Metro Brands Limited Vs DCIT (ITAT Mumbai)
Metro Brands Limited, a listed company engaged in the retail business of fashion footwear, bags and accessories, filed its return of income for Assessment Year 2023-24 on 31-10-2023 declaring total income of Rs. 528.54 crore and claiming a refund of Rs. 1,55,58,570/-. It claimed a deduction of Rs. 1,28,57,142/- under section 80JJAA of the Income-tax Act, 1961, comprising Rs. 13,35,207/- relating to the immediately preceding year and Rs. 1,15,21,935/- towards additional employment during the year.
The assessee submitted that its Chartered Accountant had issued Form 10DA physically on 15-09-2023, bearing UDIN 23102939BGWNEL6500, within the specified date. However, the form was inadvertently e-filed on the income-tax portal on 09-10-2023. The CPC proposed an adjustment of Rs. 1,00,36,584/- under section 143(1)(a)(ii), restricting the deduction to the amount reported in Form 10DA of AY 2022-23. The assessee responded to the proposed adjustment and contended that Form 10DA had been signed within the prescribed period and that the deduction was otherwise allowable.
The CIT(A) sustained the CPC’s disallowance, following which the assessee appealed before the ITAT Mumbai. Before the Tribunal, the assessee submitted that all substantive conditions for claiming deduction under section 80JJAA had been satisfied and that the delay in online filing of Form 10DA was only procedural. Reliance was also placed on decisions of the Delhi, Bangalore and Ahmedabad Benches of the Tribunal.
The Revenue, on the other hand, relied upon the findings of the CIT(A) and submitted that Form 10DA was required to be furnished electronically by 30-09-2023, whereas it was actually e-filed on 09-10-2023. It therefore contended that the disallowance was justified.
The Tribunal noted that the Chartered Accountant had issued Form 10DA on 15-09-2023, the tax auditor had reported the deduction in Form 3CA read with Form 3CD e-signed and e-filed on 29-09-2023, and the assessee had claimed the deduction in its return filed on 31-10-2023. Form 10DA was available on the e-filing portal when the CPC proposed the adjustment on 23-11-2023 and when the return was processed and the intimation under section 143(1) was issued on 10-05-2024.
The Tribunal held that the filing of the audit report is a mandatory condition for the deduction, while the mode and stage of filing are procedural aspects. It observed that the courts and Coordinate Benches had consistently held that where the audit report is available at the time of processing the return or framing the assessment, delay in filing the report is not fatal to the deduction claim. The Tribunal therefore held that the due date for filing Form 10DA should be construed liberally in the circumstances of the case.
Since Form 10DA was available on record before the return was filed and before the CPC processed the return, the Tribunal found no justifiable and legal basis to deny the deduction. It directed that the assessee’s claim of deduction under section 80JJAA be allowed and consequently allowed the appeal.
Facts and Claim of Deduction under Section 80JJAA
The assessee claimed deduction of Rs. 1,28,57,142/- under section 80JJAA. The break-up furnished before the Tribunal was:
| Particulars | Amount (Rs.) |
|---|---|
| Deduction for immediately preceding year, i.e. A.Y. 2022-23 | 13,35,207 |
| Additional employment during the year under appeal | 1,15,21,935 |
| Total | 1,28,57,142 |
The assessee submitted that clause (c) of sub-section (2) of section 80JJAA required a certificate from a Chartered Accountant in Form 10DA before the specified date referred to in section 44AB. According to the submission, the specified date for AY 2023-24 was 30-09-2023.
Delay in E-Filing of Form 10DA
The Chartered Accountant issued Form 10DA in physical form on 15-09-2023. The form bore UDIN 23102939BGWNEL6500, which was generated on the same date. However, the form was e-filed on the income-tax portal on 09-10-2023.
The assessee submitted that the deduction should not be denied merely due to the delayed online filing because the certificate had already been issued within the specified period and the Form 10DA was available on the portal before the return was processed.
The issue concerned the procedural consequence of delayed filing of Form 10DA in a case where the deduction claim and supporting report were otherwise available on record.
