ITO Vs Dogra Educational Society (ITAT Delhi)
Late Form 10B Not Fatal: ITAT Upholds Section 11 Exemption and Rejects Revenue’s Technical Objection
The Delhi ITAT dismissed the Revenue’s appeal and upheld grant of exemption under Section 11 to Dogra Educational Society for AY 2018-19, holding that belated filing of audit report in Form 10B is only a procedural lapse and does not disentitle a charitable trust from exemption. The Assessing Officer had denied exemption on the ground that the assessee failed to e-file Form 10B along with the return and filed it after the due date, thereby violating Section 12A(1)(b) and Rule 12(2).
The Tribunal noted that the assessee was duly registered under Section 12A and had otherwise satisfied the substantive conditions for exemption. Relying on the Gujarat High Court judgment in Sarvodaya Charitable Trust and several Tribunal decisions, it was held that furnishing of Form 10B along with the return is a directory requirement and substantial compliance is sufficient. The audit report having been filed before completion of assessment, exemption could not be denied merely on technical delay.
The Revenue’s reliance on CBDT Circular No. 2/2020 and the argument that condonation under Section 119(2)(b) was mandatory were rejected, as judicial precedents have consistently treated the requirement as procedural. In absence of any contrary binding decision, the Tribunal refused to interfere with the CIT(A)’s order and dismissed the Revenue’s appeal in full.
FULL TEXT OF THE ORDER OF ITAT DELHI
This appeal is preferred by the Revenue against the order dated 06.08.2024 of the Ld. National Faceless Appeal Centre (NFAC) (hereinafter referred as Ld. First Appellate Authority or in short Ld. ‘FAA’) in DIN & Order No : ITBA/NFAC/S/250/2024-25/1067372748(1)arising out of the order dated 21.04.2021 u/s 143(3) r.w.s 144B of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) passed by the Faceless Assessing Officer, National e-Assessment Centre, Delhi for AY: 2018-19.
