Mina Manoj Agrawal Vs ITO (ITAT Ahmedabad)
Summary: The Income Tax Appellate Tribunal, Ahmedabad SMC Bench, in Mina Manoj Agrawal Vs Income Tax Officer, ITA Nos. 470, 471 and 472/Ahd/2026, decided on 18 September 2026, considered three connected appeals concerning the assessee’s exercise of the option under Section 115BAC of the Income-tax Act, 1961 through Form 10-IE for Assessment Years 2021-22, 2022-23 and 2023-24. The common dispute concerned the consequences of filing Form 10-IE on 15 March 2022, after the due date applicable to Assessment Year 2021-22, and whether that option remained effective for subsequent assessment years.
For Assessment Year 2021-22, the assessee originally filed her return on 31 December 2021 under the old tax regime but subsequently filed a revised return on 15 March 2022 opting for the new tax regime. The Tribunal held that the option had been exercised belatedly and therefore could not be accepted for that assessment year under Section 115BAC(5). However, once the return was assessed under the old tax regime, the assessee was entitled to claim otherwise eligible deductions under Chapter VI-A. The matter was restored to the Assessing Officer for verification and allowance of those deductions in accordance with law.
For Assessment Year 2022-23, the assessee had not filed a fresh Form 10-IE, relying instead on the option submitted on 15 March 2022. The Tribunal examined Section 115BAC(5)(i), which provides that an option exercised by a person having income from business or profession continues for subsequent assessment years. It held that although the option had been too late for Assessment Year 2021-22, it had been filed before the due date relevant to Assessment Year 2022-23 and could operate for that later year. The Assessing Officer was therefore directed to compute the assessee’s income under the new tax regime for Assessment Year 2022-23.
The parties agreed that the issue for Assessment Year 2023-24 was identical to that for Assessment Year 2022-23. The Tribunal accordingly applied the same directions to the third appeal. All three appeals were allowed for statistical purposes, with the first year requiring examination of Chapter VI-A deductions under the old regime and the later two years requiring computation under the new regime.
FULL TEXT OF THE ORDER OF ITAT AHMEDABAD
This batch of three appeals has been filed by the same Assessee against separate orders dated 16.12.2025, 17.12.2025 and 17.12.2025 passed by Commissioner of Income Tax, Appeal ADDL/JCIT(A), Thiruvanantpuram [hereinafter referred to as ‘the CIT(A)’] for the Assessment Years 2021-2022, 2022-2023 and 2023-2024 respectively under Section 250 of the Income Tax Act, 1961 (hereinafter referred to as “the Act”).
2. We have taken these appeals together as these appeals are pertaining to the same Assessee and issues involved are connected through a common string, i.e., filing of Form 10-IE by the Assessee and, therefore, these are heard together and being decided together by way of this common order.
2.1 First, we would take up ITA No. 470/Ahd/2026.
ITA No. 470/Ahd/2026:
2.2 The grounds taken in the present appeal are as under:
“1. The Ld. CIT (A) has erred in law and in fact in upholding the order of the Ld. AO and thereby dismissing the appeal of the appellant.
2. The Ld. AO has erred in law and in fact in not allowing the claim of deductions under Chapter VI-A of the Act.
3. The Appellant reserves the right to add, alter, amend, modify, delete all or any of the grounds of appeal either partially or completely.”
2.3 Ground Nos. 1 and 3 are formal in nature, which require no adjudication. The only grievance raised in Ground No. 2 by the Assessee is that he has not been granted the claim of deduction under Chapter VI-A of the Act.
3. Brief facts of the case are that the Assessee filed her return of income for Assessment Year 2021-22 on 31.12.2021 under the old tax regime. Subsequently, the return was revised by the Assessee on 15.03.2022 and the assessee opted for the new tax regime, and Form No. 10-IE in this regard was filed by the Assessee on 15.03.2022, i.e., after the due date for filing the return u/s 139(1) of the Act. The revised return was processed by the CPC under Old Tax Regime, and a demand of Rs. 3,44,120/- was generated on account of disallowance of credit of prepaid taxes and non-consideration of rates of the new tax regime. Subsequently, CPC suo motu rectified its order and enhanced the demand to Rs. 3,46,730/-. The Assessee filed a rectification application before the learned Assessing Officer (hereinafter referred to as the “AO”) to allow the credit of prepaid taxes.