CPC Adjustment under Section 143(1)
While processing the return under section 143(1), the CPC proposed an adjustment of Rs. 1,00,36,584/-. The proposed adjustment represented the difference between the deduction of Rs. 1,28,57,142/- claimed in the return and Rs. 28,20,558/- reported in Form 10DA of AY 2022-23.
| Particulars | Amount (Rs.) |
|---|---|
| Deduction claimed under section 80JJAA | 1,28,57,142 |
| Amount reported in Form 10DA of AY 2022-23 | 28,20,558 |
| Proposed adjustment | 1,00,36,584 |
The CPC’s stated reason was that the deduction claimed under section 80JJAA exceeded the amount mentioned in Form 10DA filed within the due date.
Assessee’s Submissions
The assessee submitted that it had correctly claimed the deduction of Rs. 1,28,57,142/- and had furnished the relevant details in Form 10DA for AY 2023-24. It specifically relied upon the fact that the Form 10DA had been signed on 15-09-2023 and carried the UDIN generated on that date.
Before the Tribunal, the assessee further submitted that the tax auditor had reported the section 80JJAA deduction in Clause No. 33 of Form 3CD. It contended that although Form 10DA was inadvertently e-filed after the specified date, it was available on record before the CPC processed the return and before the return of income was filed.
The assessee relied upon Akuntha Projects Pvt. Ltd. Vs Deputy Director (ITAT Ahmedabad), Sai Computers Ltd. vs. ACIT-CPC, Jeans Knit (P.) Ltd. vs. DCIT and Sunrise Industries (India) Ltd. Vs DCIT (ITAT Ahmedabad).
Revenue’s Submissions
The Ld.DR relied upon the findings of the Ld.CIT(A) and referred to section 80JJAA, Rule 19AB, section 44AB and Rule 12(2). It was submitted that Form 10DA was required to be furnished electronically one month before the due date for filing the return under section 139(1).
According to the Revenue’s submission, since the due date for filing the return in the case was 31-10-2023, Form 10DA was required to be filed on or before 30-09-2023. As the assessee e-filed the form on 09-10-2023, the Revenue contended that the CIT(A) had rightly sustained the disallowance.
ITAT Mumbai’s Observations and Findings
Form 10DA Was Available Before CPC Processing
The Tribunal recorded as undisputed facts that the Chartered Accountant issued Form 10DA on 15-09-2023, while the assessee uploaded it on the e-filing portal on 09-10-2023. The tax auditor reported the deduction in Form 3CA read with Form 3CD, which was e-signed and e-filed on 29-09-2023. The assessee claimed the deduction in its return filed on 31-10-2023.
The CPC proposed the adjustment on 23-11-2023 and processed the return, issuing the intimation under section 143(1) on 10-05-2024. The Tribunal noted that Form 10DA was available on the e-filing portal both when the proposed adjustment was made and when the return was processed.
Nature of Delay in Filing Form 10DA
The Tribunal considered whether the nine-day delay in e-filing Form 10DA could justify denial of the section 80JJAA deduction while processing the return under section 143(1).
It observed that the courts and Coordinate Benches of the Tribunal had consistently held that filing the audit report is a mandatory condition for claiming the deduction, but that the mode and stage of filing the audit report are procedural aspects. Where the audit report is available at the time of processing the return or framing the assessment, delay in filing the report is not fatal to the deduction claim.
Construction of the Due Date
The Tribunal held that the due date for filing Form 10DA should be construed liberally in the facts and circumstances of the case. It considered the assessee’s case to be on a better footing because Form 10DA was available on record not merely when the return was processed, but before the filing of the return itself.
Final Decision
The Tribunal concluded that there was no justifiable and legal basis to deny the assessee’s claim of deduction under section 80JJAA. It directed that the deduction be allowed and held that the assessee could not be denied the claim on account of the delay in e-filing Form 10DA.
Accordingly, the appeal of the assessee was allowed. The order was pronounced in the open court on 17-06-2025.
Cases Discussed
- Sunrise Industries (India) Ltd., vs. DCIT, ITA No. 282/Ahd/2025, dt. 21-05-2025 — ITAT Ahmedabad.
- Akuntha Projects (P.) Ltd. Vs. Deputy Director-CPC, [2024] 162 taxmann.com 861 (Ahmedabad-Trib) — ITAT Ahmedabad.
