DESAI INFRA PROJECTS (I) PRIVATE LIMITED,PUNE vs. CIT(A), PUNE-11, PUNE

PER RAMA KANTA PANDA, V.P. :

This appeal filed by the Assessee is directed against

the order dated 14.08.2024 of the learned CIT(A), Pune-11,

Pune relating to assessment year 2022-2023.

company engaged in development of infrastructure project and

filed it’s return of income on 15.10.2022 declaring total income

at Rs.6,41,73,900/-, after claiming deduction of

2 ITA.No.1852/PUN./2024

Rs.3,42,22,700/- u/s.80IA(4)(i) of the Act. The CPC processed

the return and passed an intimation u/s.143(1) determining

the total income at Rs.9,83,96,600/-, by reducing the claim of

deduction u/sec.80IA(4).

2.1. Before the learned CIT(A), it was argued that the

due date for filing the report in Form-10CCB as required by

Sec.801A(7) of the Act was 30.09.2022 which stands extended

to 07.10.2022. However, due to the technical glitches in the

income tax e-filing portal, the assessee could not file the said

Form-10CCB and it was filed on 31.10.2022. It was further

submitted that the tax audit report in Form-3CD was filed on

07.10.2022 and it is within the extended due date. The auditor

of the company had obtained UDIN from ICAI for the purpose

of filing Form-10CCB on 07.10.2022 which is within the

extended due date. However, since the Form-10CCB was not

available in the account of the assessee on the portal and the

same could not be assigned to the auditor, therefore, the

assessee could not file the said Form-10CCB within the

prescribed time limit. It was submitted that after raising

grievances with the department, the said technical glitch was

resolved and the assessee filed Form-10CCB on 31.10.2022.

Relying on various decisions, it was submitted that since

Form-10CCB was filed before the processing of the return, the

CPC was not justified in rejecting the claim of deduction

u/sec.80IA(4) of the Act. It was further submitted that the CPC

3 ITA.No.1852/PUN./2024

does not have power to disallow claim of deduction

u/sec.80IA(4) while processing the return u/sec.143(1) of the

Act.

2.2. However, the Ld. CIT(A) was not satisfied with the

arguments advanced by the assessee. So far as the arguments

advanced by the assessee that Form-10CCB could not be filed

due to technical glitches and was filed before the processing of

the return and therefore, deduction u/sec.80IA(4) could not

have been disallowed by the CPC is concerned, the Ld. CIT(A)

dismissed the same by observing as under :

“Findings :

submissions made by the appellant. It is not under dispute

that the due date for filing Form 10CCB was 07.10.2022

and the appellant did not file the said Form 10CCB within

this prescribed time and could file the Form 10CCB only on

31.10.2022. In this connection, it is important to note that

Form 801A(7) of the Act reads as under :-

(7) The deduction under sub-section (1) from profits

and gains derived from an undertaking shall not be

admissible unless the accounts of the undertaking for

the previous year relevant to the assessment year for

which the deduction is claimed have been audited by

an accountant, as defined in the Explanation below

4 ITA.No.1852/PUN./2024

sub-section (2) of section 288, before the specified

date referred to in section 44AB and the assessee

furnishes by that date the report of such audit in the

prescribed Form duly signed and verified by such

accountant.

specified date referred to in section 44AB and the

assessee furnishes by that date' was introduced vide

Finance Act, 2020 w.e.f. 01.04.2020, i.e. AY 2020-21.

Therefore, as per sub-section (7) of section 801A, for AY

2020-21 onwards, no assessee shall be eligible to claim

deduction u/s.801A unless Form 10CCB is filed before the

specified date. With this amendment, vide Finance Act,

2020, filing of Form 10CCB within the prescribed time limit

has been made mandatory because before the said

amendment, the Form 10CCB was required to be filed

along with the return of income. Thus, no time limit for

filing Form 10CCB was prescribed for the assessment

years prior to AY 2020-21.

is mandatory to obtain UDIN for practicing Chartered

Accountants for all reports issued under the Income Tax

Act, 1961 from the ICAI and as per the appellant, the UDIN

5 ITA.No.1852/PUN./2024

for issuing Form 10CCB was obtained at 23:12:29 on

07.10.2022, i.e. just 48 minutes before the limitation time.