3.1 The Ld. AO, in the impugned order, treated the Assessee’s claim under the old tax regime and gave the benefit of prepaid taxes, however, no benefit of deductions under Chapter VI-A was granted to her. Aggrieved by the same, the Assessee preferred an appeal before the Ld. CIT(A), which was dismissed by the Ld. CIT(A) vide impugned order dated 16.12.2025.
3.2 Against which the appellant is in appeal before us, and the short issue raised by the Assessee/appellant in the present appeal is the non-allowance of the claim of deduction under Chapter VI-A of the Act while treating the return of the Assessee under the old tax regime.
4. The Ld. AR before us submitted that in case when the AO did not agree with the option exercised by the Assessee for treatment under the new tax regime, it was still incumbent upon the AO to grant Chapter VI-A deduction to the Assessee.
5. The Ld. Sr. DR, on the other hand, supported the orders of the AO and the Ld. CIT(A).
6. We have heard the parties and perused the materials on record. Since the option for the new tax regime for Assessment Year 2021-22 was exercised by the Assessee only with its revised return of income u/s 139(5) of the Act on 15.03.2022, i.e., much after the return dated 31.12.2021 u/s 139(1) of the Act was filed by the Assessee. The belated exercise of option for the new tax regime for a particular Assessment Year disentitles the Assessee’s claim for the new tax regime in terms of Section 115BAC(5) of the Act, and hence, no fault can be found in the action of the AO in treating the return filed by the Assessee under the old tax regime.
7. Having said so, we are of the considered opinion that under the old tax regime, the Assessee is entitled to deductions under Chapter VI-A of the Act. The Assessee had opted for the new tax regime belatedly, which option was not allowed by the authorities in terms of Section 115BAC(5) of the Act and the return filed by the assessee was rightly treated as filed under Old Tax Regime by the authorities. Once the return was treated under Old Tax Regime, the assessee becomes entitled to claim eligible deduction under the provisions of Chapter VI-A of the Act. Hence, Ground No. 2 of the present appeal is, therefore, allowed, and the case of the Assessee is remitted to the file of the Ld. AO for examining and pursuantly allowing the claim of deductions of the Assessee under Chapter VI-A of the Act, if otherwise found eligible to claim these deductions in accordance with law.
8. In the result, the appeal of the Assessee is allowed for statistical purposes.
9. Now, we would take up ITA No. 471/Ahd/2026.
ITA No. 471/Ahd/2026:
10. In this appeal, the Assessee has raised the following grounds:
“1. The Ld. CIT (A) has erred in law and in fact in upholding the order of the Ld. AO and thereby dismissing the appeal of the appellant.
2. The Ld. AO erred in law and in fact in not considering the Form 10-IE filed by the appellant for the previous assessment year.
3. The Ld. AO erred in law and in fact in processing the ITR of the appellant as per the old tax regime and thereby denying the benefit of Section 115BAC of the Act.
4. The Appellant reserves the right to add, alter, amend, modify, delete all or any of the grounds of appeal either partially or completely.”
11. Brief facts of the case are that the present appeal relates to Assessment Year 2022-23, and in this Assessment Year, while filing the return of income, the Assessee did not file Form No. 10-IE along with the return on the pretext that the same was filed by her on 15.03.2022 in the preceding assessment year itself. The CPC processed the return under the old tax regime and raised a demand of Rs. 23,170/-. The sole grievance of assessee in the present appeal is that as the assessee had filed option for New Tax Regime by filling its option in Form 10-IE on 15.03.2022 itself, the return of assessee ought to have been treated under New Tax Regime in terms of Section 115BAC(5) of the Act. The Assessee filed an online rectification request, which was again processed with the same amount of demand.
11.1 Aggrieved thereby, the Assessee preferred an appeal before the Ld. CIT(A).
12. The Ld. CIT(A) held that Form 10-IE had not been filed by the Assessee for the present assessment year 2022-23 before the due date specified u/s 139(1) of the Act, its return was rightly treated under Old Tax Regime. Ld. CIT(A) accordingly held that the order u/s 154 of the Act to be in order, and computation of income in the old tax regime was accordingly upheld by the Ld. CIT(A). Ld. CIT(A) did not considered filing of Form 10-IE by the assessee relevant for exercise of option for the present assessment year 2022-23.
