St. Anne’s School Vs CIT (Exemptions) (Bombay High Court)
Bombay High Court heard the writ petition finally by consent and issued Rule, with respondents waiving service. The petition sought quashing of an order dated 18 June 2025 passed by Respondent No. 1, who had rejected the petitioner’s application for condonation of delay in filing Form No. 10 for Assessment Year 2016-17. The petitioner also sought a direction to condone the delay and allow its claim for accumulation of ₹10,08,118 under section 11(2) of the Income-tax Act, 1961.
The petitioner, a charitable trust, filed its original return of income on 17 October 2016 and a revised return on 16 March 2018. An intimation under section 143(1) was issued on 17 March 2018 denying exemption under section 11 on the ground that Form No. 10 had not been filed before the due date of the original return. The petitioner uploaded Form No. 10 on 24 March 2018.
Subsequently, on 13 March 2020, the petitioner filed a condonation application before Respondent No. 1 under section 119(2)(b), seeking condonation of 523 days’ delay in filing Form No. 10. Respondent No. 1 rejected the request, holding that the petitioner had not shown “reasonable cause” for the delay and had provided no proof to substantiate its assertions.
The Court examined the record and found that before Respondent No. 1, the petitioner had explained the delay by stating that its Chartered Accountant inadvertently failed to file Form No. 10 with the return. However, at that stage, no affidavit of the Chartered Accountant had been submitted. In the writ proceedings, the petitioner produced an affidavit dated 1 August 2025 from the Chartered Accountant, placed at page 172 of the paper book.
The affidavit stated that the trustees had passed a resolution on 29 September 2016 to accumulate ₹10,08,118 and had signed Form No. 10 in paper format. It further stated that while finalising accounts for the year, the Chartered Accountant informed the trustees about the requirement to spend 85% of receipts and the shortfall of ₹10,08,118. The affidavit explained that although the return of income was filed on 17 October 2016, before the due date, the Chartered Accountant inadvertently missed filing Form No. 10 electronically because the electronic submission requirement was a recently introduced mandate.
After considering this affidavit, the Court held that the petitioner-trust would suffer grave hardship if the delay were not condoned and the exemption denied solely due to this inadvertent error. The Court observed that a charitable trust should not be burdened with such liability for a mistake committed by its Chartered Accountant.
On these facts, the Court concluded that the delay deserved to be condoned. Accordingly, it quashed and set aside the impugned order dated 18 June 2025 passed under section 119(2)(b). The Court then expressly condoned the petitioner’s delay in filing Form No. 10.
The Rule was made absolute, and the writ petition was disposed of in these terms.
FULL TEXT OF THE JUDGMENT/ORDER OF BOMBAY HIGH COURT
