Case Law Details
Dolli Chandrashekhar Shankar (HUF) Vs ACIT (ITAT Pune)
ITAT Pune held that order u/s 119 dated 27.09.2019 extending due date to 31.10.2019 in respect of cases covered under Explanation 2(a) to section 139(1) applies to HUF too. Accordingly, as return by HUF filed within extended time limit, deduction u/s 80IA(7) of Income Tax Act allowable.
Facts- The only issue raised in this appeal is against disallowance of deduction u/s.80IA(7) amounting to Rs.9,21,740/- and further not permitting carry forward of current year short term capital loss amounting to Rs.1,85,900/-, in Intimation u/s 143(1) of the Income-tax Act, 1961 (hereinafter called `the Act’), both on the ground that the assessee filed return beyond the due date as prescribed u/s 139(1) of the Act.
It is noted from the impugned order that the assessee furnished return on 10-09-2019, which is beyond the due date expressed u/s.139(1) as 3 1-08-2019. It is relevant to note that the said date was extended by an Order of the Board dated 27-09-2019 up to 31-10-2019. If we go by the extended date, then the return filed by the assessee on 10-09-2019 is within time. However, the ld. CIT(A) has held the assessee to be disentitled to the benefits on the ground that the extension did not apply to the assessee-HUF.
Conclusion- Held that ld. CIT(A) has denied the benefit of the Board’s Order by opining that an HUF cannot be considered as a `person’. In our considered opinion, this interpretation is not in accordance with law. Clause (a)(ii) of the Explanation 2 to section 139(1) covers any person whose accounts are required to be audited. Such a `person’ may be Individual, HUF or a Body Corporate etc. Since the assesseeHUF was required to get its accounts audited, the case falls in Explanation 2(a)(ii) to section 139(1), entitling the assessee to the extended date of 31-10-2019. As the return was filed before the extended due date, we hold that the assessee is entitled to the benefit of deduction u/s.80IA(7) and also carry forward of the short term capital loss.
FULL TEXT OF THE ORDER OF ITAT PUNE
This appeal by the assessee is directed against the order dated 16-03-2021 passed by the CIT(A) in National Faceless Appeal Centre, Delhi in relation to the assessment year 2019-20.
2. The only issue raised in this appeal is against disallowance of deduction u/s.80IA(7) amounting to Rs.9,21,740/- and further not permitting carry forward of current year short term capital loss amounting to Rs.1,85,900/-, in Intimation u/s 143(1) of the Income-tax Act, 1961 (hereinafter called `the Act’), both on the ground that the assessee filed return beyond the due date as prescribed u/s 13 9(1) of the Act.
3. Succinctly, the facts of the case are that the assessee is an HUF, who filed its return on 10-09-2019 claiming deduction u/s.80IA(7) and carry forward of the above referred amounts. An Intimation was issued u/s. 143(1), not allowing the above items on account of late filing of the return. The assessee challenged such Intimation before the ld. CIT(A) contending that the due date was extended by 3 1-10-2019. The ld. CIT(A) went through the Order u/s.119 dated 27-09-2019 extending the due date to 3 1-10-2019 in respect of cases falling under Explanation 2(a) to section 139(1). Since the assessee is an HUF, not covered by Explanation 2(a) to section 139(1) as opined by the ld. CIT(A), the carry forward of loss and deduction u/s.80IA(7) was held to be rightly denied.
4. We have heard the ld. DR and gone through the written submissions furnished on behalf of the assessee. Primarily, it is noted from the impugned order that the assessee furnished return on 10-09-2019, which is beyond the due date expressed u/s.139(1) as 3 1-08-2019. It is relevant to note that the said date was extended by an Order of the Board dated 27-09-2019 up to 31-10-2019. If we go by the extended date, then the return filed by the assessee on 10-09-2019 is within time. However, the ld. CIT(A) has held the assessee to be disentitled to the benefits on the ground that the extension did not apply to the assessee-HUF. Clause (a)(ii) of Explanation 2 to section 139(1) deals with `due date’ as concerning a person other than a company whose accounts are required to be audited under the Act or under any law for the time being in force. The accounts of the assessee were audited, which is an admitted position. The ld. CIT(A) has denied the benefit of the Board’s Order by opining that an HUF cannot be considered as a `person’. In our considered opinion, this interpretation is not in accordance with law. Clause (a)(ii) of the Explanation 2 to section 139(1) covers any person whose accounts are required to be audited. Such a `person’ may be Individual, HUF or a Body Corporate etc. Since the assessee HUF was required to get its accounts audited, the case falls in Explanation 2(a)(ii) to section 139(1), entitling the assessee to the extended date of 3 1-10-2019. As the return was filed before the extended due date, we hold that the assessee is entitled to the benefit of deduction u/s.80IA(7) and also carry forward of the short term capital loss as discussed above.
5. In the result, the appeal is allowed.
Order pronounced in the Open Court on 07th February, 2023.
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