Nachiket Dipak Shah Vs ITO (ITAT Ahmedabad)
Income Tax Appellate Tribunal (ITAT) Ahmedabad has ruled in favor of the assessee, Nachiket Dipak Shah, allowing a deduction under Section 10AA of the Income Tax Act, 1961, despite a delay in filing Form 56F. The case pertained to the Assessment Year (AY) 2017-18, where the Centralized Processing Center (CPC), Bengaluru, had disallowed the claim citing non-submission of the mandatory audit report along with the income tax return. Subsequent rectification petitions were also rejected, leading to a demand of Rs. 5,32,110/-. The Commissioner of Income Tax (Appeals) [CIT(A)] upheld the disallowance, stating that timely submission of Form 56F was a mandatory requirement for claiming the deduction.
During the appeal proceedings before ITAT Ahmedabad, the assessee argued that the filing of Form 56F was a procedural requirement and should not override substantive compliance. The form was submitted on 22.11.2017, before the issuance of the order under Section 143(1) on 24.09.2018. The assessee relied on multiple judicial precedents, including CIT vs. Gujarat Oil and Allied Industries (201 ITR 325) (Guj), Vishnu Exports vs. ACIT (ITA No. 1840/Ahd/2018), and Arvind Kumar Agarwal vs. ITO (ITA No. 917/Del/2022), which emphasized that procedural lapses should not negate valid deductions if compliance is achieved before assessment completion.
