Vaaman Fab Private Limited Vs ITO (ITAT Jaipur)
A Typo Cannot Tax a Company Before It Was Born—Corrected Form 10-ID Relates Back & 15% Tax Rate u/s 115BAB Cannot Be Denied
The Jaipur Bench of the ITAT has held that where a company filed Form 10-ID within the prescribed time but inadvertently mentioned a financial year during which the company was not even in existence, the mistake was an obvious clerical error capable of rectification. The corrected Form 10-ID filed pursuant to the advice of the Department’s grievance cell could not be treated as a fresh and belated exercise of option. The assessee was consequently entitled to the concessional tax rate of 15% u/s 115BAB.
Vaaman Fab Private Limited had opted for the concessional taxation regime applicable to eligible new domestic manufacturing companies. To exercise this option, the assessee filed Form 10-ID on 01.04.2021. The form, however, incorrectly stated that the option was being exercised for FY 2019-20 and subsequent years.
The mistake was apparent from the contents of the form itself. The company had been incorporated only on 24.07.2020. Therefore, it could not possibly have exercised an option for a financial year during which it had no legal existence.
