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TMI Blog2023 (12) TMI 1295X X X X Extracts X X X X X X X X Extracts X X X X ..... e Act cannot be so fatal so as to deny they very claim of exemption u/s 11(2) of the Act especially when Form 10 / 10B was available on record when the intimation was passed by CPC u/s 143(1) of the Act - Decided in favour of assessee. - SHRI WASEEM AHMED, ACCOUNTANT MEMBER AND SHRI SIDDHARTHA NAUTIYAL, JUDICIAL MEMBER For the Appellant : Shri Sudhendu Das, CIT DR For the Respondent : Shri Tushar Hemani, Sr. Advocate Shri Parimalsinh B Parmar, A.R. ORDER PER SIDDHARTHA NAUTIYAL, JM : This appeal has been filed by the Revenue against the order passed by the Ld. Commissioner of Income Tax (Appeals), (in short Ld. CIT(A) ), National Faceless Appeal Centre, (in short NFAC ), Delhi in DIN Order No: ITBA/NFAC/S/250/2022-23/1050288250(1) vide order dated 01.03.2023 passed for the Assessment Year 2019-20. 2. The Revenue has raised the following grounds of appeal:- (i) Whether in the facts and in the law, the Ld.CIT(A), !s right in holding that not filing of Form No.10 and / or 10B within due date as prescribed under the Act, is a procedural lapse, ignoring the law laid down by the Hon'ble Supreme Court in the case of M/s. Wipro Ltd. in the Civil Appeal No.1449 of 2022, wherein the Ho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s purposes or in part only for such purposes, or of income being voluntary contributions referred to in sub-clause [iia] of clause [24] of section 2, shall, if the total income in respect of which he is assessable as a representative assessee [the total income for this purpose being computed under this Act without giving effect to the provisions of sections 11 and 12] exceeds the maximum amount which is not chargeable to income-tax, furnish a return of such income of the previous year in the prescribed form and verified in the prescribed manner and setting forth such other particulars as may be prescribed and all the provisions of this Act shall, so far as may be, apply as if it were a return required to be furnished under subsection [1]. Hence, as per the section 139(4A), the time limit to file return of income is the time limit to file return of income u/s 139(1). Further, for A.Y. 2019-20, the extended due date to file return of income was 31.10.2019 and the appellant filed its return of income on 13.03.2020 i.e. belated return. However, the appellant in its submission contended that the return filed on 13.03.2020 is revised return and the original return of income was filed u/s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ate to the assessing authority the particulars required, under rule 17 in Form No. 10. If during the assessment proceedings the Assessing Officer does not have the necessary information, the question of excluding such income from assessment does not arise at all. As a matter of fact, the benefit of excluding this particular part of the income from the net of taxation arises from section 11 and is subject to the conditions specified therein. Therefore, it is necessary that the assessing authority must have this information at the time it completes the assessment. In the absence of any such information, it will not be possible for the assessing authority to give the assessee the benefit of such exclusion and once the assessment is so completed, it would be futile to find fault with the assessing authority for having included such income in the assessable income of the assessee. Therefore, even assuming that there is no valid limitation prescribed under the Act and the Rules, even then it is reasonable to presume that the intimation required under section 11 has to be furnished before the assessing authority completes the concerned assessment because such requirement is mandatory and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng benefit under Section 10B, both conditions of furnishing declaration to AO in writing and to file same before due date of filing original return of income under Section 139(1), are mandatory in nature, thus, assessee would not be entitled to benefit under Section 10B(8) on noncompliance of twin conditions as provided under Section 10B(8). 