Electronics & Quality Development Centre Vs DCIT (Exemption) (ITAT Ahmedabad)
The appeal before the Income Tax Appellate Tribunal, Ahmedabad concerned denial of exemption under section 11 of the Income-tax Act, 1961 for Assessment Year 2022–23 solely on the ground of belated filing of audit report in Form No. 10B. The assessee had originally filed its return of income declaring nil income on 07.11.2022 and subsequently filed a revised return on 31.12.2022, again declaring nil income after claiming exemption under section 11. Along with the revised return, the assessee electronically filed the audit report in Form No. 10B.
While processing the revised return under section 143(1), the Centralised Processing Centre assessed total income at ₹10,04,64,687 and raised a demand of ₹7,87,93,310 by denying the section 11 exemption. The denial was based entirely on the ground that Form No. 10B had not been filed within the prescribed time, despite the fact that it was available on record when the intimation under section 143(1) was issued.
On appeal, the Commissioner of Income-tax (Appeals) noted the existence of CBDT Circular No. 16/2024 dated 18.11.2024, which provides for condonation of delay in filing Forms No. 9A, 10, 10B and 10BB. Relying on the circular, the CIT(A) held that exemption under section 11 could be allowed only after condonation of delay by the competent authority under section 119(2)(b). Instead of deciding the issue on merits, the CIT(A) restored the matter to the Assessing Officer for verification of whether the assessee had applied for condonation of delay, thereby granting only partial and statistical relief.