3CD filed by the appellant that the said tax audit report

was completed at 11:52:03 PM on 07.10.2022, i.e. just 8

minutes before the limitation time. Since the Form 10CCB

can be issued by the Chartered Accountant only after the

completion of Tax Audit Report, thus less than 8 minutes

were left with the Chartered Accountant to complete the

Form 10CCB and to upload the same. These facts clearly

suggest that the Chartered Accountant of the Appellant

was trying to complete the task at the very last moment.

the assessee is required to assign the said functionality to

his CA by using the 'My CA functionality and unless the

said task is assigned to the CA, Form 10CCB cannot be

filed by the Chartered Accountant. Apparently, in the

present case, since the Chartered Accountant completed

the Tax Audit Report at the last moment, therefore, he did

not have sufficient time for assigning the task of

completing the Form 10CCB by using the functionality 'My

CA' and uploading the Form 10CCB within a time of 8

minutes. These timelines clearly suggest that there was no

technical glitch in the e-filing portal and the non-filing of

6 ITA.No.1852/PUN./2024

Form 10CCB by the due date is solely for the delay on the

part of the appellant and its Chartered Accountant.

Supreme Court in the case of GM Knitting Industries Pvt.

Ltd. (Supra), however it is seen that the said decision does

not deal with the deduction u/s. 801A(4) of the Act. Similar

are the facts for the decision of Hon'ble Bombay High

Court in the case of CIT vs. Shivanand Electronics (Supra)

as well as CIT vs. Contimeters Electricals Pvt. Ltd. (Delhi

HC). As far as the decisions of Hon'ble Tribunal of Delhi

Bench and Bangalore Bench are concerned, same pertains

to assessment years prior to AY 2020-21. As discussed

above, from AY 2020-21 onwards, it has been made

mandatory to file Form 10CCB within the prescribed time

limit and as provided u/s.801A(7), no deduction shall be

allowed if the Form 10CCB is not filed within the

prescribed time limit. In view of these facts, the case laws

relied upon by the appellant shall not be applicable to the

facts of the present case.

case and the above discussion, I am of the considered

opinion that since the appellant did not file the Form

10CCB within the prescribed time and the delay in filing

the Form 10CCB is on the part of the appellant and his

Chartered Accountant, the CPC was correct in denying the

7 ITA.No.1852/PUN./2024

deduction u/s.801A(4) of the Act. The ground no. 1, 4 and

5 raised by the appellant are DISMISSED.”

2.3. So far as the argument of the assessee that the CPC

does not have jurisdiction to disallow the claim of deduction

u/sec.80IA(4) while processing the return u/sec.143(1) is

concerned, the learned CIT(A) also dismissed the same by

observing as under :

“14. I have considered the facts of the case and the

submission made by the appellant. As per section

143(1)(a)(ii) of the Act, the adjustment on account of an

incorrect claim, if the same is apparent can be made while

processing the return of income. In the present case,

undisputedly, the mandatory Form 10CCB was not filed

within the prescribed time and therefore as per the

provisions of section 801A(7), the appellant was not

eligible for deduction u/s.801A(4) of the Act. Since Form

10CCB was not filed within time, therefore this situation is

covered by Explanation (a)(ii) to section 143(1)(a) of the Act.

Therefore, the adjustment made by the CPC falls within

the provisions of section 143(1)(a) of the Act. Accordingly,

the grounds no. 2 and 3 raised by the appellant does not

have any merits and are DISMISSED.”

8 ITA.No.1852/PUN./2024

assessee is in appeal before the Tribunal by raising the

following grounds :

1) “The learned CIT(A) erred in confirming the disallowance of

Rs.3,42,22,700/- u/s 801A(4) (i) on the ground that there

was a delay in filing Form No.10CCB on the part of the

appellant and his Chartered Accountant.

2) The learned CIT(A) erred in holding that the learned CPC

was justified in denying the claim of deduction u/s

801A(4)(i) in the intimation order passed u/s.143(1) on the

ground that there was a delay in filing Form 10CCB on the

part of the assessee.

3) The learned CIT(A) further erred in holding that the CPC

was justified in disallowing the claim of deduction u/s

801A(4)(i) on account of delay in filing 10CCB in the

intimation order passed u/s. 143(1) and the situation was

covered by explanation (a)(ii) to section 143(1)(a).

