SALT MOVEMENT AREA REVIVAL TRUST ,JOTEGHNASHYAM , DASPUR vs. DY. DIRECTOR , CPC, BANGALURU, CPC, BANGALURU
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Income Tax Appellate Tribunal, “A” BENCH, KOLKATA
Before: Dr. Manish Borad & Shri Sonjoy Sarma
IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, KOLKATA डॉ. मनीष बोरड, लेखा सदस्य एवं श्री संजय सरमा, न्याययक सदस्य के समक्ष Before Dr. Manish Borad, Accountant Member & Shri Sonjoy Sarma, Judicial Member I.T.A. No.317/KOL/2024 Assessment Year: 2022-23
Salt Movement Area Revival Trust ………. Appellant Joteghanashyam Teachers Training College, Joteghanashyam, PO Shyamgunj, PS Daspur, Paschim Medinipur, West Bengal-721153. (PAN: AAPTS3350J) Vs. Dy. Director, CPC, Bengaluru ………… Respondent Appearances by: Shri Indranil Banerjee, FCA appeared for Appellant. Shri Nicholash Murmu, Addl. CIT, DR appeared for Respondent. Date of concluding the hearing : 22.08.2024 Date of pronouncing the order : 30.09.2024 ORDER Per Dr. Manish Borad, Accountant Member: This appeal filed at the instance of the assessee pertaining to the Assessment Year (in short “AY”) 2022-23 is directed against the order passed u/s 250 of the Income Tax Act, 1961 in short the “Act”) by Ld. Commissioner of Income-tax, (Appeals), Addl./JCIT(A)-6, Chennai [in short Ld. “CIT(A)”] dated 14.12.2023 arising out of the intimation u/s. 143(1) of the Act by CPC, Bengaluru dated 31.03.2023.
I.T.A. No. 317/Kol/2024 Salt Movement Area Revival Trust AY : 2022-23
Grounds of appeal raised by the assessee read as under: “1. That on the facts and circumstances of the case and in law, the Ld. Appellate Authority should not have arbitrarily subjected the Appeal to partial relief to the extent of Rs.11168586.00, while based on the proven facts and the law applicable, in the absence of any lapse or default as regards filing of the Audit Report within the time limit , the Appellant would have been legally entitled to full relief, claimed in the Audit Reports ofRs.14449989.00, u/s 10(23C)(vi). 2. That on the facts and circumstances of the case and in law, the Ld. Appellate Authority fallaciously taking the view of non-furnishing of the Audit Report in Form 10BB before the Specified Date, could have easily noticed from the Income Tax Portal and also the evidence adduced. during the Appeal Hearing, that an Audit Report containing identical information had been duly furnished in the parallel cum analogous Form 10B ,well ahead of the Specified date, prescribed in this behalf, which had been only and duly substituted by the correct Audit Report in form 10BB , subsequently. 3. That on the facts and circumstances of the case and in law, the Ld. Appellate Authority, while sustaining the belief and conclusion of delayed filing of Audit Report, ought to have taken due cognizance of the distinction between the filing of the same, albeit in the wrong form, before the specified date and the subsequent rectification thereof subsequently, and the belated filing of the same, and as such not misconstrued the former as an act of default. 4. That on the facts and circumstances of the case and in law, the lapse arising from the default committed by the Auditor, in uploading the right Form of Audit Report and instead, furnishing the same Information and particulars through a parallel cum analogous form and thereafter, correcting the same by uploading the right form, merely constitutes a technical and condonable fault of minor nature for which the denial of deduction, otherwise admissible, would be grossly unjust and unreasonable. 5. That on the facts and circumstances of the case and in law, the Ld. Appellate Authority should have appreciated that in view of timely filing of original Audit Report in the wrong form of 10B well before the specified date and the substitution thereof by Form 10BB, well before the return processing U/S 143(1), U/S 10(23C)(vi), the entire income ofRs.14449989.00 had been eligible for deduction and as such he had erred in restricting the deduction to the extent of expenditure debited in the Income and Expenditure Account Rs.1168586.00 only. 6. That the Appellant humbly pleads for going for additional grounds, effecting modification in regard to any one or more o the foregoing
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I.T.A. No. 317/Kol/2024 Salt Movement Area Revival Trust AY : 2022-23 grounds, and also not press any one or more grounds, either before or in course of Appellate Proceeding.”
