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2021 (8) TMI 1041 - AT - Income TaxDisallowance of claim u/s 80IA - return of income was not filled as per provisions of section 139 (1) of the Act - Assessee filed the return of income on 29.03.2014 i.e. after the due date i.e. 31.10.2013 (extended date) of filing of audited return of income u/s 139(1), had lapsed - HELD THAT -We note that essential documents, such as, audited accounts, the tax audit report along with report in Form No. 3CCB for claiming of deduction under section 80IA of the Act were available before the assessing officer. Audited accounts contain the net profit earned by the assessee. Tax audit report contains the information relating to compliance of income tax and Form No. 3CCB contains the information for claiming of deduction under section 80IA - to examine the genuineness of claim of deduction under section 80IA the relevant details and documents were available before the assessing officer - assessee has made substantial compliance. We note that assessee company was facing genuine difficulty, as the assessee company was unable to make the payment of self- assessment tax We note that essential documents, such as, audited accounts, the tax audit report along with report in Form No. 3CCB for claiming of deduction under section 80IA of the Act were available before the assessing officer. Audited accounts contain the net profit earned by the assessee. Tax audit report contains the information relating to compliance of income tax and Form No. 3CCB contains the information for claiming of deduction under section 80IA of the Act. Therefore, to examine the genuineness of claim of deduction under section 80IA the relevant details and documents were available before the assessing officer. Hence, we note that assessee has made substantial compliance. We note that assessee company was facing genuine difficulty, as the assessee company was unable to make the payment of self- assessment tax. Since the assessee has made substantial compliance to claim the deduction under section 80IA of the Act. There are no findings of the assessing officer that assessee is not eligible to claim deduction under section 80IA of the Act. We noticed that there is sufficient compliance with the main requirements to claim the deduction under section 80IA of the Act. In view of the above discussion, the claim of the assessee cannot be denied on technicalities when the assessee is legally otherwise entitled for deduction. As decided in S. VENKATAIAH 2012 (6) TMI 40 - ITAT HYDERABAD claim of the assessee cannot be denied on technicalities when the assessee is legally otherwise entitled for deduction - we direct the assessing officer to allow deduction under section 80IA - Decided in favour of assessee.
Issues Involved:
1. Disallowance of claim under section 80IA of the Income Tax Act due to late filing of the return of income. Issue-Wise Detailed Analysis: 1. Disallowance of Claim under Section 80IA: The primary issue revolves around the disallowance of the assessee's claim for deduction under section 80IA of the Income Tax Act, 1961, due to the late filing of the return of income. The assessee, a private limited company engaged in infrastructure development, filed its return for the Assessment Year 2013-14 belatedly on 29.03.2014, whereas the due date was 31.10.2013. The assessee claimed a deduction of ?13,09,512 under section 80IA, which was disallowed by the assessing officer citing the late filing of the return. Assessee's Argument: The assessee argued that the tax audit report and Form No. 10CCB required for claiming the deduction under section 80IA were filed on time. The delay in filing the return was due to financial stringency, which prevented the payment of self-assessment tax amounting to ?1,50,21,672. The assessee contended that substantial compliance was achieved, and the provisions of section 80AC were directory, not mandatory, as supported by the case of ACIT V/s. V.N. Devados (ITAT Chennai Bench-"A"). Assessing Officer's and CIT(A)'s Stand: The assessing officer rejected the assessee's contention, holding that since the return was filed after the due date, the deduction under section 80IA could not be allowed. This decision was upheld by the Commissioner of Income Tax (Appeals) [CIT(A)]. Tribunal's Analysis: The Tribunal noted that the essential documents, including audited accounts, tax audit report, and Form No. 3CCB, were available before the assessing officer, indicating substantial compliance. The Tribunal acknowledged the financial difficulties faced by the assessee, which led to the delay in filing the return. It was emphasized that the primary compliance requirements for claiming the deduction under section 80IA were met, and the delay was due to genuine reasons beyond the assessee's control. The Tribunal referenced several judicial precedents, including the case of CIT V/s. Medicop Ltd (2010) 323 ITR 554 (MP), which held that the filing of the audit report is procedural and can be fulfilled at the appellate stage. The Tribunal also cited the Supreme Court's interpretation in Collector of Central Excise vs. Parle Exports (P) Ltd., (1989) 1 SCC 345, emphasizing that once the initial compliance hurdle is crossed, the provisions should be construed liberally. Conclusion: The Tribunal concluded that the assessee had made substantial compliance and was legally entitled to the deduction under section 80IA. The deduction could not be denied on technical grounds when the assessee met the main requirements. The Tribunal directed the assessing officer to allow the deduction of ?13,09,512 under section 80IA, making it clear that this adjudication should not be treated as a precedent for other assessment years. Final Order: The appeal filed by the assessee was allowed, and the order was pronounced on 23/08/2021 by placing the result on the Notice Board.
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