9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2025 (3) TMI 445 - AT - Income TaxDisallowance u/s 11(2) - form no.10 was filed after the expiry of time allowed for filing the return of income u/s 139(1) - HELD THAT - The return filed by the assessee is to be treated as filed within the time allowed u/s 139 of the Act which includes the return filed u/s 139(1) as well as return of income filed u/s 139(4) of the Act. So far as the filing of form no.10 is concerned during the assessment proceedings on 29.08.2018 we are of the considered view that the late filing of the said form is a procedural delay on the part of the assessee and cannot be used as ground for denying the legitimate exemption u/s 11(2) of the Act. The case of the assessee find force from the decision of M/s Indian Sugar Mills Association 2024 (1) TMI 1445 - CALCUTTA HIGH COURT wherein as held that filing of form no.10B is a procedural provision. Similarly in the case of Indian Panel board manufacturer 2023 (3) TMI 1374 - GUJARAT HIGH COURT has held that the non-filing of audit report along with return of income which was at best procedural omission could never lead to an impediment in law in claiming the exemption. Decided in favour of assessee.
ISSUES PRESENTED and CONSIDERED
The core legal issue in this judgment is whether the assessee is entitled to an exemption under Section 11(2) of the Income Tax Act, despite filing the return of income and Form No. 10 beyond the due date specified under Section 139(1) of the Act. The Tribunal examined whether the procedural delay in filing Form No. 10 could be a valid ground for denying the exemption when all substantive conditions were met. ISSUE-WISE DETAILED ANALYSIS Relevant Legal Framework and Precedents The legal framework involves Sections 11(2), 12A, and 139 of the Income Tax Act. Section 11(2) allows for exemption of income accumulated for specific purposes, provided certain conditions are met. Section 12A outlines conditions for availing exemptions under Section 11, including the timely filing of returns as per Section 139. The Tribunal referenced various precedents, including decisions from other benches and circulars issued by the CBDT, which clarified the interpretation of these provisions. Court's Interpretation and Reasoning The Tribunal interpreted the provisions of Section 139 to include not only the original return filing deadline under Section 139(1) but also the extended deadline under Section 139(4). It reasoned that the amendment to Section 12A(1)(ba), effective from April 1, 2023, was clarificatory and intended to exclude updated returns under Section 139(8). The Tribunal found that the assessee's return, filed within the time allowed under Section 139(4), was compliant with the statutory requirements. Key Evidence and Findings The Tribunal noted that the assessee filed the return of income on February 17, 2017, and Form No. 10 on August 29, 2018. The assessee also submitted a revised computation during assessment proceedings, claiming the exemption under Section 11(2). The Tribunal found that the delay in filing Form No. 10 was procedural and did not affect the substantive compliance with the conditions for exemption. Application of Law to Facts The Tribunal applied the law by considering the return filed within the extended deadline under Section 139(4) as valid for claiming the exemption. It emphasized that procedural delays in filing Form No. 10 should not deny the exemption when substantive conditions were met. The Tribunal relied on the CBDT circulars and judicial precedents that supported this interpretation. Treatment of Competing Arguments The Revenue argued that the exemption should be denied due to the delayed filing of Form No. 10 and the return beyond the Section 139(1) deadline. The Tribunal rejected this argument, citing precedents that treated such procedural delays as non-fatal to the exemption claim. The Tribunal emphasized the clarificatory nature of the amendments and circulars, which supported the assessee's position. Conclusions The Tribunal concluded that the assessee was entitled to the exemption under Section 11(2) as the return was filed within the permissible time under Section 139(4), and the delay in filing Form No. 10 was procedural. The Tribunal directed the Revenue to allow the exemption claimed by the assessee. SIGNIFICANT HOLDINGS Preserve Verbatim Quotes of Crucial Legal Reasoning The Tribunal held, "The return filed by the assessee is to be treated as filed within the time allowed u/s 139 of the Act, which includes the return filed u/s 139(1) as well as return of income filed u/s 139(4) of the Act." Core Principles Established The Tribunal established that procedural delays, such as late filing of Form No. 10, should not impede the granting of exemptions under Section 11(2) when substantive conditions are met. The interpretation of Section 139 includes both the original and extended deadlines, supporting a broader understanding of compliance. Final Determinations on Each Issue The Tribunal determined that the assessee's return, filed within the extended deadline, was valid for claiming the exemption. The procedural delay in filing Form No. 10 did not warrant denial of the exemption. The Tribunal dismissed the Revenue's appeal, upholding the CIT(A)'s decision to allow the exemption.
|
