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TMI Blog2023 (8) TMI 914X X X X Extracts X X X X X X X X Extracts X X X X ..... th return of income to be a procedural requirement CIT(A) has not appreciated the case of the assessee in the right perspective in the light of various judgments cited by the assessee where it has been held that non-filing of requisite form alongwith return of income is a technical issue, which is curable, and if the assessee has complied with the provisions of the Act in the course of assessment proceedings by curing the defect by filing the audit report, and thereby satisfying substantial compliance, the Revenue cannot ignore the report so filed and reject technically the claim of benefit of exemption under section 11 of the Act, which the assessee was claiming continuously for past so many years, which fact was not disputed by the Dep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has filed its return of income for the impugned assessment year declaring NIL income after claiming exemptions under section 11 of the Act. The CPC, Bangalore by intimation made under section 143(1) of the Act, dated 09-03-2019 denied the same for the reason that the assessee has not filed audit report in Form No.10B on or before filing of the return of income. Immediately thereafter on 11.6.2019, the assessee-trust e-filed audit report and also filed rectification request on 14.6.2019, but the same were rejected by the CPC on 15.7.2019. The action of the CPC was challenged before the ld.first appellate authority, NFAC, Delhi, however, the ld.CIT(A) confirmed order of the CPC and rejected the appeal of the assessee. Hence, the assessee is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) Thus, he submitted that since the assessee has complied with substantial requirement of the provisions of the Act as the assessee in fact did file the audit report in Form No.10B and they were available to the lower authorities during the rectification and the appellate proceedings, denial of claim of exemption benefit under section 11 of the Act by the Revenue authorities on account of procedural lapse was unjust. 6. On the other hand, the ld.DR supported orders of the Revenue authorities, and further submitted that the filing of Form No.10B of the Act was a statutory requirement, and the assessee having failed to comply with the same, the ld.CIT(A) rightly rejected the claim benefit of exemption under section 11 of the Act, and it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th return of income for claiming exemption, held the requirement of furnishing of report to be a mandatory requirement while that of filing the report alongwith return of income to be a procedural requirement. Relevant findings of the Hon ble jurisdictional High Court are as under: 5. Having heard learned advocates for the respective parties and having gone through the material on record, the only question which falls for consideration is whether respondent committed an error in passing the order by not condoning the delay in filing Form No. 10B along with the return filed. In the decision of this Court in Sarvodaya Charitable Trust (supra) this Court has observed that furnishing of audit report along with return filed is to be treated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... read as under: 6. The moot aspect thus centres around to the requirement of the availability of the audit report when the assessment was undertaken by the Assessing Officer even though the same may not have been filed along with the return of income. Filing of audit report is held to be substantive requirement but not the mode and stage of filing, which is procedural. Once the audit report in Form 12B is filed to be available with the Assessing Officer, before assessment proceedings take place, the requirement of law is satisfied. In that view, the Income Tax Tribunal was not justified in dismissing the appeal of the assessee. 6.1 The appellant assessee has to be held to be eligible and entitled to exemptions under Section 11(1) ..... X X X X Extracts X X X X X X X X Extracts X X X X
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