2024 (6) TMI 1027 - AT - Income Tax

Denial of deductions for applications and accumulation u/s 11 - delay in filing Form No. 10B - HELD THAT - We after hearing the rival submission of the parties and perusing the material available on record find that in the present appeal, the ld. CIT(E), Kolkata condoning the delay occurred in filing the audit report in Form No. 10B. Accordingly, we set aside the issue to the file of assessing officer, ADIT, CPC, Bengaluru to take into account the above referred order allowing deductions for applications and accumulation u/s 11 of the Act as claimed by the assessee for the assessment year under consideration. In terms of the above, the appeal of the assessee is hereby allowed for statistical purposes.

Summary

Issues:
1. Denial of deductions for applications and accumulation u/s 11 for the assessment year 2020-21.
2. Condonation of delay in filing Form No. 10B.
3. Consideration of the order dated 14.05.2024 passed by the Commissioner of Income-tax (Exemption), Kolkata for allowing deductions.

Analysis:
1. The appeal was filed against the order of the ld. CIT(A) dismissing the appeal in relation to denial of deductions for applications and accumulation u/s 11 for the assessment year in question. The ld. CIT(A) based the dismissal on the late filing of the audit report in Form No. 10B, which was electronically filed after the due date of 15.01.2021. The appellate authority cited lack of power to condone the delay in filing Form No. 10B as the reason for dismissal.

2. Subsequently, the assessee submitted an application on 12.12.2023 before the Jurisdictional Ld. Commissioner of Income-tax (Exemption), Kolkata seeking condonation of the delay in filing Form No. 10B. The Commissioner, in an order dated 14.05.2024, considered the application under section 119(2)(b) of the Act and condoned the delay of sixty-six days in filing the audit report in Form No. 10B for the assessment year 2020-21. The Commissioner relied on CBDT Circular No. 2/2020 and Rule 17B of the Income Tax Rules, 1962, to justify the decision.

3. The Appellate Tribunal, after hearing both parties and reviewing the Commissioner's order, set aside the issue to the file of the assessing officer, ADIT, CPC, Bengaluru. The Tribunal directed the officer to consider the order dated 14.05.2024, which allowed deductions for applications and accumulation u/s 11 of the Act as claimed by the assessee. Consequently, the appeal of the assessee was allowed for statistical purposes, in line with the Commissioner's decision to condone the delay in filing Form No. 10B.

Conclusion:
The Tribunal's decision to set aside the denial of deductions and allow the appeal for statistical purposes was based on the Commissioner's order condoning the delay in filing the audit report in Form No. 10B. The proper consideration of the Commissioner's decision led to the favorable outcome for the assessee regarding the deductions under section 11 of the Act for the assessment year 2020-21.