4) The learned CIT(A) erred in not appreciating that the CPC

had no jurisdiction to deny the claim of deduction u/s

80IA(4)(i) in the intimation u/s 143(1) on the ground that

there was a delay in filing the audit report in Form 10CCB

and hence, the disallowance made of the deduction u/s

80IA(4)(i) is not justified at all.

5) The learned CIT(A) erred in holding that the disallowance

of claim of u/s 80IA(4)(i) could be made in view of

9 ITA.No.1852/PUN./2024

explanation (a)(ii) to section 143(1)(a) without appreciating

that the said provision was not applicable to the facts of

the present case and hence, the disallowance made of the

deduction u/s 80IA(4)(i) may kindly be deleted.

6) The learned CIT(A) erred in not appreciating that the

disallowance of deduction u/s 80IA(4)(i) on account of

delay in filing the audit report was not covered by any of

the sub clauses (i) to (vi) of clause (a) of section 143(1) and

the disallowance made of the deduction claim u/s

80IA(4)(i) was not justified and the same may kindly be

deleted.

7) The ld. CIT(A) further erred in holding there was no

technical glitch on the filing of Form 10CCB and the delay

in filing of the same was solely on the part of the assessee

and its Chartered Accountant without appreciating the

correct facts of the case.

8) The ld. CIT(A) erred in attributing the delay in filing Form

10CCB to the assessee and its Chartered Accountant

without appreciating that due to technical glitches, the

said Form could not be filed within the specified time and

hence, there was no reason to disallow the claim of

deduction u/s. 801A(4)(i). 9) The ld. CIT(A) failed to appreciate that the Form 10CCB

was filed by the assessee before the passing of intimation

order u/s.143(1) and hence, as the said Form was

10 ITA.No.1852/PUN./2024

available on record, there was no reason to deny the

deduction claimed u/s. 801A(4)(i).

10) The appellant craves leave to add, alter, amend or delete

any of the above grounds of appeal.”

reiterated the same arguments as made before the Ld. CIT(A).

He submitted that the CPC has no power to disallow the claim

made u/sec.80IA(4) of the Act in Form-10CCB. Further due to

technical glitches the assessee could not upload the Form-

10CCB before the extended due date i.e., on 07.10.2022 and

the same was uploaded only on 31.10.2022 after the technical

glitch was resolved. Learned Counsel for the Assessee referring

to page-47 of the paper book drew the attention of the Bench

to the screen-shot taken on 08.10.2022. Referring to page-49

of the paper book, he drew the attention of the Bench the

grievance description which reads as under :

“Form No.10CCB Audit Report under section 80-IA(7) is not

available on the portal and hence could not be uploaded

within extended due date. Attaching herewith the

screenshot of CA unable to file the Audit Report under

section 80-IA(7) and the screenshot of portal not showing

the Form in assigning to CA.”

11 ITA.No.1852/PUN./2024

4.1. Referring to the order of the Ld. CIT(A), he

submitted that although all these things were pointed-out

before the Ld. CIT(A), however, he has not discussed anything

about the glitches which prevented the assessee from filing

Form-10CCB. Without prejudice to the above, he submitted

that because of the technical glitches the assessee could not

file Form-10CCB and the department does not say that the

assessee is incorrect. Therefore, because of the technical glitch

on the part of the department, the assessee should not have

been denied the benefit of deduction u/sec.80IA(4) of the Act.

He drew the attention of the Bench the provisions of

sec.80IA(7) which reads as under :

“(7) [The deduction] under sub-section (1) from

profits and gains derived from an [undertaking] shall not

be admissible unless the accounts of the [undertaking] for

the previous year relevant to the assessment year for

which the deduction is claimed have been audited by an

accountant, as defined in the Explanation below sub-

section (2) of section 288, [before the specified date

referred to in section 44AB and the assessee furnishes, by

that date] the report of such audit in the prescribed Form

duly signed and verified by such accountant.”

4.2. He submitted that the above provision was amended

by the Finance Act 2020 w.e.f. 01.04.2020 and the words

12 ITA.No.1852/PUN./2024

“before the specified date” referred to in sub-sec.44AB and the

assessee furnishes by that date the report of the said audit in

the prescribed Form was substituted for the words “and the

assessee furnishes along with his return of income”. He

submitted that in view of the above, the assessee was not

mandatorily required to submit the audit report in Form-

10CCB along with return of income and he can always file the

return before the specified date. In any case, he submitted

that filing of the audit report is directory and not mandatory

and it can be furnished at any time even before the

assessment is completed.