Brief facts of the case are that the assessee is a public trust which runs teachers’ training college and is duly accredited as an Educational Institution u/s. 10(23C)(vi) of the Act. As per Rule 16CC of Income Tax Rules, 1962 read with 10th proviso to section 10(23C)(vi) it is obligatory to file audit report in prescribed form 10BB before the specified date i.e. 30.09.2022 (further extended up to 07.10.2022). However, the auditor instead of filing audit report in Form No. 10BB on 10.09.2022 inadvertently filed Form 10B which is prescribed for the charitable institution. Subsequently, on noticing the error the correct Form 10BB was uploaded on 28.02.2023. However, CPC vide its order dated 31.03.2023 u/s. 143(1)(a) of the Act did not allow the exemption claimed by the assessee u/s. 10(23C)(vi) of the Act solely on account of delay in filing Form 10BB. 4. Aggrieved, assessee preferred appeal before the Ld. CIT(A) but partly succeeded as Ld. CIT(A) upheld the denial of exemption u/s. 10(23C)(vi) of the Act but allowed the ground of the assessee claiming alternatively that only the net income lie after deduction of expenditure incurred should have been added in place of the gross receipt added by the Ld. AO. Aggrieved, assessee is now in appeal before this Tribunal. 5. Ld. Counsel for the assessee reiterated the submission as submitted before the Ld. CIT(A).
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I.T.A. No. 317/Kol/2024 Salt Movement Area Revival Trust AY : 2022-23 6. On the other hand, Ld. DR vehemently argued supporting the orders of the lower authorities. 7. We have heard rival submissions and perused the material placed before us. The grievance of the assessee is that Ld. CIT(A) erred in confirming the action of the CPC denying exemption u/s. 10(23C)(vi) of the Act on the ground that assessee has not furnished the audit report on the prescribed Form before specified due date. We find that the prescribed date for the assessee for filing audit report on Form 10BB is 30.09.2022 but the same was extended up to 07.10.2022. The audit report on Form 10BB is to be filed by the auditor. In the instant case, the auditor of the assessee trust after having audited the financial statement prepared the audit report but in place of Form 10BB inadvertently furnished the information on Form 10B and uploaded it on 10.09.2022. It thus, means that the audit report though on wrong Form, has been filed by the auditor before the specified due date. Further, we observe that the auditor on realising the mistake uploaded the correct Form 10BB on 20.02.2023. 8. We thus find that in the instant case first of all the auditor of the assessee trust has duly carried out the audit work and prepared the audited financial statement and filed the audit report on Form 10BB before the prescribed due date. Secondly, the correct audit report has also been furnished prior to the order of CPC. We also find that in the CPC order there is only mention about the Form 10B and not the Form 10BB which was subsequently filed. Even Ld. CIT(A) who was provided with all the
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I.T.A. No. 317/Kol/2024 Salt Movement Area Revival Trust AY : 2022-23 information has not taken the cognizance of the fact that for the inadvertent mistake of the auditor in filing wrong Form assessee should not have been subjected to the huge additions. Therefore, under the given facts and circumstances of the case, as filing of the audit report is directory in nature and the said formality has duly been completed, we, therefore, fail to find any merit in the finding of the Ld. CIT(A) denying claim of exemptions u/s 10(23C)(vi) of the Act and the same is hereby reversed. The jurisdictional AO is directed to grant the exemption claimed by the assessee u/s. 10(23C)(vi) of the Act in accordance with law. In the result, the appeal of the assessee is allowed as per 9. terms indicated hereinabove. Order is pronounced in the open court on 30th September, 2024. Sd/- Sd/- (Sonjoy Sarma) (Dr. Manish Borad) Judicial Member Accountant Member Dated : 30.09.2024 J.D. Sr. PS. Copy of the order forwarded to: 1. Appellant – Salt Movement Area Revival Trust 2. Respondent – Dy. Director, CPC, Bengaluru 3. CIT(A), NFAC, Delhi 4. CIT- 5. Departmental Representative 6. Guard File. True copy By order
Assistant Registrar ITAT, Kolkata Benches, Kolkata Page 5 of 5
