“Section 119(1)(b)”
The decision most relied on for Section 119(1)(b) is CIT v. G.M. Knitting Industries (P.) Ltd. (376 ITR 456), cited in 221 judgments on BharatTax.
Leading authorities on Section 119(1)(b)
The requirement to file a certificate or form (e.g., Form 10CCB, 10-IC) along with the return of income for claiming a deduction (e.g., under sections 80-IB, 115BAA) is directory regarding its timing. Such a deduction is allowable if the requisite form is filed before the final order of assessment, as procedural requirements should not override substantive benefits.
The requirement to file an audit report along with the income tax return, as specified in provisions like Section 80J(6A) or 80-IA(7), is directory and not mandatory. Substantial compliance is achieved if the audit report is submitted at any time before the assessment is framed or completed, and benefits should not be denied merely due to a delay in furnishing it.
Exemption provisions under Chapter III, such as Section 10B(8), must be interpreted strictly, and any claim for such exemptions must be made in the return of income. The principles governing Chapter III (incomes not forming part of total income) differ from those for Chapter VIA (deductions in computing total income).
The requirement to file an audit report along with the return of income under section 80-IA(7) and similar provisions is directory, not mandatory. Such a report suffices if filed at any time before the assessment is framed.
The filing of Form 10B for claiming exemption under sections 11 and 12 is directory, not mandatory. A delay in filing Form 10B can be condoned, and exemption cannot be denied solely on this ground if the assessee satisfies other conditions and shows sufficient cause.
The requirement to file an audit report along with the return of income for claiming specified deductions, such as under Section 80J or 80-IA, is directory and not mandatory. Such an audit report can be filed at any time before the assessment is framed or completed under Section 143(1).
An assessment order becomes erroneous and prejudicial to the revenue under Section 263 if the Assessing Officer fails to conduct a proper inquiry or investigation, even if the return appears prima facie correct. The Income-tax Officer has a duty to investigate and cannot remain passive.
Whether there was sufficient cause for delay in making applications for registration under section 12A and 80G is always a question of fact, and contumacious conduct by the assessee must be established for levying penalty under section 271C for non-deduction of TDS.
