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TMI Blog2023 (3) TMI 1374X X X X Extracts X X X X X X X X Extracts X X X X ..... (2) of the Act and the alleged ground of non-filing of audit report along with return of income which was at the best procedural omission, could never to an impediment in law in claiming the exemption. Decided in favour of assessee. - R/TAX APPEAL NO. 655 of 2022 - - - Dated:- 21-3-2023 - HONOURABLE MR. JUSTICE N.V. ANJARIA AND HONOURABLE MR. JUSTICE NIRAL R. MEHTA MS VAIBHAVI K PARIKH (3238) for the Appellant(s) No. 1 MS MAITHILI D MEHTA (3206) for the Opponent(s) No. 1,2 ORAL JUDGMENT (PER : HONOURABLE MR. JUSTICE N.V. ANJARIA) Heard learned senior advocate Mr. Tushar Hemani with learned advocate Ms. Vaibhavi Parikh and learned advocate Mr. Parimalsinh Parmar for the petitioner and learned advocate Ms. Maithi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... after the assessee preferred the appeal before the Tribunal which was dismissed on 22.7.2022, to become order impugned herein. 3.3 This court issued notice for final disposal on 6.12.2022 observing inter alia that the following substantial questions of law arise for consideration. 1. We have heard learned Senior Advocate Mr. Tushar Hemani assisted by Ms. Vaibhavi Parikh for the appellant. He has relied upon judgement delivered by this Court in the case of Commissioner of Income-tax v. Mayur Foundation reported in [2005] 274 ITR 562 (Gujarat) and in the case of Commissioner of Income-tax- IV v. Xavier Kelavani Mandal (P.) Ltd. reported in [2014] 41 taxmann.com 184 (Gujarat) and submitted that there is no change in law from 1/04/1996, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... filed along with return of income is held to be a procedural and therefore directory in nature. (iii) Under the circumstances, even if Form 10B is filed at the later stage, the exemptions under Section 11(1) and 11(2) could not have been denied on that ground. (iv) The tribunal failed to consider facts of the case and also the legal position in relation to requirement of filing audit report in Form 10B. (v) The tribunal has erred in not appreciating that filing of application under Section 119 of the Act for condonation of delay in filing Form 10B is an additional remedy which does not affect the powers of appellate authority in dealing with issue of pertaining to delay in filing Form 10B. (vi) The tribunal erred in referring to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... jarat Oil Allied Industries Ltd. [(1993) 201 ITR 325 (Guj.)], wherein it is held that the provision regarding furnishing of audit report along with the return has to be treated as a procedural provision. It is directory in nature and its substantial compliance would suffice. In that case, the assessee had not produced the audit report along with the return of income, but produced before completion of the assessment. The Punjab and Haryana High Court in CIT Vs. Shahzadanand Charity Trust [(1997) 228 ITR 292] has reiterated the same principle holding that the benefit of exemption should not be denied merely in account of delay in furnishing the same, and it is permissible for the assessee to produce the audit report at a later stage either ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ome, the same was available with the Assessing Officer when he processed the return of income under Section 143(1) of the Act. The conditions for claiming exemption under Section 11 was satisfied. Although the requirement of furnishing report was mandatory, filing thereof is a procedural aspect. Even though the Form 10B was filed at a later stage, when it was part of the record of the Assessing Officer in course of the processing of the return of income, the Assessing Officer could not have denied the exemption claimed by the assessee under Sections 11(1) and 11(2) on the ground that the audit report was not filed. 5.6 The tribunal further committed an error in appreciating the import of Section 119 2(b) of the Act inasmuch as the applic ..... X X X X Extracts X X X X X X X X Extracts X X X X
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