Maya Charitable Foundation Vs ITO (ITAT Pune)
Assessment Order Set Aside Because Condonation of Delay in Filing Form 10B Was Not Considered; ITAT Remands Matter Because Form 10B Delay Was Later Condoned by CIT(Exemption); Section 11 Exemption Claim Reopened Because Form 10B Condonation Order Was Unavailable During Assessment; ITAT Allows Appeal for Statistical Purpose Because Delay in Filing Audit Form Was Condoned; Exemption Under Section 11 Requires Fresh Examination Because Delayed Form 10B Filing Was Condoned; ITAT Sets Aside Assessment Because Assessee Later Corrected Wrong Exemption Claim; Denial of Section 11 Benefit Sent Back for Reconsideration Because Form 10B Was Filed Before Assessment Completion; Pune ITAT Orders Fresh Review Because Delayed Form 10B Filing Was Subsequently Regularised; Assessment Remanded Because CIT(Exemption) Later Accepted Delayed Filing of Form 10B
The Pune Bench of the Income Tax Appellate Tribunal heard an appeal filed by the assessee against the order passed by the Additional/Joint Commissioner of Income Tax (Appeals), Panaji under Section 250 of the Income Tax Act for Assessment Year 2016-17. The appeal arose from an assessment order passed under Section 143(3) of the Act.
The assessee challenged the appellate order on several grounds, including denial of exemption under Section 11 of the Income Tax Act, confirmation of assessed income of Rs.24,74,235 against nil returned income, and disallowance of Rs.18,98,761 merely because Form No.10B was not filed within the prescribed time. The assessee also contended that filing of Form No.10B was directory and not mandatory in nature and that the appellate authority failed to consider judicial precedents supporting the claim.
The assessee further argued that certain expenses had been inadvertently claimed under Section 10(23C)(via) instead of claiming exemption under Section 11 and that this mistake was unintentional. It was also submitted that Form No.10B had been filed before completion of the assessment proceedings and was furnished during the course of assessment proceedings.
During the hearing before the Tribunal, the authorised representative for the assessee submitted that the Assessing Officer denied the benefit of Section 11 solely because Form No.10B was filed beyond the prescribed statutory time limit. It was further submitted that the assessee had applied for condonation of delay before the Commissioner of Income Tax (Exemption), who subsequently condoned the delay through an order dated 14.07.2022.
The Departmental Representative relied upon the orders passed by the Assessing Officer and the Commissioner (Appeals).
The Tribunal examined the record and observed that the assessee had originally filed its return of income declaring nil income. The case was selected for scrutiny, during which the Assessing Officer noticed that exemption had been claimed under Section 10(23C)(via). The Assessing Officer recorded that the assessee was not existing solely for educational purposes and did not possess approval under Section 10(23C)(via).
The Tribunal further noted that the assessee later clarified through a letter dated 27.11.2018 that exemption under Section 10(23C)(via) had been wrongly claimed. The assessee also submitted Form No.10B and Form No.10 on the same date and thereafter sought exemption under Section 11 of the Act. However, the Assessing Officer denied the benefit under Section 11 on the ground that Form No.10B and Form No.10 were not filed along with the return of income within the period prescribed under Section 139(1). The appellate authority upheld the assessment order.
The Tribunal then examined the condonation order dated 14.07.2022 issued by the Commissioner of Income Tax (Exemption). It observed that the delay in filing Form No.10B for Assessment Year 2016-17 had been condoned subject to conditions mentioned in the order. The Tribunal also observed that this condonation order was not available before the Assessing Officer at the time of passing the assessment order.
Considering these facts, the Tribunal held that, in the interest of justice, the assessment order should be set aside and restored to the Assessing Officer for reconsideration. The Tribunal directed the Assessing Officer to consider the condonation order passed by the Commissioner of Income Tax (Exemption), provide opportunity to the assessee, and examine the necessary details to be filed by the assessee. Accordingly, the appeal was allowed for statistical purposes.
Assessee Represented by: Shri Sachin P.Kumar –Advocate
FULL TEXT OF THE ORDER OF ITAT PUNE
