MATHA EDUCATIONAL INSTITUTIONS,COCHIN vs. THE ITO,EXEMPTION WARD , KOCHI

It emerges at the outset that the assessee’s sole substantive ground raised in the instant appeal challenges correctness of both the lower authorities’ action disallowing its section 11 exemption claim in section 143(1)(a)(v) processing since not & SA.No.84/Coch/2023 Matha Educational Institutions accompanied by the corresponding tax audit report as prescribed under rule 10B of the Income Tax Rules. There is hardly any dispute between the parties that post facto the CPC’s processing herein dated 26.09.2017, the assessee sought 154 rectification which was filed along with its tax audit report. And that both the lower authorities have not taken into consideration the said tax audit report thereby rejecting the impugned rectification.

We note in this factual backdrop that the question as to whether filing of such a tax audit report is mandatory or directory provision is no more res integra in light of M/s. Social Security Scheme of GICEA vs. CIT(E) [2023] 147 taxmann.com 283 (Guj.) decided the issue in favour of the assessee and against the department thereby concluding that such a compliance could be made even in appellate proceedings as well. We thus accept the assessee’s instant appeal for statistical purposes and direct the learned CIT(A) to examine the assessee’s case on merits after considering its Form 10B tax audit report as per law with three effective opportunities at the risk and responsibility of the taxpayer to plead and prove all the facts in consequential proceedings. Ordered accordingly.