- Sai Computers Ltd. vs. ACIT-CPC, [2023] 155 taxmann.com 607 (Delhi-Trib) — Delhi-Trib.
- Jeans Knit (P.) Ltd. vs. DCIT, [2022] 138 taxmann.com 480 (Bangalore-Trib) — Bangalore-Trib.
FULL TEXT OF THE ORDER OF ITAT MUMBAI
This is an appeal filed by the assessee against the order of the Addl/JCIT(A)-1, Visakhapatnam [Ld.CIT(A)?], dated 18-12-2024, pertaining to Assessment Year (AY) 2023-24, wherein the assessee has taken the following grounds of appeal:
”1. The Learned Commissioner of Income Tax (Appeals) (“Ld. CIT(A)”) has erred in confirming action of the CPC in denying the deduction of Rs. 1,28,57,142/- claimed under section 80JJAA of Act. On the facts and circumstances of the case and in law, deduction claimed under section 80JJAA of Act amounting to Rs. 1,28,57,142/- ought to be allowed.
2. The Appellant craves leave to add, alter, amend and/or rescind any grounds of appeal during the course of the hearing.”
2. During the course of hearing, Ld.AR submitted that the assessee is a listed company and is engaged in the retail business of fashion footwear, bags and accessories. It filed its original return of income on 31-10-2023 declaring total income of Rs. 528.54 crore and claiming refund of Rs. 1,55,58,570/-. It was further submitted that in the return of income, the assessee has claimed deduction of Rs. 1,28,57,142/- under section 80JJAA of the Income-tax Act 1961 (“the Act”) and the break-up of the deduction claimed is as under:
| Particulars | Amount (Rs.) | |
|---|---|---|
| 1. | Deduction for immediately preceding year (ie. A.Y 2022-23) to the previous year | 13,35,207 |
| 2. | Additional employment during the year under appeal | 1,15,21,935 |
| Total | 1,28,57,142 |
3. It was also submitted that as per clause (c) of sub-section (2) of section 80JJAA, the assessee was required to furnish a certificate from a chartered accountant in Form 10DA before the ‘specified date’ as mentioned in section 44AB of the Act. As per explanation to section 44AB of the Act “specified date” means the date one month prior to the due date of furnishing return of income under section 139(1) of the Act which falls on 30th September 2023 for A.Y 2023-24. The Chartered accountant has issued certificate in form 10DA in physical form on 15-09-2023 (bearing UDIN 23102939BGWNEL6500 which was generated on 15-09-2023 itself showing the deduction of 1,28,57,142/-), however, inadvertently the Form 10DA was e-filed on income tax portal on 09-10-2023.
4. It was submitted that the Centralized Processing Center (“CPC”) while processing the return of income under section 143(1) of the Act has proposed an adjustment of Rs. 1,00,36,584/-(i.e. Rs.1,28,57,142/- less Rs. 28,20,558/- being amount of deduction reported in Form 10DA of AY 2022-23) under section 143(1)(a)(ii) of Act as under:
| Sr. No. |
Schedule | Error Description | As per return | As computed | Variance |
| 1. | Schedule VIA | In Schedule VI-A Deduction claimed u/s 80JJAA is more than the amount mentioned in Form(s) 10DA filed within the due date. Hence deduction u/s 80JJAA will be restricted to the extent of amounts mentioned in the form(s) 10DA filed with-in the due date. |
1,28,57,142/- | 28,20,558/- | 1,00,36,584/- |
5. Against the above proposed adjustment, the assessee has filed response as under:
“The Assessee hereby submits that the Assessee has rightly claimed the deduction under section 80JJAA amounting to Rs. 1,28,57,142/- and details of the same are furnished while filing Form 10DA of AY 2023-24. Further we hereby submit that Form 10DA was signed on 15 September 2023 (bearing UDIN 23102939BGWNEL6500) which is within the due date specified in section 80JJAA of the Income-tax Act, 1961. In view of the above, the Assessee hereby requests Your Goodself to kindly delete the proposed adjustment”.
