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2023 (7) TMI 562 - AT - Income TaxDeduction u/s. 80-IA - assessee filed Form 10CCB beyond the prescribed date - CIT(A) held that filing of report of audit in form 10CCB within due prescribed time is a mandatory requirement, and since the assessee failed to do so confirmed disallowance made by AO - HELD THAT - Recently, in the case of DCIT vs. Croygas Equipments Pvt. Ltd. 2023 (7) TMI 166 - ITAT AHMEDABAD have dealt aspect of whether benefit u/s. 10AA of the Act could be denied to the assessee if the assessee failed to fill Form 56F along with return of income, which however was subsequently filed by the assessee before the Assessing Officer, before the conclusion of assessment. Further, in this case, also distinguished the decision of Wipro Ltd. supra 2022 (7) TMI 560 - SUPREME COURT which was rendered by the Hon ble Supreme Court on a different set of facts. As relying on S.A. Himnani Distributors (P.) Ltd. 2014 (7) TMI 783 - GUJARAT HIGH COURT held such deduction cannot be denied on account of a procedural/technical default by the assessee CIT(A) has erred in facts and in law in not allowing the claim of the assessee on the ground that benefit of section 80-IA of the Act is not available to the assessee if the assessee does not e-file Form 10CCB along with return of income when the assessee admittedly furnished From 10CCB, prior the return of income filed by the assessee being processed by the Department u/s. 143(1) - Decided in favour of assessee.
Issues Involved:
1. Validity of NFAC's Order 2. Disallowance of Deduction under Section 80IA 3. Powers of CPC in Disallowing Deduction under Section 80IA 4. Consideration of Assessee's Submission by NFAC 5. Charging of Interest under Section 234C Summary: 1. Validity of NFAC's Order: The assessee contested that the order passed by the National Faceless Appeal Centre (NFAC) is "bad in law and required to be quashed." 2. Disallowance of Deduction under Section 80IA: The NFAC disallowed the deduction under Section 80IA amounting to Rs. 19,39,565, citing the late filing of Form 10CCB. The assessee argued that this procedural lapse should not lead to the withdrawal of the deduction without verification. The NFAC upheld the disallowance, stating that "filing of report of audit in form 10CCB within due prescribed time is a mandatory requirement," and since the assessee failed to meet this requirement, the deduction was rightly disallowed. 3. Powers of CPC in Disallowing Deduction under Section 80IA: The assessee argued that the Centralized Processing Centre (CPC) exceeded its powers under Section 143(1) by disallowing the deduction. However, the NFAC and CIT(A) maintained that the CPC acted within its authority, as the filing of Form 10CCB after the due date justified the disallowance. 4. Consideration of Assessee's Submission by NFAC: The assessee contended that the NFAC should have considered their submissions and allowed the deduction claimed in the return of income. The NFAC dismissed this contention, reiterating that the procedural requirement of timely filing Form 10CCB was not met, thus justifying the disallowance. 5. Charging of Interest under Section 234C: The assessee argued that charging interest under Section 234C was not justified. However, this issue was not elaborated upon in the judgment. Tribunal's Decision: The Tribunal observed that the filing of Form 10CCB is a procedural requirement and not a mandatory one. They cited several judicial precedents, including recent rulings by the Ahmedabad Tribunal and the Supreme Court, which support the view that procedural lapses should not deny the benefit of deductions if the substantive conditions are met. The Tribunal concluded that the NFAC erred in not allowing the deduction, as the assessee had filed Form 10CCB before the return of income was processed by the CPC. Therefore, the appeal of the assessee was allowed, and the order of the NFAC was set aside. Conclusion: The appeal was allowed, and the assessee was granted the deduction under Section 80IA, as the procedural lapse of late filing Form 10CCB should not lead to the denial of the deduction. The Tribunal emphasized the principle of liberal interpretation of beneficial provisions.
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