Loading judgment…
No AI summary yet for this case.
Income Tax Appellate Tribunal, “A” BENCH KOLKATA
Appearances by: Assessee represented by : M. Goenka, CA Department represented by : Subhendu Datta, CIT-DR Date of concluding the hearing : August 26, 2024 Date of pronouncing the order : August 27, 2024
ORDER
Per Sonjoy Sarma, Judicial Member:
This appeal filed by 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 the Commissioner of Income Tax (Appeals), Addl/JCIT(A), Prayagraj, dated 07.03.2024 arising out of intimation dated 31.03.2023, passed under Section 143(1) of the Act.
The issue before us is this that the delay in filing the audit report in Form 10B whether can be condoned.
Monipur Leprosy Rehabilitation Centre 3. The brief facts leading to the case is this that the appellant, filed its return of income for 2022-23 on 27.10.2022 showing the gross receipts at Rs. ‘Nil’. The CPC, Bangalore, while, processing the return under Section 143(1) of the Act, assessed the total income to Rs. 70,41,100/- by denying the benefit of section 11 & 12 of the Act in Form 10AB was not filed within the prescribed time limit. Aggrieved with the order passed u/s 143(1), the appellant filed an appeal which was dismissed by the Ld. CIT(A).
At the time of hearing, Ld. AR stated that there is delay of 15 days in filing the appeal before the Tribunal. We after perusing application filed by the assessee, find that there is a reasonable cause for the delay in filing the appeal by the assessee. Considering the same, we therefore, condone such delay in filing the appeal by the assessee.
6. At the time of hearing, the main contention by the Ld. Counsel appearing for the assessee before us is that the filing of Audit Report is a substantive requirement but the mode and stage of filing is a procedural one. Once it is filed under Form 10B and made available with the Assessment Officer before assessment initiates, the purpose is served. In the present case, the appellant/assessee submitted Form 10B on 27.10.2022 while deadline for filing Form 10B was one month prior to the due date for submitting return. The due date of submission of return was 31.10.2022 as in the case of assessee. Therefore, there was delay of 27 days in filing the Form 10B, which can be condoned because it procedural omission on the part of assessee.
In this regard, the Ld. Counsel relied upon the judgment passed by the Hon'ble Gujarat High Court in case of Association of indian Panelboard Manufacturer vs. DCIT in R/Tax Appeal No. 655 of 2022, wherein ratio has been laid down in affirmative, in favour of the assessee. The Ld. DR has not 2 Monipur Leprosy Rehabilitation Centre been able to controvert such submission made by the assessee, neither could place any judgment on this issue passed against the assessee pronounced by any Judicial Forum.
We have carefully considered the order passed by the authorities below and the judgment passed by the Hon'ble Gujarat High Court in case of Association of Indian Panelboard Manufacturer (supra) on the issue involved. While passing order in favour of the assessee, the Hon'ble Gujarat High Court has been pleased to observe as follows: “5.6 The tribunal further committed an error in appreciating the import of Section 119 2(b) of the Act inasmuch as the application contemplated thereunder is only additional remedy for the assessee which could not be said to be compulsorily resorted to by the assessee. The circular No 7/18 dated 20.12.2018 issued under Section 119 of the Act could not be, therefore said to have taken away the appellate remedy. 5.7 The tribunal misdirected itself in yet another way when it observed that The Finance Act. 2015 with effect from 1.4.201 6. that is from assessment year 2016-17 changed the legal position. There is no such change which could be said to have altered the legal position. The only change is with regard to compulsory filing of audit report in Form 108 in electronically form which is made mandatory under Rule 12 (2) of the Income Tax Rules, 1962 but there is no change with regard to the substantive law about filing of audit report as stated above.
The moot aspect thus centres around to the requirement of the availability of the audit report when the assessment was undertaken by the Assessing Officer even though the same may not have been filed along with the return of income. Filing of audit report is held to be substantive requirement but not the mode and stage of filing, which is procedural. Once the audit report in Form 12B is filed to be available with the Assessing Officer, before assessment proceedings take place, the requirement of law is satisfied. In that view, the Income Tax Tribunal was not justified in dismissing the appeal of the assessee. 6.1 The appellant assessee has to be held to be eligible and entitled to exemptions under Section 11(1) and 11(2) of the Act and the alleged ground of non-filing of audit report alongwith return of income which was at the best procedural omission, could never to an impediment in law in claiming the exemption. 6.2 Accordingly the substantial questions of law have to be decided in favour of the appellant.
7. They are accordingly decided. The appeal is allowed."
In view of the ratio laid down by the Hon'ble Gujarath High Court holding that non filing of Audit Report along with return of income is a procedural omission and cannot be an impediment in law in claiming the 3 Monipur Leprosy Rehabilitation Centre exemption, we allow after following the decision of Hon’ble Gujarat High Court as in the case of Association of Indian Panelboard Manufacturer vs. DCIT in R/Tax (supra) this appeal condoning the delay in filing the Audit Report in Form No. 10B by the assessee with a direction to AO to allowthe exemption claimed by the assessee u/s 11 of the Act.
In the result, assessee's appeal is allowed. Kolkata, the 27th August, 2024.