2024 (3) TMI 939 - AT - Income Tax

Deduction u/s 80IC - Claim denied on the ground that the audit report in Form No.10CCB was not filed within the due date - assessee pleaded that there are case laws for the proposition that if Form 10CCB is filed during the course of assessment before the final order the deduction is to be allowed - HELD THAT - The due date of filing of return in this case was 07.11.2017. The return was filed on 29.08.2017 and the Tax audit report was also filed on 28.10.2017 and Form 10CCB on 28.05.2018. The return was processed under section 143(1) of the Act on 08.02.2019 We find that in this case, Form 10CCB was filed before the intimation u/s 143(1) dated 08.02.2019. In these circumstances, the case laws point out that deduction is to be allowed. See G.M. KNITTING INDUSTRIES (P.) LTD. AKS ALLOYS (P.) LTD. 2015 (11) TMI 397 - SC ORDER wherein held that even if form 3AA was not filed along with return of income but the same was filed during the assessment proceedings and before the final order of the assessment was made that would amount to sufficient compliance. Also see GREEN DOT HEALTH FOODS PVT. LTD. 2023 (2) TMI 516 - ITAT DELHI - Appeal of the assessee stands allowed.

Summary

Issues:
The issues involved in the judgment are the addition/adjustments made in the intimation under section 143(1), denial of deduction under section 80IC of the Income Tax Act, 1961, passing of an ex-parte order by the CIT(A), passing order without providing proper opportunity of being heard, and the order passed by CIT(A) being against the principles of natural justice.

Addition/Adjustments Made in Intimation Under Section 143(1):
The appeal filed by the assessee was directed against the order of the Commissioner of Income Tax (Appeals) pertaining to Assessment Year 2017-18. The return of income was filed declaring total income, but the deduction under section 80IC was denied due to the audit report not being filed within the due date. The CIT(A) confirmed the disallowance, but the assessee argued that the audit report was signed before the due date and the delay was due to inadvertence. The ITAT found that the Form 10CCB was filed before the intimation under section 143(1), and based on legal precedents, the deduction was allowed. The appeal was allowed in favor of the assessee.

Denial of Deduction Under Section 80IC:
The denial of deduction under section 80IC was based on the audit report not being filed within the due date, even though the return of income was filed on time. The CIT(A) confirmed the disallowance, but the ITAT, considering legal precedents, held that the deduction should be allowed since the Form 10CCB was filed before the final order of assessment was made. Relying on relevant case laws, the ITAT decided the issue in favor of the assessee, setting aside the orders of the authorities below.

Passing of Ex-parte Order and Denial of Opportunity to be Heard:
The assessee contended that the CIT(A) passed an ex-parte order without providing a proper opportunity to be heard, which was against the principles of natural justice. The ITAT reviewed the submissions of both parties and found that the Form 10CCB was filed before the intimation under section 143(1), allowing the deduction. Citing legal precedents, the ITAT decided in favor of the assessee, setting aside the orders of the authorities below and allowing the appeal.

Conclusion:
Based on the facts presented and legal arguments, the ITAT decided in favor of the assessee on all issues raised in the appeal. The ITAT allowed the appeal, setting aside the orders of the authorities below and granting the deduction under section 80IC.