4.3. Referring to the decision of Hon’ble Kolkata Bench

of the Tribunal in the case of Tarasafe International (P.) Ltd.,

vs. DDIT, CPC reported in [2024] 168 taxmann.com 514

[Kolkata-Trib.], he submitted that the Tribunal in the said

decision has held that where assessee claimed deduction

under section 80JJAA but had not filed audit report in Form

10DA along with return of income, however, filed the same

before final order of assessment was made, assessee was

entitled to claim deduction under section 80JJAA. He

submitted that the above decision was passed after

considering the decision of Hon’ble Supreme Court in the case

of Pr. CIT vs. Wipro Ltd., [2022] 446 ITR 1 (SC).

13 ITA.No.1852/PUN./2024

4.4. Referring to the decision of Chennai Bench of the

Tribunal in the case of Natesan Precision Components Private

Ltd., Chennai vs., DCIT in ITA.No.1397/Chny/2024, order

dated 09.08.2024 for the assessment year 2018-2019, the

Learned Counsel for the Assessee submitted that the Tribunal

in the said decision has held that a claim of deduction

u/sec.80IA(4) cannot be denied merely because the audit

report in Form-10CCB was filed belatedly i.e., not along with

the return of income.

4.5. He accordingly submitted that since the assessee

has filed the audit report before the assessment was completed

and it is evident from the record that the audit report could

not be filed before the specified due date due to technical

glitches in the portal of the department and it was beyond the

control of the assessee and since the CPC does not have power

to deny claim of deduction u/sec.80IA(4) while processing

return u/sec.143(1) of the Act, therefore, the Ld. CIT(A) was

not justified in rejecting the claim of deduction u/sec.80IA(4)

of the Act.

order of the Ld. CIT(A) and submitted that CPC is well within

the power to deny the claim of deduction u/sec.80IA(4), if the

assessee is otherwise ineligible due to non-filing of the

prescribed audit report in Form-10CCB as per law. He

14 ITA.No.1852/PUN./2024

accordingly submitted that grounds raised by the assessee

should be dismissed.

sides and perused the material available on record. We find

the assessee in it’s return of income had claimed deduction of

Rs.3,42,22,760/- u/sec.80IA(4)(i) of the Act, which was denied

by the CPC in the intimation passed u/sec.143(1) of the Act.

We find the Ld. CIT(A) rejected the arguments advanced by the

assessee and dismissed the appeal, the reasons of which, have

already reproduced in the preceding paragraphs. It is the

submission of the Learned Counsel for the Assessee that the

CPC does not have any power to deny the claim of deduction

u/sec.80IA(4) while processing the return u/sec.143(1). It is

also his argument that since the assessee has filed the audit

report before the processing of the return and since filing of

audit report is directory and not mandatory, therefore, the

deduction should not have been denied.

6.1. We find some force in the above arguments of the

Learned Counsel for the Assessee. Admittedly, in the instant

case, the assessee has filed audit report in Form-10CCB on

31.10.2022 and the CPC has processed the return of income

on 16.03.2023. It is also an admitted fact that as per the

intimation u/sec.143(1), the extended due date for filing of the

return for the assessment year 2022-2023 is 07.11.2022.

15 ITA.No.1852/PUN./2024

6.2. We find an identical issue had come-up before the

Chennai Bench of the Tribunal in the case of Natesan

Precision Components Private Limited, Chennai vs. DCIT in

ITA.No.1397/Chny/2024, order dated 09.08.2024 for the

assessment year 2018-2019, wherein it has been held that a

claim of deduction u/sec.80IA(4) cannot be denied merely

because the audit report in Form-10CCB was filed belatedly

i.e., not along with the return of income. The relevant

observations of the Tribunal are as under :

