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Issues involved: Appeal against denial of exemption u/s 11 of the IT Act for A.Y. 2002-03.
Summary: The assessee-trust, engaged in promoting education, filed an appeal against the denial of exemption u/s 11 of the IT Act by the CIT(A)-III Pune. The Assessing Officer disallowed the exemption due to the absence of Form 10B, resulting in the addition of Rs. 3,36,31,937 to the taxable amount, a decision upheld by the CIT(A). The assessee contended that Form 10B was submitted at the appellate stage, citing the departure of their previous auditor as the reason for the delay. An affidavit was presented to support this claim, but the CIT(A) did not accept it. The assessee argued that the CIT(A) should have considered the late audit report and requested the matter to be sent back to the Assessing Officer for review. The Assessing Officer and the DR supported the previous decisions, with the DR suggesting a fresh review if the case was remanded. Upon review, the ITAT found that the audit report was indeed submitted at the appellate stage, with reasons for the delay provided. The ITAT believed that the CIT(A) should have considered this information and, in the interest of justice, remanded the issue back to the Assessing Officer for a fresh decision based on facts and law, ensuring a fair hearing for the assessee. The ITAT refrained from commenting on the merits of the issue due to the remand. As a result, the appeal was allowed for statistical purposes, with the order pronounced in the open court on 31st May 2011.
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