7. In response, the Counsel for the assessee submitted cases in support of the contention that filing of Form 10 is a procedural requirement and further, the case of Wipro Limited supra was rendered on its own set of facts, which are distinguishable from the facts of the assessee s case. In the case of Wipro Limited supra, deduction u/s 10B was claimed in the original return, which was sought to be withdrawn by way of filing of revised return of income. However, it was submitted before us that in the instant facts, the claim of deduction under Section 11(2) of the Act had been filed by the assessee in the original return of income itself, which was filed by the assessee within the due prescribed date along with the Form 10 and similar claim was also filed in the revised return of income filed by the assessee. In this case, the Assessee filed or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Panelboard Mfg. - TA 655 of 2022 (Guj); II. DCIT vs. Cryogas Equipment P. Ltd. - ITA 415/Ahd/2020; III. True Sparrow Systems P. Ltd. vs. PCIT - ITA 765/Ahd/2019; IV. Shardaben Education Trust vs. ITO - ITA 2312/Ahd/2018; V. CIT vs. Xavier Kelavani Mandal P. Ltd. - 221 Taxman 43 (Guj); VI. Zenith Processing Mills vs. CIT - 219 ITR 721 (Guj); VII. CIT vs. Mayur Foundation - 274 ITR 562 (Guj); VIII. CIT vs. Gujarat Oil Allied Industries - 201 ITR 325 (Guj); IX. CIT vs. G. M. Knitting Industries - 376 ITR 456 (SC); X. CIT vs. Web Commerce (India) P. Ltd. - 318 ITR 135 (Del); XI. CIT vs. Contimeters Electricals P. Ltd. - 317 ITR 422 (Del); XII. PCIT vs. Surya Merchants - 387 ITR 105 (Allhabad); XIII. DIC Fine Chemicals P. Ltd. vs. DCIT - 177 ITD 672 (Kol.); 9. Further, we are also an agreement for the Counsel for the assessee that the case of Wipro Limited supra was rendered on a different set of facts, wherein in the original return of income the assessee had claimed benefit under Section 10B of the Act and thereafter, a revised return of income was filed by the assessee foregoing the claim of benefit of Section 10B of the Act. However, the facts of the instant case are clearly distin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... G.M. Knitting Industries (P.) Ltd. (supra), the Hon'ble Supreme Court held that that decision was relevant in the context of deduction provisions and not the exemption provisions as given under Chapter III of the Act. 6.3.1. In our view, the aforesaid decision would not apply to assessee s set of facts and would not preclude / prohibit the assessee from claiming deduction u/s 10AA of the Act, for the following reasons: (i) Firstly, in the case of Wipro Limited supra, the issue for consideration before the Hon'ble Supreme Court was that in the original return of income, the assessee had claimed deduction under section 10B of the Act, whereas in the revised return filed under section 139(5) of the Act, assessee did not claim deduction under section 10B of the Act, and instead claimed benefit of carry forward of losses. It was in light of these facts that the Hon'ble Supreme Court held that on a plain reading of section 10B(8) of the Act, it is clear that where assessee claimed benefit under section 10B(8) by furnishing declaration in revised return much after due date prescribed under section 139(1), same was to be denied as requirement of furnishing declaration before A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... along with the return of income (being a procedural requirement), especially when Form 56F has been filed by the assessee at the assessment stage when such claim was being considered by the Assessing Officer. (iii) Besides the above, in the case of G. M. Knitting Industries (P.) Ltd. case supra, the Hon'ble Supreme Court further held that even though necessary certificate in Form 10CCB along with return of income had not been filed but same was filed before final order of assessment was made, assessee was entitled to claim deduction under section 80-IB of the Act as well. Therefore, in light of the decision of Yokogawa supra (which is held that section 10A of the Act is a deduction provision not an exemption provision ) and the decision of G. M. Knitting Industries case supra, which have been rendered on a similar facts as that of the assessee i.e. claim of deduction was made in the original return of income itself, in our view, the ratio laid down in the Wipro Ltd case would not disentitle assessee to claim benefit of section 10AA of the Act, since it has been rendered on a different set of facts. Therefore in our considered view, once such claim has been made in the original ..... X X X X Extracts X X X X X X X X Extracts X X X X
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