Introduction: Form 10-IC plays a crucial role for domestic companies opting for taxation under Section 115BAA, which offers a concessional tax rate of 22% under specific conditions. However, filing tax returns and related forms can sometimes be intricate and subject to delays. Recognizing these challenges, the Central Board of Direct Taxes (CBDT) issued Circular 19/2023 on 23rd October 2023, providing relief for the delay in filing Form 10-IC for the assessment year (A.Y.) 2021-22. This relief comes with specific conditions.
Key Conditions for Condonation: To benefit from the condonation of the delay in filing Form No. 10-IC for A.Y. 2021-22, companies must meet the following conditions:
1. Timely Filing of Income Return: The taxpayer must have filed the income return for the relevant assessment year on or before the due date, as specified under section 139(1) of the Income Tax Act. Meeting the primary filing deadline is a fundamental requirement for eligibility.
2. Opting for Taxation under Section 115BAA: The assessee company should have made the choice to opt for taxation under section 115BAA of the Act. This selection should be evident in the “Filing Status” section, particularly in item (e) of “Part A-GEN” of the Form of Return of Income ITR-6. Section 115BAA pertains to the provision that allows domestic companies to pay tax at a reduced rate, subject to specific conditions.
3. Deadline for Filing Form No. 10-IC: Form No. 10-IC should be filed on or before 31st January 2024.
Conclusion: The CBDT’s decision to condone the delay in filing Form 10-IC for A.Y. 2021-22 is a positive development for companies that may have missed the initial deadline. Companies that meet the aforementioned conditions should seize this opportunity and promptly file Form 10-IC to take advantage of the concessional tax rate offered under Section 115BAA. This relief demonstrates the tax authorities’ understanding of the challenges faced by taxpayers and provides a way to rectify unintentional delays in compliance. It is advisable for eligible companies to act promptly to ensure they benefit from this relief.