Kammavari Snagham (Regd.) Vs DCIT (ITAT Bangalore)
The ruling in brief
The Bangalore Bench of the Income Tax Appellate Tribunal, in Kammavari Snagham (Regd.) v. DCIT (Exemption), declined to accept the contention that the deadline for filing Form 10 could simply be treated as directory. However, it gave the society an opportunity to seek condonation of delay, directing it to approach the CBDT within 90 days from receipt of the order. The benefit of accumulation would depend on condonation being granted.
The dispute concerned ₹4,47,39,679 claimed under Section 11(2) for Assessment Year 2015-16. While the order provides a route for relief, its reasoning raises an important question concerning the assessment year to which the statutory filing deadline applied.
The background: Accumulation denied during processing
The assessee was a society registered under the Karnataka Societies Registration Act. It had obtained registration under Section 12A on 9 October 1990. That registration was subsequently cancelled, but the Tribunal set aside the cancellation and remanded the matter. The CIT(Exemptions) thereafter granted registration on 23 October 2023.
For AY 2015-16, the society filed its return on 29 October 2015, declaring nil income after claiming exemption under Section 11. Its claim for accumulation of ₹4.47 crore under Section 11(2) was denied during processing because Form 10 had not been filed with the return.
