Sindhi Educational Society Vs PCIT (Madras High Court)
Madras High Court: Delay in Filing Form 10 Must Be Condoned—Substantive Section 11 Exemption Cannot Be Denied for Technical Lapse
The Madras High Court allowed the writ petition filed by M/s. Sindhi Educational Society (Madras) and set aside the order of the Principal Commissioner rejecting condonation of delay in filing Form 10 under section 119(2)(b) for AY 2015–16. The petitioner-trust, registered under section 12AA, had filed its return of income and audit report in Form 10B within the due date, but filed Form 10 belatedly with a delay of 530 days. On this technical ground, exemption under section 11 was denied and a substantial demand was raised.
The PCIT rejected the condonation petition solely on the basis of CBDT Circular No. 9/2015, holding that the application itself was filed beyond six years from the end of the assessment year and was therefore not entertainable. The High Court held that such reasoning was unsustainable, observing that a substantive statutory benefit available to a charitable trust cannot be denied for a mere technical or procedural lapse, particularly when compliance with section 11 was otherwise not in dispute.
The Court emphasized that the delay in filing Form 10 ought to have been condoned, notwithstanding the Circular, and that administrative instructions cannot override the object of the Act. Accordingly, the impugned order was quashed, the delay in filing Form 10 was directed to be condoned, and the Assessing Officer was instructed to pass a consequential speaking order after verifying compliance with section 11. The writ petition was thus allowed, granting relief to the assessee-trust.
FULL TEXT OF THE JUDGMENT/ORDER OF MADRAS HIGH COURT
The petitioner is before this Court challenging the impugned order dated 17.05.2023 passed under Section 119(2)(b) of the Income Tax Act. By the impugned order, the petitioner’s request to file Form-10 for the assessment year 2015-2016 on 15.04.2017, with a delay of 530 days, has been rejected.
