncements, he prayed for relief by allowing the claim under section 80IB of the Act particularly when the said deduction had been allowed in preceding years in past by the AO only.
5. On the other hand, the Ld. Sr. DR supported orders of authorities below. He contended that the appeal before the Addl. CIT was against the order passed under section 154 of the Act. Since there was no mistake in the said order as the audit report in Form 10CCB was not available when the AO-CPC passed order under section 143(1) of the Act. Therefore, the Ld. Addl. CIT(A) had rightly dismissed the appeal of the assessee. He prayed for dismissal of this appeal accordingly.
We have heard both parties and have perused the material available on the records. There is no dispute in facts. Undisputedly, the AO-CPC and the Addl. CIT(A) disallowed the deduction under section 80IB of the Act for sole reason that the audit report in Form-10CCB was not filed along with the ITR and was only filed after the receipt of intimation under section 143(1) of the Act. There is no question on the eligibility of the claim of deduction under section 80IB of the Act. It is an undisputed fact that the said deduction under section 80IB of the Act has been allowed over the years in the past. Only a genuine failure of not uploading the audit report in Form-10CCB along with the ITR by the person uploading the ITR is the root cause of the dispute. The Tribunal (SMC Bench, Lucknow) in the case of Satish Cold Storage (supra) has allowed the appeal on the similar issue. The relevant part of the said decision in & 77/Lkw/2021 (date of order: 25.05.2022) reads as under: XXX 7. In view of the foregoing discussion, we are of the considered view that this case is squarely covered by the decision of Tribunal (SMC Bench, Lucknow) in the case of Satish Cold Storage (supra). We therefore, following the reasoning given by the SMC Bench of Lucknow Tribunal in the case of Satish Cold Storage (supra), allow the deduction under section 80IB of the Act. The assessee gets consequential relief on this score.”
Thus, the Ld. AR, referring to above authorities of CBDT Circulars and decided cases, submitted that the AO is wrong in not giving benefit of deduction to assessee when the assessee has already filed Form No. 10CCB and also filed rectification application to AO u/s 154. Ld. AR prayed to allow deduction to assessee.
Page 6 of 9 our attention to following para of same:
5.7 The claim of the appellant is against the facts and evidence on record. The present appeal is filed against the 143(1) order dated 29-01-2024 and on this date the appellant has not filed FORM NO. 10CCB and the action of the CPC is in accordance with law. The CPC has disposed the 154 application of the appellant on 13/06/2024 and on this date Form NO. 10CCB is filed although this is not linked with ITR as the date of filing is not available in the ITR. It is open to the appellant is file separate appeal against the 154 order. The order u/s 143(1) dated 29-01-2024 is infructuous after the 154 order dated 13/06/2024. The question whether the appellant authority has power to waive the delay in filing of Form No. 10CCB is a separate question. The CBDT has power to waive delay u/s 119(2)(b) and in specific cases the power is delegated to PCIT/CCIT. But CBDT has not delegated the power to waive the delay in filing of Form No. 10CCB to any other authority and the appellant is advised to file petition before CBDT to condone the delay in filing of Form No. 10CCB. 5.8 The order u/s 143(1) dated 29-01-2024 is infructuous after the 154 order dated 13/06/2024 and the appeal against the 143(1) order is dismissed as infructuous.
We have considered rival contentions of both sides and perused the orders of lower-authorities as well as the material held on record to which our attention has been drawn. The facts and controversy in present case can be fit in a narrow compass. The chronology of events show that the assessee claimed deduction u/s 80-IB in the return of income filed on 04.10.2023 but did not file Form No. 10CCB required by section 80-IB. Therefore, the AO did not allow deduction in the intimation passed u/s 143(1) on 29.01.2024.
Subsequently on 23.02.2024, the assessee filed Form No. 10CCB and also filed an application u/s 154 to AO seeking rectification of intimation.
However, the AO rejected assessee’s application vide rectification-order dated 13.06.2024 and did not grant deduction. The present appeal before us
Page 7 of 9 order passed by AO u/s 154 dated 13.06.2024. The CIT(A) has dismissed assessee’s first-appeal as infructuous while advising assessee to file appeal against rectification-order passed by AO u/s 154. The assessee has relied upon CBDT Circular No. 669 and 689 (supra) in which the CBDT has enable/empowered the AO to pass rectification-order on merit after considering the evidence (i.e. Form 10CCB in present case) filed by assessee.
Further, in the Judicial Rulings relied by Ld. AR as discussed in earlier para, the appeals were against rectification-orders and the Hon’ble Courts have uphold the proposition that the AO must allow rectification application filed by assessee. Thus, the CBDT Circulars and Judicial Rulings relied by Ld. AR give relief to assessee against the rectification-order passed by AO and not against the original intimation u/s 143(1). In that view of matter, the CIT(A)’s order dismissing the first-appeal filed by assessee against the intimation u/s 143(1) and advising the assessee to file a separate appeal against rectification-order is valid. We agree with the decision taken by CIT(A) and uphold the impugned order. We give liberty to assessee to file appeal against rectification-order passed by AO, if the assessee desires so, and bring the entire material i.e. the CBDT Circulars and the judicial rulings as narrated above to the notice of CIT(A). We also expect the CIT(A) to consider assessee’s application for condonation of delay in such appeal judiciously and holistically to advance the cause of justice.
Order pronounced in open court on 30/06/2025