KN Support Services Pvt. Ltd Vs DCIT (ITAT Delhi)
Assessee, engaged in software development & IT consulting, opted for concessional tax regime u/s 115BAA (22%). It e-filed Form 10-IC on 19.12.2022 & return on 23.12.2022, whereas the extended due date u/s 139(1) was 07.11.2022. CPC processed return u/s 143(1) applying normal tax rate of 30% & MAT u/s 115JB, holding that delayed Form 10-IC invalidated option for concessional regime. CIT(A) upheld.
Before ITAT, Assessee explained delay arose due to search on its parent entity by DGGI in Nov 2021, delaying finalization of accounts. It argued that filing Form 10-IC before return filing was substantial compliance, & denial of benefit was merely on technical grounds. Reliance was placed on judicial precedents (Bajaj Tempo Ltd., CIT v. J.H. Gotla, Akshay Devendra Birari Pune ITAT, Bansal Corelam Pvt. Ltd. Delhi ITAT, Aprameya Engineering Ltd. Ahmedabad ITAT, Cell Com Teleservices Allahabad HC, Krishna Gopal Dwivedi HUF Mumbai ITAT).
Tribunal accepted that Assessee’s intent to opt u/s 115BAA was clear from tax audit report (Form 3CA) & computation in ITR. Tax was actually paid @22%. Filing Form 10-IC belatedly was held a procedural lapse. Applying doctrine of substantial compliance (SC in Dilip Kumar, 2018) & liberal interpretation of “genuine hardship” (Allahabad HC in Cell Com Teleservices), ITAT held benefit cannot be denied for technical delay. Accordingly, ITAT directed AO to recompute tax at 22% u/s 115BAA, without applying MAT.
