Loading judgment…
Facts
The assessee filed its return of income for AY 2022-23 on November 5, 2022, declaring a total income of Rs. 12,538 and claiming TDS refund. The CPC processed the return and assessed the total income at Rs. 62,56,517, disallowing an expenditure of Rs. 47,43,979 and adding Rs. 15 lakhs, due to the alleged belated filing of Form No. 10B.
Held
The Tribunal noted that the assessee filed Form No. 10B along with the return of income on November 5, 2022. It also referred to CBDT Circular No. 20/2022 which extended the due date for filing the return of income and Form No. 10B for AY 2022-23 to November 7, 2022. Therefore, the assessee's filing was within the extended due date.
Key Issues
Whether the disallowance of expenditure and addition to income by the CPC was justified on account of the assessee allegedly filing the audit report (Form No. 10B) belatedly, when the filing was within the extended due date as per CBDT circular.
Sections Cited
11(1), 11(2), 12A(1)(b), 119(2), 139(1), 250
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, MUMBAI BENCH “A”, MUMBAI
Before: SHRI AMARJIT SINGH & SHRI SANDEEP SINGH KARHAIL
PER AMARJIT SINGH, ACCOUNTANT MEMBER:
This appeal of the assessee for the assessment year 2022-23 is directed against the order u/s 250 of the Income-tax Act, 1961 dated 19.06.2024 passed by the ld. Commissioner of Income-tax (Appeal), Mysore.
Facts in brief are that the assessee e-filed the return of income for the AY 2022-23 on 5th November, 2022 declaring the St. Anthonys Education Society, Mumbai. A.Y. 20122-23 total income of Rs.12,538/- and claimed TDS refund of Rs.2,888. The CPC has processed the return of income and, vide intimation u/s 143(1) of the Act dated 8th March, 2023, assessed the total income at Rs.62,56,517/- as against the taxable income of Rs.12,538/- shown by the assessee in the return of income. An addition of Rs.62,43,979/- was made by disallowing the entire amount of expenditure claimed as incurred/amount set aside and claimed as deduction u/s 11 of the Act amounting to Rs.47,43,979/- and also by adding Rs.15 lakhs being the amount deemed to have been applied during the previous year as per Clause (2) of Explanation to Section 11(1) of the Act on the ground that the assessee has not e-filed the Form No.10B being the Audit Report u/s 12A(1)(b) of the Act within the due date as specified and raised a tax demand of Rs.22,78,210/- after adjusting TDS refund of Rs.2,888/-.
The ld.CIT(A) has dismissed the appeal of the assessee after referring the Circular issued by the CBDT No.2/2022 dated 3rd January, 2020 stating that for delay in filing Form No.10B, the assessee has to file condonation application u/s 119(2) before the concerned CIT with the reason for belated filing of auditor’s report. The ld. CIT(A) also stated that the condonation application filed by the assessee was before the ld.CIT (E), Mumbai for adjudication, therefore, at this juncture, he cannot intervene in the proceedings of the concerned authority. Therefore, the appeal of the assessee was dismissed.
St. Anthonys Education Society, Mumbai. A.Y. 20122-23 4. Heard both the sides and perused the material on record. The assessee has claimed the tax exemption u/s 11(12) of the Act of Rs.62,43,979/-. However, the claim of exemption has not been considered by the CPC due to belated filing of Form No.10 and the Ld. CIT(A) has also dismissed the appeal of the assessee for the same reason. During the appellate proceedings before us, the ld. Counsel submitted the audit report in Form No.10B had been filed on 5th November, 2022 along with the return of income. The ld. Counsel also submitted that the return of income had been filed within the extended due date as per the CBDT Circular No.20/2022 dated 26th October, 2022 by which the due date stands extended from 31st October, 2022 to 7th November, 2022. In this regard, the assessee has also filed copy of the CBDT Circular No.20/2022 regarding extension of due date for furnishing return of income for AY 2022-23. The relevant extract of the Circular is reproduced as under:-
“In consequence to extension of due date for various reports of audit in the case of assessees referred in clause (a) of Explanation 2 to sub-section (1) of section 139 of the Act to 07th October 2022 by Circular No. 19/2022 dated 30.09.2022, Central Board of Direct Taxes (CBDT), in exercise of its powers under Section 119 of the Income-tax Act,1961 (Act), extends the due date of furnishing of Return of Income under sub-section (1) of section 139 of the Act for the Assessment Year 2022-23, which is 31st October 2022 in the case of assessees referred in clause (a) of Explanation 2 to sub-section (1) of section 139 of the Act, to 07th November, 2022.”
We find that the assessee has also brought this fact before the ld. First Appellate Authority that the CBDT has extended the due date of filing the return of income to 7th November, 2022 and St. Anthonys Education Society, Mumbai. A.Y. 20122-23 the assessee has filed the return of income along with Form No.10B on 5th November, 2022 which was well within the due date. We consider that since the CBDT has extended the date of furnishing of return of income under sub-section (1) of section 139 of the Act for AY 2022-23 from 31st October, 2022 to 07th November, 2022 and the assessee has filed the Form No.10B before the date specified u/s 139 of the Act, therefore, the decision of the First Appellate Authority holding that the assessee has filed the audit report belatedly is not justified. Therefore, we restore this case to the file of the ld.CIT(A) for deciding denovo on merit after considering the Circular No.20/2022 of the CBDT, and submissions and documents filed by the assessee.
In the result, the appeal of the assessee is allowed for statistical purposes only.
Order pronounced in the open court on 17.10.2024.
Sd/- Sd/- (SANDEEP SINGH KARHAIL) (AMARJIT SINGH) JUDICIAL MEMBER ACCOUNTANT MEMBER Mumbai, Dated: 17.10.2024 dk
The Appellant: 2. The Respondent: 3. The CIT, 4. The DR