“8. We have heard both the parties and perused

the material available on record. We find that this was the

8th year of claiming deduction u/s.80IA of the Act and in

earlier year assessee was granted such deduction; and in

the relevant AY, the CPC denied the deduction only on the

ground that Audit Report/ Form No.10CCB was belatedly

e-filed i.e, not along with the return of income. On appeal,

the Ld.CIT(A) has confirmed the action of the CPC by

holding that the assessee ought to have filed Form

No.10CCB on the due date, which requirement of law, we

note came w.e.f. 01.04.2020 and is not applicable for AY

2017-18. Having said so, we note that the assessee had

e-filed Form No.10CCB before the CPC had processed the

return of income u/s 143(1) of the Act; and therefore, the

deduction claimed ought to have been allowed as held by

the Hon’ble Supreme Court in the case of GM Knitting

16 ITA.No.1852/PUN./2024

Industries (P.) Ltd., (supra), wherein the Apex Court had an

occasion to examine the action of Bombay High Court

holding that if Form 3AA is filed before the assessment

proceedings culminated, then additional depreciation shall

be allowed and such a claim should not be denied only

because assessee did not furnish Form 3AA along with

return of income. And the Hon’ble Apex Court, affirmed the

action of the Hon’ble High Court of Bombay as well as

tagged along matter wherein Revenue challenged the

action of the Hon’ble Madras High Court in AKS Alloys Pvt.

Ltd (supra) and the Civil Appeal of department was

dismissed, which means the decision of the Hon’ble

Madras High Court has been affirmed by Hon’ble Supreme

Court, and is binding precedent that if assessee had filed

the Form 10CCB before the assessment proceedings

culminate, then the deduction claimed u/s.80IB ought not

to be denied on the reason that assessee did not file Form

10CCB along with Return of Income (RoI). We also note the

Hon’ble Supreme Court’s decision in M/s.Wipro Ltd.

(supra) was in the context of that assessee’s [Wipro] claim

of exemption under Chapter III, in contra-distinction to the

claim raised by the present assessee under Chapter VI-A.

And it would be gainful to reproduce the Hon’ble Supreme

Court’s observation in M/s.Wipro Ltd., wherein in the

distinction in the claim made for exemption under Chapter-

17 ITA.No.1852/PUN./2024

III and deduction claimed under Chapter VI was noted as

under :

“11. Now so far as the reliance placed upon the

decision of this Court in the case of G.M. Knitting

Industries Pvt. Ltd. (supra), relied upon by the

learned counsel appearing on behalf of the assessee

is concerned, Section 10B (8) is an exemption

provision which cannot be compared with claiming

an additional depreciation under section 32(1) (ii-a) of

the Act. As per the settled position of law, an

assessee claiming exemption has to strictly and

literally comply with the exemption provisions.

Therefore, the said decision shall not be applicable to

the facts of the case on hand, while considering the

exemption provisions. Even otherwise, Chapter III

and Chapter VIA of the Act operate in different

realms and principles of Chapter III, which deals

with "incomes which do not Form a part of total

income", cannot be equated with mechanism

provided for deductions in Chapter VIA, which deals

with "deductions to made in computing total income".

Therefore, none of the decisions which are relied

upon on behalf of the assessee on interpretation of

Chapter VIA shall be applicable while considering the

18 ITA.No.1852/PUN./2024

claim under Section 10B (8) of the IT Act.[emphasis

given by us]”

assessee had e-filed the audit report in Form 10CCB on

30.03.2019 and processing by CPC u/s.143(1) of the Act

took place only on 12.01.2020, which is an event much

after the assessee had e-filed the Form 10CCB, therefore,

the claim of deduction ought to have been granted

especially when assessee was granted such a deduction

for the earlier 5 years. Therefore, we set-aside the

impugned order of Ld.CIT(A)/JCIT(A) and direct the AO to

allow the claim of deduction u/s.80IA of the Act.

allowed.”

6.3. We find the Kolkata Bench of the Tribunal in the

case of Tarasafe International (P.) Ltd., vs. DDIT, CPC (supra)

after considering the decision of the Hon’ble Supreme Court in

the case of Pr. CIT vs. Wipro Ltd., (supra), has held that when

the audit report is filed before the final order of assessment,

the assessee was entitled to claim deduction under section

80JJAA. The relevant observations of the Kolkata Bench of the

Tribunal from para-2 onwards read as under :

“2. The short issue involved in this appeal is as to

whether the late filing of audit report in Form 10DA would

19 ITA.No.1852/PUN./2024

disentitle the assessee from claiming deduction

u/s.80JJAA of the Act, when the said Form 100A was

available to the Ld. AO at the time of assessment

proceedings. The assessee in this case filed the Form

100A on 27.10.2023 as against the due date of

30.09.2023 but, the same was available to the AO at the

time of processing the return of income as the notice u/s.

