K M Educational & Rural-Development Trust Vs ITO (ITAT Chennai)
In the case of K M Educational & Rural-Development Trust vs. ITO, the Income Tax Appellate Tribunal (ITAT) Chennai addressed an appeal concerning the denial of exemption under Section 11 of the Income Tax Act, 1961, by the Centralized Processing Center (CPC). The assessee, a trust registered under Section 12A, had filed its Return of Income (RoI) for the Assessment Year (AY) 2018-19 after the due date specified under Section 139(1) but within the extended period allowed under Section 139(4A). The issue at hand was whether the assessee could claim exemption under Section 11 despite the belated filing of the RoI.
The CPC had disallowed the exemption under Section 11, asserting that the trust did not file the RoI within the prescribed time limit of Section 139(1) of the Income Tax Act. However, the assessee filed its return on November 30, 2018, after the September 30, 2018 deadline but before the extended deadline of November 30, 2018, as per Section 139(4A). Despite the filing delay, the assessee argued that it should still be eligible for the exemption under Section 11, relying on a CBDT Circular No.173/193/2019-ITA-I dated April 23, 2019. The Circular clarifies that if a trust files its RoI within the time allowed under Section 139(4A), the exemption under Section 11 should not be denied.
