Saraswati Bal Kalyan Nyas Vs ITO (Exemption) (ITAT Indore)
The appeal before the Income Tax Appellate Tribunal (ITAT), Indore, arose from an order of the CIT(A)-II, Indore dated 15 February 2018 for Assessment Year 2014-15. The assessee, a society registered under Section 12AA of the Income Tax Act, challenged the rejection of its rectification application and the denial of exemption benefits under Sections 11 and 12.
The assessee had filed its e-return on 13 November 2014 declaring nil income. The return was processed under Section 143(1) by the Central Processing Centre (CPC) on 28 February 2016, resulting in a demand of ₹11,54,915 on a total income of ₹59,07,380. Subsequently, the assessee filed an application under Section 154 seeking rectification of the intimation. It contended that it had filed Form No. 10 for accumulation or setting apart of income amounting to ₹1,25,00,000, but the same had not been considered by the CPC. The assessee also furnished Form No. 10B, Form No. 10, and other supporting documents before the Assessing Officer. However, the rectification application was rejected, and the CIT(A) also upheld the rejection.
Before the Tribunal, the assessee argued that the authorities had failed to properly appreciate the facts and had ignored Form No. 10 and other documents. It was submitted that judicial precedents permitted consideration of audit reports and prescribed forms even when filed subsequently, provided they were available before completion of assessment. Reliance was placed on decisions of the Calcutta High Court, Punjab & Haryana High Court, and Delhi High Court. The assessee also referred to CBDT Instruction dated 9 February 1978, which states that exemption under Sections 11 and 12 should not be denied merely because of delay in furnishing the auditor’s report.
