Manav Seva Trust Vs A.O. (ITAT Kolkata)
ITAT Kolkata ruled in favor of Manav Seva Trust, a registered charitable trust under Section 12A of the Income Tax Act, after its exemption claim was denied due to the late filing of Form-10B. The trust had filed its income tax return for AY 2018-19 on September 30, 2018, which was processed under Section 143(1). However, the CPC disallowed the exemption claim in an order dated March 18, 2020, as Form-10B was not submitted. The CIT(A) upheld this decision, citing that the trust did not seek condonation of delay under CBDT Circular No. 16/2022. The trust appealed to ITAT, arguing that the omission was an oversight and should be considered a curable defect.
The tribunal reviewed legal precedents, including rulings by the Orissa, Telangana, and Bombay High Courts, which consistently held that procedural delays in filing Form-10B should be condoned if there is no malafide intent. It noted that similar cases emphasized balancing procedural compliance with equitable considerations. ITAT concluded that the delay was neither intentional nor deliberate and should not deprive the trust of its exemption benefits. Consequently, ITAT condoned the delay, allowing the trust’s exemption claim, and directed the Assessing Officer to process the return accordingly. The appeal was allowed for statistical purposes, reinforcing that procedural lapses should not obstruct genuine claims under tax law.
