DEPUTY COMMISSIONER OF INCOME TAX, EXEMPTION, BHOPAL, BHOPAL vs. INDUS EDUCATION AND RESEARCH INSTITUTE, RAIPUR
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Income Tax Appellate Tribunal, INDORE BENCH, INDORE
Before: SHRI VIJAY PAL RAO & SHRI B.M. BIYANI
आदेश / O R D E R
Per B.M. Biyani, A.M.:
Feeling aggrieved by appeal-order dated 02.01.2024 passed by learned Commissioner of Income-Tax (Appeals)-Addl/JCIT(A)-12, Mumbai [“CIT(A)”] which in turn arises out of intimation of assessment dated 10.11.2019 passed by CPC, Bangalore [“AO”] u/s 143(1) of Income-tax Act, 1961 [“the Act”] for Assessment-Year [“AY”] 2018-19, the revenue has filed this appeal on following grounds:
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Dy. CIT (Exemption), Bhopal vs. Indus Education and Research Institute, Raipur ITA No. 177/Ind/2024 – AY 2018-19 “1. Whether on the facts and in the circumstances of the case and in law, the Ld. Addl/Jt. CIT(A) has erred in allowing the delayed filing of Audit Report in Form 10B by the assessee when Section 12A(1)(b) of the Income-tax Act, 1961, explicitly directs that the Audit Reports shall be filed along with ITR. In the instant case, the ITR was filed on 28.09.2018 and Form 10B was filed on 29.10.2018. 2. Whether on the facts and in the circumstances of the case and in law, the Ld. Addl/ Jt. CIT(A) has erred in interpreting the timeline extension done by CBDT from 18.10.2018 to 31.10.2018, as even though the dates for filing of ITR and Audit Reports had been extended, the Audit Report was to be filed before or alongwith the ITR as per Section 12A(1)(b) of the Income-tax Act, 1961. 2. The background facts leading to present appeal are such that the
assessee, a charitable institution, filed return of income on 28.09.2018
declaring total income of Rs. Nil after claiming exemption u/s 11. Thereafter,
the assessee filed audit report in Form No. 10B on 05.10.2018. The
assessee’s return was processed by AO vide intimation dated 10.11.2019
u/s 143(1) wherein the exemption claimed by assessee u/s 11 was denied
on account of non-filing of auditor’s report before filing return of income and
accordingly total income was determined at Rs. 21,70,45,973/-. Aggrieved,
the assessee carried matter in first-appeal.
During first-appeal, the CIT(A) passed following order granting relief to
assessee:
“Decision and Reasons – 3. Ground no. 1 & 2 – The sole ground taken by the appellant is that the AO has erred in denying exemption of Rs. 21,70,45,973/- u/s 11 on account of late filing
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Dy. CIT (Exemption), Bhopal vs. Indus Education and Research Institute, Raipur ITA No. 177/Ind/2024 – AY 2018-19
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Dy. CIT (Exemption), Bhopal vs. Indus Education and Research Institute, Raipur ITA No. 177/Ind/2024 – AY 2018-19
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Dy. CIT (Exemption), Bhopal vs. Indus Education and Research Institute, Raipur ITA No. 177/Ind/2024 – AY 2018-19
Aggrieved by order of CIT(A), the revenue has come in this appeal.
We have heard learned Representatives of both sides and carefully
perused the above order passed by CIT(A). We find that the CIT(A) has
granted relief to assessee on following reasonings which is very much valid:
(i) The first reasoning given by CIT(A) in Para No. 3.7 to 3.9 of his order
is such that the audit report in Form No. 10B filed by assessee on
29.10.2018 (correct date is 05.10.2018) was well within extended time as
per Press Release dated 08.10.2018 issued by CBDT. This apart, we may
also mention here that the ITAT, Indore has consistently held in several
decisions that the requirement of filing audit-report alongwith return of
income is one of the conditions for claiming benefit of exemption u/s 11/12
but it is a procedural-cum-directory requirement and even if the report is
subsequently filed to AO, the exemption u/s 11 can’t be denied. Some of the
decisions are:
(a) ITAT, Indore - Indore Contract Bridge Association Vs. CPC, Bangalore in ITA No. 403/Ind/2022 order dated 18.04.2023
(b) ITAT, Indore - Navratna Sukrat Foundation Vs. CPC, Bangalore, ITA No. 390/Ind/2022 dated 21.04.2023
(c) ITAT, Indore - DCIT Vs. Shri Vaishnav Polytechnic College, Indore ITA No. 469/Ind/2018 order dated 06.11.2020
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Dy. CIT (Exemption), Bhopal vs. Indus Education and Research Institute, Raipur ITA No. 177/Ind/2024 – AY 2018-19 (d) ITAT, Jodhpur - ITO, Exemption Ward Vs. Society for Education Conscietisation Awareness & Training, ITA No. 461/Jodh/2018 dated 06.05.2019
(e) ITAT, Ahmedabad - Puravanchal Lokhit Mandal Vs. ITO, Exemption Ward, Vadodara, ITA No. 966/Ahd/2019, dated 30.11.2022
(f) ITAT, Ahmedabad - Hari Gyan Pracharak Trust Vs. DCIT, CPC, Bangalore in ITA No. 245/Ahd/2021 order dated 16.06.2023
(g) Hon’ble Gujrat High Court - Sarvodaya Charitable Trust Vs. ITO, Exemption (2021) 125 taxmann.com 75 (Gujrat)
(h) Hon’ble Gujrat High Court - Indian Panel Board Manufacturer Vs. DCIT Tax Appeal No. 655 of 2022 dated 21.03.2023.
(ii) The second reasoning given by CIT(A) in Para No. 3.10 of his order is
such that after passing intimation u/s 143(1), the department has passed
scrutiny assessment-order u/s 143(3) and the income assessed in scrutiny-
assessment prevails over the income assessed u/s 143(1). We may mention
here that the assessee has filed copy of scrutiny assessment-order dated
26.04.2021 passed by AO u/s 143(3) wherein the AO has himself allowed
exemption u/s 11 claimed by assessee taking into account the very same
Form No. 10B filed by assessee with the only modification that a
disallowance/addition of Rs. 2,68,20,000/- has been made on account of
violation of section 13(3).
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Dy. CIT (Exemption), Bhopal vs. Indus Education and Research Institute, Raipur ITA No. 177/Ind/2024 – AY 2018-19 6. Therefore, we do not find any infirmity or error in the order passed by
CIT(A). Consequently, the same is hereby upheld and the revenue’s appeal is
dismissed being devoid of any merit.
Resultantly, this appeal is dismissed.
Order pronounced in open court on 24.09.2024.
Sd/- sd/- (VIJAY PAL RAO) (B.M. BIYANI) JUDICIAL MEMBER ACCOUNTANT MEMBER Indore िदनांक /Dated : 24.09.2024 CPU/Sr. PS Copies to: (1) The appellant (2) The respondent (3) CIT (4) CIT(A) (5) Departmental Representative (6) Guard File By order UE COPY Assistant Registrar Income Tax Appellate Tribunal Indore Bench, Indore
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