KONTI INFRAPOWER & MULTIVENTURES PVT LTD,MUMBAI vs. ITO 6 (1) (2), MUMBAI

The brief facts of the case are that, the assessee company is engaged in the business. The assessee has filed the return of income for the A.Y 2021-22 on 01.03.2022 disclosing a total income of Rs. Nil after set off of the brought forward losses. The assessee has filed the return of income opting the provisions of section115BAA of the Act and the Form No. 10-IC was not filed along with the return of income. Subsequently, the return of income was processed u/sec 143(1) of the Act determining total income u/sec115JB of the Act at Rs.1,13,72,448/- Vide order dated 13-11-2022.

Aggrieved by the order the assessee has filed an appeal before the CIT(A), whereas the CIT(A) considered the grounds of appeal, submissions of the assessee and findings of the AO and observed that the assessee has not filed the Form No.10-IC before the due date prescribed under the Act and hence not complied with the provisions of section 115BAA of the Act and has dismissed the assessee appeal. Aggrieved by the CIT(A)order, the assessee has filed an appeal before the Hon’ble Tribunal.

At the time of hearing, the Ld. AR submitted that the CIT(A) has erred in not considering the fact that the assessee has filed the return of income as per the provisions u/sec139(1) of the Act within the extended due date time period and entitle to opt for provisions U/sec115BAA of the Act. Subsequently, the assessee has complied with the conditions of CBDT circular dated 23-10-2023 and filed Form No.10-IC on 13-11- 2023. Further the Ld. AR substantiated the submissions with the judicial decisions, CBDT circular, factual paper book and prayed for allowing the appeal. Per Contra, the Ld. DR supported order of the CIT(A).

We heard the rival submissions and perused the material on record. The sole disputed issue envisaged by the Ld.AR that the CIT(A) has erred in dismissing the claim of the assessee opting for the provisions of Sec. 115BBA of the Act. The Ld.AR contentions are that the assessee has filed the return of income for A.Y.2021-22 within the extended due date u/sec 139(1) of the Act on 01.03.2022 as per CBDT press release dated 11-01-2022. Further the Ld. AR has referred to the Form 10-IC filed on 13.11.2023 as per the acknowledgement receipt of Income Tax Forms placed at page 174 to 176 of the paper book. The Ld.AR demonstrated the CBDT circular no 19/2023 dated 23-10-2023 placed at page 172 & 173 of the paper book as under:

Representations have been received by CBDT stating that Form No. 10-IC could not be filed for A.Y2021-22 within the due date or extended due date, as the case may be. It has been requested that the delay in filing of Form No10-IC for A.Y. 2021-22 may be condoned.

On consideration of the matter, with a view to avoid genuine hardship to the domestic companies in exercising the option u/s 115BAA of the Act, CBDT in exercise of the powers conferred under section 119(2)(b) of the Act hereby directs that: -

The principal grievance of the petitioner is, that although in the income tax return, enough and more information had been given, that the petitioner has opted for being taxed at the rate of 22% as provided under Section 115BAA of the Act, the impugned order was passed, only on account of the fact that the petitioner had failed to file Form 10-IC.

It is the submission of Mr Vibhor Garg, who appears on behalf of the petitioner, that before passing the impugned

Mr Zoheb Hosaain, who appears on behalf of the respondent/revenue, on the other hand, says that the provisions of Section 115BAA and Rule 21AE clearly mandate that Form 10-IC should be filed, along with the return.

Perhaps, the issue that requires consideration, is that if every information that is sought for in the form is available with the return, and there is indication in the return, that the assessee has exercised his option in terms of sub- section (1) of Section 115BAA, then, before proceeding further, should the Assessing Officer (AO) not give an

We may note, that when the provision ie, Section 115BAA was inserted, the Central Board of Direct Taxes (CBDT) via circular dated 17-3-2022 had relaxed the rigour of the law, in exercise of its powers under section 119(2)(b) of the Act.

Accordingly, issue notice.

Counter-affidavit will be filed within the next four weeks.

List the matter on 19-5-2023.

In the meanwhile, no precipitate action will be taken against the petitioner in respect of the demand raised via the impugned intimation dated 13-11-2022, till further orders of the Court."

Mr Garg has placed before the court Circular No. 19/2023 dated 23-10-2023 issued by the Central Board of Direct Taxes (CBDT) which, in effect, condones the delay in filing Form 10-1C. In this regard, Mr Garg draws our attention to paragraph 3 of the aforementioned circular, which is extracted hereafter: "3. On consideration of the matter, with a view to avoid genuine hardship to the domestic companies in exercising the option u/s 115BAA of the Act. CBDT in exercise of the powers conferred under section. 119(2)(6) of the Act, hereby directs that: -

We are informed by Mr Garg that in terms of the said circular, a fresh Form 10-IC has been filed, albeit, electronically.

Accordingly. Mr Garg says that the petitioner fulfills the conditions referred to in paragraph 3 of the said circular.

In these circumstances, the writ petition is disposed of, with a direction to the CBDT to process the petitioner's request contained in Form 10-IC. 7. The CBDT will process the aforementioned prescribed form within eight (8) weeks from the date of receipt of the order passed today. 8. The interim order dated 14-12-2022, which was made absolute on 19-5-2023, shall continue to operate pending the aforementioned exercise, and for further three (3) weeks, in case the result is adverse to the interest of the petitioner. 9. Parties will act based on the digitally signed copy of the order.” 7. We considering the facts, circumstances, CBDT circular and ratio of the judicial decision, find that the assessee has complied with the conditions as per CBDT circular discussed above. Whereas the CIT(A) order was passed on 27-07-2023, but the CBDT circular No.19/2023 was issued on 23-10-2023 and the assessee has filed the Form.No. 10-IC on 13.11.2023. And these details of filling of Form.No.10 IC and CBDT circular were not available at the time of processing of return of income U/sec 143(1) of the Act with the Assessing Officer. Accordingly, we set aside the order of the CIT(A) and restore the issues to the file of the assessing officer to verify and examine the

In the result, the appeal filed by the assessee is allowed for statistical purpose.