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2019 (8) TMI 363 - HC - Income TaxDisallowance of accumulation of income under Section 11(2) - Non-filing of audit report in Form 10CCB to claim - no assessment under Section 143(3) - Held that - Under the facts and circumstances of the case, more particularly when there was no assessment under Section 143(3) of the Act and the fact that the assessee has separately filed Form No.10 along with the Board Resolution, along with the covering letter dated 01.04.2009, it is a fit case where the assessing officer should be directed to take note of Form No.10 accompanied by the Board Resolution and take a decision on merits. As we have taken a decision on the assessee's entitlement to file Form No.10, the substantial questions of law, which have been framed by the assessee are not required to be answered and are left open. For the above reasons, the appeal is allowed and the order passed by the Tribunal as well as the CIT (A) are set aside and the order passed by the Deputy Director of Income Tax (Exemptions)-II dated 28.03.2011 is also set aside. The authority is directed to take note of the Form No.10 and the Board Resolution and take a decision on merits and in accordance with law.
Issues:
1. Admission of appeal filed belatedly by the Appellate Tribunal. 2. Non-admission of appeal filed belatedly by the Appellate Tribunal. 3. Entitlement to file Form No.10 for accumulation of funds under Section 11(2) of the Income Tax Act. Issue 1: Admission of Appeal filed belatedly The appeal raised questions on the correctness of the Appellate Tribunal's decision not to admit the appeal filed belatedly. The Tribunal's discretionary powers were questioned for not considering reasonable cause for the delay in filing the appeal. The appellant argued that the Tribunal overlooked relevant legal principles and made perverse findings. The Tribunal's failure to recognize its power to entertain Form No.10 for granting deemed application of income under Section 11 was also challenged. Issue 2: Non-admission of Appeal filed belatedly The Trust, as the assessee, filed a return of income for the assessment year 2008-09 but later realized a mistake regarding Form No.10 for accumulation of funds under Section 11(2) of the Act. The Deputy Director of Income Tax rejected the request for revision under Section 154, citing the belated filing of Form No.10 beyond the time limit allowed under Section 139(9). The Commissioner of Income Tax Appeals upheld this decision, emphasizing the mandatory requirement of filing Form No.10 before the due date for claiming accumulation of income. The Tribunal dismissed the appeal due to unexplained delay, leading to the present appeal before the High Court. Issue 3: Entitlement to file Form No.10 The High Court examined relevant legal precedents, including "CIT -Vs- Sakal Relief Fund" and "CIT -Vs- AKS Alloys Pvt Ltd," which supported the filing of Form No.10 during reassessment proceedings for claiming benefits under Section 11(2) of the Act. The Court also referenced various judgments to affirm the importance of timely submission of necessary forms for tax benefits. Considering the absence of assessment under Section 143(3) and the timely filing of Form No.10 by the assessee, the High Court directed the assessing officer to consider the Form No.10 and Board Resolution for a decision on merits, setting aside previous orders. In conclusion, the High Court allowed the appeal, overturning the Tribunal and CIT (A) decisions, directing the authority to consider the Form No.10 and Board Resolution for a decision in accordance with the law.
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