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Facts
The assessee filed an appeal against the order of the CIT(Appeals) which upheld the rejection of exemption under Section 11 of the Income Tax Act. The assessee had inadvertently filed Form 9A instead of Form 10 due to a technical glitch.
Held
The Tribunal held that the non-submission of Form 10 due to a technical glitch was a technical and venial breach, not indicative of mala fide intention. Therefore, the Assessing Officer was directed to consider Form 10 and re-compute the income.
Key Issues
Whether the inadvertent filing of Form 9A instead of Form 10 due to a technical glitch can be a ground for disallowing exemption under Section 11 of the Income Tax Act.
Sections Cited
11, 250
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Income Tax Appellate Tribunal, DELHI BENCH “E” NEW DELHI
Before: SHRI CHALLA NAGENDRA PRASAD & SHRI NAVEEN CHANDRA
आदेश /O R D E R PER SHRI C.N. PRASAD, J.M.
This appeal is filed by the Assessee against the order of the Ld. Addl./JCIT (Appeals), Coimbatore dated 25.03.2025 for the AY 2023-24. In spite of issue of notice none appeared on behalf of assessee nor any adjournment was moved. The appeal is disposed of on hearing the Ld. DR. Assessee in its appeal raised the following grounds: - “1. That the learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Coimbatore has erred both in law and, on facts in upholding the rejection/disallowance of claim by the assessee u/s 11 of the Income Tax Act, 1961 (The Act) amounting to Rs 75,10,000/- (Rupees Seventy Five Lakhs Ten Thousand Only).
2. That the learned Commissioner of Income Tax (Appeals), NFAC, Coimbatore, has erred in law and on facts in not allowing the ground of appeal regarding wrong filing of Form 9A instead of Form 10 due to technical glitch and system problem and that exemption u/s 11 of the Act ought not be rejected.
3. That the learned Commissioner of Income Tax (Appeals), NFAC, Coimbatore, has accepted but failed to appreciate the fact that all the requisite conditions for getting exemption u/s 11 of the Act are being fulfilled and documents were duly submitted along with filing Form 35 by the assessee viz. copy of resolution/minutes of General Body Meeting, bank statement and copy of Fixed Deposit.
4. That the learned Commissioner of Income Tax (Appeals), NFAC, Coimbatore, failed to appreciate that procedural requirements like filing Form 10 should not override the substantive claim of exemption, when the assessee has substantially complied with the requirements.
5. That the learned Commissioner of Income Tax (Appeals), NFAC, Coimbatore, has erred in law and on facts that requirement of filing Form 10 is merely directory in nature and failure to furnish Form 10: cannot be fatal to deny the claim of exemption u/s 11 of the Act.
6. That the learned Commissioner of Income Tax (Appeals), NFAC, Coimbatore has failed to appreciate the facts of the case in the correct prospective rather taking fatal.
7. That the Ld. Commissiner of Income Tax (Appeals), NFAC, Coimbatore without considering the facts concluded that the assessee is not eligible for exemption u/s 11 of the Act,
8. That the learned Commissioner of Income Tax (Appeals), NFAC, Coimbatore went against a settled proposition that it is not open to the CIT(A) to travel outside the record of assessment which had been the subject matter of consideration by the Assessing Officer by quoting in Para 5.6 of its order u/s 250 of the Act, “So, there was a inconsistency in Form 10BB and return of income filed.”
9. That the learned Commissioner of Income Tax (Appeals), NFAC, Coimbatore has erred in considering Form 9A for claiming exemption u/s 11 which is neither the case and nor the assessee has asked for it.
10. That the learned Commissioner of Income Tax (Appeals), NFAC, Coimbatore has erred in understanding the original issue of filing wrong Form due to technical glitches and deviated the issue by finding mistake in Form 9A,Form 10BB & ITR form by giving a new color to the case.
11. That the learned Commissioner of Income Tax (Appeals), NFAC, Coimbatore has also failed to appreciate that the law is well settled that the Assessing Officer is under obligation for guiding the tax payer for claiming any deduction under law, if it is available to him.
12. That the learned Commissioner of Income Tax (Appeals), NFAC, Coimbatore has erred and failed to appreciate that the benefits of deduction/exemption should not be disallowed as the assessee had fulfilled all the conditions for claiming exemption u/s 11 of the Act.
13. That the learned Commissioner of Income Tax (Appeals), NFAC, Coimbatore ought to have decided and allowed appeal in toto by allowing each of the assessee.
14. On the facts and circumstances of the case, the Ld. Commissioner of Income Tax (Appeals), NFAC, Coimbatore is grossly unjustified, illegal & arbitrary in rejection/disallowance of claim u/s 11 of the Act, amounting to Rs.75,10,000/- by stating that Assessee has deliberately not filed Form 10 and has not complied with the provisions of the Act.
That the Assessee should have been careful cannot be doubted, however non submission of Form 10 due the technical glitch in electronically submission of Form 10 on the income tax website in a case such as present does not mean that the assessee is guilty of either furnishing inaccurate particulars or attempting to claim incorrect exemption u/s 11 of the Act and has filed Form 9A instead of Form 10 just for compliance purpose. The intention of the assessee cannot be doubted.
That there is clerical error on the part of the assessee of filing requisite form, which has happened due to technical glitch and are purely unintentional.
That in order to correct its clerical error, the assessee has filed Form 10 on 14th May 2025 vide Acknowledgment No. 966946250140525 for the compliance purposes which shows that there was no mala fide intention of claiming false exemption.
That there is no reason and no mala fide intention for non, compliance of law, there is no undue benefit to the assessee for non compliance of law and there is no loss to the Revenue.
That the action of learned Commissioner of Income Tax (Appeals), NFAC, Coimbatore is illegal, unjustified, arbitrary and against the facts of the case. Relief may please be granted by allowing the exemption u/s 11 of the Act & condonation of delay in filing of Form 10 may be granted.
That the appellant craves leave to add/alter any of the grounds of appeal before or at the time of hearing in the intent of justice.”
It is the contention of the assessee in the grounds of appeal that the assessee while filing the return of income furnished Form 9A instead of Form 10 due to technical glitch and system problem and for this reason the exemption u/s 11 was denied. It is the contention of the assessee that in order to correct its clerical error the assessee filed Form 10 on 14th May, 2025 vide acknowledgment no. 966946250140525 and stated that there was no mala fide intention of claiming false exemption. As the assessee inadvertently uploaded Form 9A instead of 10, we consider it to be a technical and venial breach and therefore we direct the Assessing Officer to consider Form 10 filed by the assessee and re-compute the income accordingly.
In the result, appeal of the Assessee is allowed for statistical purpose.