13. We have heard the parties and perused the material on record.
14. The Ld. AR submitted that Form 10-IE was filed by the Assessee on 15.03.2022 itself along with the revised return u/s 139(5) of the Act for Assessment Year 2021-22. He submits that in the scheme of the Act, Form 10-IE is to be filed only once, and once such option is exercised, the same will continue to apply to subsequent years also, therefore, there was no need or obligation on the part of the Assessee to furnish Form 10-IE again, which was otherwise filed by him on 15.03.2022, i.e., on a date prior to the filing of the return u/s 139(1) of the Act for Assessment Year 2022-23.
15. Per contra, the Ld. Sr. DR supported the order passed by the Ld. CIT(A).
16. We find force in the submissions made by the Ld. AR for the Assessee. Section 115BAC(5) of the Act reads as under:
“(5) Nothing contained in this section shall apply unless option is exercised in the prescribed manner by the person,—
(i) having income from business or profession, on or before the due date specified under sub-section (1) of section 139 for furnishing the returns of income for any previous year relevant to the assessment year commencing on or after the 1st day of April, 2021, and such option once exercised shall apply to subsequent assessment years;
(ii) having income other than the income referred to in clause (i), alongwith the return of income to be furnished under sub-section (1) of section 139 for a previous year relevant to the assessment year:
Provided that the option under clause (i), once exercised for any previous year can be withdrawn only once for a previous year other than the year in which it was exercised and thereafter, the person shall never be eligible to exercise option under this section, except where such person ceases to have any income from business or profession in which case, option under clause (ii) shall be available.”
17. In the scheme of the Act, filing Form 10-IE for opting for the new tax regime is required to be done only once in terms of Section 115BAC(5), and once such option is exercised by the Assessee, the same applies to subsequent Assessment Years also in terms of Section 115BAC(5)(i) of the Act. The only condition for a valid filing of Form 10-IE is that it should have been filed on or before the due date of filing the return u/s 139(1) of the Act for the relevant assessment year. The assessee can exercise this option on any date on or before 01.04.2021. If the date of exercise of option falls before due date of filing return u/s 139(1) of the Act, the option so exercised will be valid for the said assessment year, otherwise the option will not be valid for the relevant assessment year in which the assessee has exercised its option. The case of assessee for assessment year 2021-22 in ITA No. 470/Ahd/2026 was exactly falling in this category. Therefore, we have upheld the treatment of assessee’s return under Old Tax Regime by the authorities below. The impugned order passed by ld. CIT(A) itself records that Form 10-IE was filed by the Assessee in the present case on 15.03.2022 and, therefore, the filing of Form 10-IE on 15.03.2022 by the Assessee is not disputed in the present case. The Ld. CIT(A) has disallowed the claim of the new tax regime only on the count that it was not filed before the due date specified u/s 139(1) of the Act for Assessment Year 2022-23. Such a finding of the Ld. CIT(A) is not in consonance with the provisions of Section 115BAC. In our considered opinion, the option exercised by the Assessee by filing of Form 10-IE will remain valid for subsequent years also in terms of Section 115BAC(5)(i) of the Act. We, therefore, are of the considered view that the return filed by the assessee for assessment year 2022-23 ought to have been treated under New Tax Regime in terms of provisions of Section 115 BAC(5) of the Act. Accordingly, the appeal succeeds on this count, and the matter is remanded back to the file of the Ld. AO for computing the income of the Assessee under the new tax regime for the present Assessment Year 2022-23.
18. In the result, the appeal of the Assessee is allowed for statistical purposes in terms of the aforesaid directions.
19. Now, we would take up ITA No. 472/Ahd/2026:
ITA No. 472/Ahd/2026:
20. Both the parties have agreed that the issue involved in the present case, i.e., ITA No. 472/Ahd/2026 for the Assessment Year 2023-24 is identical to that of ITA No. 471/Ahd/2026 for the Assessment Year 2022-23 and, therefore, the result of ITA No. 471/Ahd/2026 will apply mutatis mutandis to the present case, i.e., ITA No. 472/Ahd/2026.
21. In the result, the present appeal is allowed for statistical purposes in terms of directions given by us at Para No. 17 in ITA No. 471/Ahd/2026.
22. In conclusion, all the present captioned appeals filed by the Assessee are allowed for statistical purposes in terms of the aforesaid directions.
The order pronounced on 18.09.2026.
