T. K. Raja Educational Charitable Trust Vs ITO (ITAT Chennai)
In , the Income Tax Appellate Tribunal (ITAT), Chennai, dealt with two appeals filed by a charitable educational trust for Assessment Years 2016-17 and 2018-19. The trust was registered under Section 12A of the Income Tax Act and had claimed exemption under Section 11 after filing returns declaring nil income. The dispute arose because the Centralized Processing Centre (CPC) denied the exemption while processing the returns under Section 143(1), on the ground that the audit report in Form 10B was not filed along with the return of income.
For Assessment Year 2018-19, the trust filed its return on 01.10.2018 and uploaded Form 10B on 08.10.2018. The assessee argued that the filing of Form 10B was directory in nature and not mandatory, especially since both the return and audit report were filed before the extended due date prescribed by the CBDT. It also contended that the audit report was already available on record when the CPC processed the return on 31.12.2020. The assessee further argued that if the trust was treated as an Association of Persons (AOP), then expenditure incurred for achieving the trust’s objectives ought to have been allowed as deduction.