143(1)(a) of the Act was issued by the CPC to the assessee

on 23.11.2023.

Hon'ble Supreme Court in the case of CIT V. G. M Knitting

bahotries (P) Ltd. (2016/12 SCC 272/[2016] 71

taxmann.com 35/376 ITR 456 (SC), wherein the Hon'ble

Supreme Court has held that, even though it is necessary

to file certificate in Form 10CCB along with the return of

income, but even if the same has not been filed with the

return of income, but the same was filed before the final

order of assessment was made, the assessee was entitled

to claim deduction u/s. 80-IB of the Act.

decision of the Hon'ble Supreme Court in the case of CIT v.

Wipro Lid 120221 140 taxmann.com 223/288 Tasman

491/446 ITR I (SC) is concerned, it is to be observed that

the said case is relating to the claim of exemption u's. 10B

20 ITA.No.1852/PUN./2024

falling under Chapter III of the I.T. Act. However, the claim

of the assessee in the case in hand is u/s. 80JJAA of the

Act under Chapter VIA of the Act. The Hon'ble Supreme

Court in para 11 of the judgment in the case of Wipro Lid

(supra) has clarified the position that the exemption

provisions are to be strictly adhered to whereas the

decision of the Hon'ble Supreme Court in the case of G. M.

Knitting Industries Pvt. Ltd. (supra) is relating to deduction

provisions u/s.VA of the Act the relevant para 11 of the

order of the Hon'ble Supreme Court in the case of Wipro

Lad. (supra) is reproduced below :

"11. Now so far as the reliance placed upon the

decision of this court in the case of G. M. Knitting

Industries Pvt. Ltd. (supra), relied upon by the

learned counsel appearing on behalf of the assessee

is concerned, section 108(8) is an exemption

provision which cannot be compared with claiming

an additional depreciation under section 32(1)(ii-a) of

the Act. As per the settled position of law, an

assessee claiming exemption has to strictly and

literally comply with the exemption provisions.

Therefore, the said decision shall not be applicable to

the facts of the case on hand, while considering the

exemption provisions. Even otherwise, Chapter III

and Chapter VIA of the Act operate in different

21 ITA.No.1852/PUN./2024

realms and principles of Chapter III, which deals

with "income which do not Form a part of total

income", cannot be equated with mechanism

provided for deductions in Chapter VIA, which deals

with "deductions to be made in computing total

income". Therefore, none of the decisions which are

relied upon on behalf of the assessee on

interpretation of Chapter VIA shall be applicable

while considering the claim under section 10B(8) of

the I.T. Act."

In view of this, the issue is squarely covered in

favour of the assessee by the decision of the Hon'ble

Supreme Court in the case of G. M. Knitting Industries Pvt.

Ltd. (supra) the impugned order of the Ld. CIT(A) is,

therefore, set aside and the AO is directed to grant

deduction to the assessee u/s. 80JJAA of the Act as

claimed. The appeal of the assessee stands allowed.

allowed.”

6.4. Since the assessee in the instant case has

admittedly filed the audit report in Form-10CCB prior to the

processing of the return, therefore, respectfully following the

decisions cited (supra), we are of the considered opinion that

assessee cannot be denied deduction u/sec.80IA(4) of the Act.

22 ITA.No.1852/PUN./2024

Accordingly, the order of the Ld. CIT(A) is reversed and the

grounds raised by the assessee are allowed.

Order pronounced in the open Court on 30.12.2024.

Sd/- Sd/- [MS. ASTHA CHANDRA] [RAMA KANTA PANDA] JUDICIAL MEMBER VICE PRESIDENT

Pune, Dated 30th December, 2024

VBP/-

Copy to 1. The appellant 2. The respondent 3. The CIT(A), Pune-11, Pune. 4. The Pr. CIT (Central), Pune. 5. D.R. ITAT, “A” Bench, Pune. 6. Guard File.

//By Order//

//True Copy //

Sr. Private Secretary, ITAT, Pune Benches, Pune.