ACIT Vs MARS Telecom Systems Private Limited (ITAT Hyderabad)
ITAT Hyderabad: Section 10AA Deduction Allowed Despite Late ITR & Minor Form 56F Delay; Procedural Lapses Not Fatal
In this case, the Revenue challenged allowance of deduction under section 10AA on two grounds—delay in filing return of income for A.Y. 2019-20 and delay of 16 minutes in filing Form 56F for A.Y. 2021-22. The AO/CPC had disallowed the deduction on these procedural grounds.
The ITAT upheld the CIT(A)’s view that for A.Y. 2019-20, filing of return within due date u/s 139(1) was not a mandatory condition for claiming deduction under section 10AA, as such requirement was introduced only prospectively by Finance Act, 2023 (from A.Y. 2024-25 onwards).
For A.Y. 2021-22, the Tribunal held that the 16-minute delay in uploading Form 56F was due to technical issues on the ITBA portal and not attributable to the assessee, and hence cannot be a ground to deny deduction.
The ITAT also rejected Revenue’s reliance on the Supreme Court ruling in Wipro Ltd., clarifying that it pertained to section 10B, which has stricter conditions not applicable to section 10AA.
Accordingly, the Tribunal upheld the CIT(A)’s order allowing deduction under section 10AA for both years and dismissed the Revenue’s appeals.
FULL TEXT OF THE ORDER OF ITAT HYDERABAD
The captioned appeals filed by the Revenue are directed against the separate, but identical orders of the learned Addl/Joint Commissioner of Income Tax (Appeals) – 1, Chandigarh (for short “Ld. CIT(A)”) pertaining to the assessment years 2019-20 and 2021-22, respectively. Since facts are identical and common issues are involved in both these appeals, the same were heard together and are being disposed of, by this single consolidated order for the sake of convenience and brevity.