6. It was submitted that thereafter, the return of income of the assessee was processed by the CPC and intimation under section 143(1) of the Act was issued to the assessee. It was submitted that on perusal of the aforesaid intimation, the assessee has observed that the CPC has not considered the response filed by the assessee on 22-12-2023 and has disallowed the deduction claimed under section 80JJAA of the Act amounting to Rs. 1,28,57,142/-merely on the ground that the Form 10DA has not been filed within the due date as mentioned in section 80JJAA of the Act without appreciating the fact that Form 10DA was physically signed on 15-09-2023 which is before the due date of filing as per section 80JJAA(2)(c) of the Act. Being aggrieved by the above additions/disallowances, the assessee filed appeal before the ld CIT(A) who has sustained the findings of the CPC and the assessee is now in appeal before us.
7. In the aforesaid factual background, it was submitted by the Ld.AR that the assessee satisfied all the conditions and is eligible to claim deduction u/s. 80JJAA of the Act, except that of filing of on-line Form 10DA on or before the specified date. It was submitted that the Chartered Accountant has issued the certificate in Form 10DA in physical form on 15-09-2023, bearing UDIN No. 23102939BGWNEL6500, which was generated on 15-09-2023 itself which was on or before the specified date as mention in Section 80JJAA of the Act. It was submitted that the tax auditor after verifying the claim, has duly reported in Clause No.33 of Form 3CD that the assessee has claimed a deduction u/s. 80JJAA of the Act. It was further submitted that the Form 10DA though inadvertently filed after the date specified u/s. 80JJAA of the Act, but was on record before the CPC at the time of processing return u/s. 143(1) of the Act. It was submitted that the deduction cannot be denied to the assessee merely because on-line Form 10DA was e-filed after the due date prescribed in section 44AB of the Act; whereas the same was e-filed before filing of the return of income. It was submitted that delay in filing of Form 10DA on- line before the specified date cannot be a reason for denial of deduction u/s. 80JJAA of the Act. Further, reliance was placed on the decision of the Co-ordinate Bench of the Tribunal in case of Sai Computers Ltd. vs. ACIT-CPC [2023] 155 taxmann.com 607 (Delhi-Trib); wherein the Co- ordinate Bench has allowed the deduction u/s. 80JJAA of the Act even though the Form 10DA was filed after the date of filing return of income, but before the date of intimation, holding that the requirement of Rule 19AB and Rule 12(2) are not mandatory per se but are essentially directory in nature. It was submitted that similar findings were recorded by the Co- ordinate Bangalore Bench of the Tribunal in case of Jeans Knit (P.) Ltd. vs. DCIT [2022] 138 taxmann.com 480 (Bangalore-Trib). Further, specific reference was drawn to the decision of the Co-ordinate Ahmedabad Tribunal in case of Akuntha Projects (P.) Ltd. Vs. Deputy Director-CPC [2024] 162 taxmann.com 861 (Ahmedabad-Trib); wherein the relevant findings reads as under:
”9. Accordingly, looking into the instant facts, and the decisions of the Hon’ble Supreme Court and jurisdictional Gujarat High Court referred to above, we are of the considered view that the claim of the assessee appellant for deduction under Section 80JJA of the Act cannot be denied for the reason that firstly, the chartered accountant of the assessee had uploaded Form 10DDA before the due date of filing of return of income, and it was only because of procedural lapse/mistake on the part of the appellant/assessee that the aforesaid form could not be accepted before the due date of filing of return of income, secondly, the assessee appellant had duly accepted the Form 10DDA before the return of income was processed by the CPC on 16.03.2023, thirdly, the Gujarat High Court, has on similar facts observed that although the furnishing of report for claiming the deduction/exemption is mandatory requirement, the mode and stage of filing thereof is a procedural aspect and if the requisite audit report is available with the assessing officer before the assessment order is framed, then the claim of deduction cannot be denied to the assessee/appellant, even if the audit report may not have been filed along with the return of income.”
