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Income Tax Appellate Tribunal, NAGPUR BENCH, NAGPUR
Before: SHRI V. DURGA RAO
The present appeal has been filed by the assessee challenging the impugned order dated 31/03/2023, passed by the learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi, [“learned CIT(A)”], for the assessment year 2018–19.
In its appeal, the assessee has raised following grounds:
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1. Whereas in the facts and circumstances, the learned AO & CIT(A) erred in in denying claim of expenditure incurred of Rs.13,94,570 allegedly on the ground that audit report in Form 10B has not been e-filed along with return of income despite the fact that physical copy of Form 10B was issued by Chartered Accountant on 18/09/2018 i.e within specified due date.
2. Whereas in the facts and circumstances, the learned AO & CIT(A) erred in not appreciating that requirement of furnishing the audit report before
Abhijat Multipurpose Society ITA no.158/Nag./2023 specified due date as per section 12A(1)(b), (for the purposes of claim of exemption u/s 11) is directory in nature and not mandatory.
3. Whereas in the facts and circumstances, the learned AO & CIT(A) erred in not appreciating that, non-furnishing audit report in Form 10B electronically before specified due date is a curable defect since, the audit report can be filed before AO or appellate authorities.
4. Without prejudice to the eligibility of claim u/s 11, the learned AO & CIT(A) erred in subjecting gross receipts of Rs.6,95,425 to tax. The learned AO & CIT(A) erred in not providing the deduction for expenditure incurred of Rs. 13,94,570 against the gross receipts. Only net income can be subjected to tax and not the gross receipts.
5. The learned AO erred in levying interest under section 234A, 234B and 234C of the Act.
6. The Appellant prays leave of the Hon'ble Tribunal to add, amend, alter any of the Grounds of Appeal.”
Brief facts of the case are that the assessee is a Trust incurred certain expenses to run the said Trust, which was claimed as exempt under section 11 of the Income Tax Act, 1961 ("the Act"). The Assessing Officer denied the claim of the assessee on the ground that the assessee has not filed Form no.10B, electronically along with the return of income, but it was filed subsequently.
On appeal, the learned CIT(A) confirmed the order passed by the Assessing Officer.
I have heard the arguments of the learned Departmental Representative, perused the material available on record and gone through the orders of the authorities below. The Assessing Officer has not disputed the incurring of the expenditure. The only dispute is that the audit report has not been filed along with the return of income but was filed subsequently. Even the learned CIT(A) has not disputed the incurring of expenditure.
Abhijat Multipurpose Society ITA no.158/Nag./2023 Neither the Assessing Officer nor the learned CIT(A) has expressed any doubt in the genuineness of incurring the expenditure. Under these circumstances, I am of the opinion that the expenditure incurred by the assessee is to be allowed. Consequently, I set aside the impugned order passed by the learned CIT(A) and allow the grounds of appeal raised by the assessee.
In the result, appeal filed by the assessee is allowed. Order pronounced in the open Court on 21/08/2024