8. Further, reliance was placed on the decision of the Co-ordinate Ahmedabad Bench in case of Sunrise Industries (India) Ltd., vs. DCIT in ITA No. 282/Ahd/2025, dt. 21-05-2025; wherein the relevant findings reads as under:
”7. We have heard both the parties and perused all the relevant materials available on record. It is pertinent to note that the CIT(A) has categorically mentioned in para 4.4 that the CBDT has authority to grant condonation for delay in Form 10DA and not that of CIT(A). But looking to the circumstances of the case and the decision taken by the Tribunal as well as the ratio followed by Hon’ble Supreme Court and Gujarat High Court, the claim of the assessee for deduction u/s. 80JJAA of the Act cannot be denied only for the reason that the assessee has uploaded Form 10DA after the due date prior to 30 days from the filing of the return of income. The assessee has filed the Form along with the filing of return of income. Thus, it is mere lapse on part of the assessee on the procedural aspects, the assessee cannot be denied the claim of deduction which the assessee is entitled if he would have filed Form 10DA within the stipulated time. allowed.=
9. Per contra, the Ld.DR drawn our reference to the findings of the Ld.CIT(A) and it was submitted that the Ld.CIT(A) after referring to the provisions of section 80JJAA, Rule 19AB, provisions of section 44AB of the Act as well as Rule 12(2) of the Rules has held that the assessee is supposed to furnish Form 10DA electronically one month prior to the due date before furnishing return of income in sub-section (1) of section 139 of the Act and given that the due date for filing the return of income in the instant case was 31-10-2023, the assessee was supposed to file Form 10DA on or before the 30th Sept. 2023; whereas the assessee has actually e-filed Form 10DA on 9th October. 2023. Accordingly, the Ld.CIT(A) has rightly sustained the disallowance of deduction claimed by the assessee u/s. 80JJAA of the Act. It was accordingly submitted that there is no infirmity in the findings of the Ld.CIT(A) and hence the same be confirmed and the appeal of the assessee be dismissed.
10. We have heard the rival contentions and perused the material available on record. The undisputed facts emerging from the records are that the Chartered Accountant has issued Form 10DA on 15-09-2023 which was uploaded by the assessee on the e-fling portal on 09-10-2023, the claim of deduction has been reported by the Tax auditor in Form 3CA r/w Form 3CD e-signed and e-filed on 29-09-2023, thereafter, the assessee in its return of income filed on 31-10-2023 has claimed deduction u/s 80JJA, and thereafter, the CPC has proposed the adjustment on 23-11-2023 and processed the return of income and intimation u/s 143(1) has been issued on 10-05-2024. Therefore, both at the stage of proposed adjustment and at the time of processing of the return of income, Form 10DA was available on e-filing portal. Infact, it is not even the case of the Revenue that Form 10DA was not available at the time of proposed adjustment and processing of return of income by the CPC. Therefore, is it really a case of incorrect claim as apparent from return of income as contemplated u/s 143(1)(a)(ii) where the claim in the return of income is substantiated by the relevant information in Form 10DA available on record. In any case, once the assessee has responded to the proposed adjustment, there is no finding recorded by the CPC in this regard and the adjustment has been finally done.
11. Having said that the limited dispute relates to the fact that Form 10DA which was supposed to be e-filed on or before 30-09-2023 has been e-filed by the assessee on 09-10-2023 and basis such delay of 9 days, can the claim of deduction u/s 80JJA be denied to the assessee while processing the return of income u/s 143(1) of the Act. In other words, how the due date of filing of Form 10DA should be construed – whether it calls for a literal and stricter interpretation and irrespective of period of delay, it would result in denial of claim of deduction which the assessee is otherwise eligible for or whether it should be construed liberally taking into consideration facts and circumstances of each case. We find that the Courts and the Coordinate Benches of the Tribunal have consistently held that the filing of the audit report is mandatory condition for claim of the deduction, at the same time, the mode and stage of filing of the audit report is a procedural aspect and so long as the audit report is available at the time of processing of return of income or at the time of framing of the assessment, the delay in filing the audit report is not fatal so as to deny the claim of deduction so made by the assessee. We fully subscribe to the said reasoning and in that view of the matter, we are of the considered opinion that the due date of filing of Form 10DA should be construed liberally. The instant case, we find, is clearly on a better footing where Form 10DA was available on record not just at the time of processing of return of income but well before the filing of the return of income and therefore, there is no justifiable and legal basis to deny claim of deduction to the assessee.
12. In light of aforesaid discussion and in the entirety of facts and circumstances of the case, the assessee cannot be denied its claim of deduction u/s 80JJA of the Act and the same is hereby directed to be allowed.
13. In the result, the appeal of the assessee is allowed.
Order pronounced in the open court on 17-06-2025
