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2023 (4) TMI 1158 - AT - Income TaxCondoning the delay in filing of Form 10B - assessee has not filed the audit report electronically - HELD THAT - As non-compliance of filing Form 10B along with return of income electronically, the assessee failed to show reasonable cause which prevented to file the same along with the return of income. Therefore, we find no infirmity in the order of CIT(A) and it is justified. Thus, ground No. 1 raised by the assessee is dismissed. Exemption u/s 11(1B) - We note that there is no dispute with regard to showing the said amount as chargeable to tax by the assessee in the return of income and also for non-filing of Form 10B electronically along with return of income. The said amount was treated as income by the CPC as well as by CIT(A). Having no submissions rebutting the findings of CIT(A) in this regard, we deem it proper to uphold the order of CIT(A) in holding an amount as income chargeable to tax u/s. 11(1B) of the Act. Therefore, we agree with the reasons recorded by the CIT(A). Application of money consequential, to filing of Form 10B electronically along with the return of income - As we upheld the order of CIT(A) in dismissing ground No. 1 that no Form 10B was filed by the assessee. In the view of the same, the assessee is not entitled to claim amount in this regard as application of money. Appeal of assessee is dismissed.
Issues Involved:
1. Delay in filing of Form 10B and its condonation. 2. Treatment of Rs. 32,91,450 as income chargeable to tax under Section 11(1B) of the Income Tax Act. 3. Non-treatment of Rs. 59,85,081 as application of money. Issue-wise Detailed Analysis: 1. Delay in Filing of Form 10B and Its Condonation: The primary issue raised by the assessee was the CIT(A)'s refusal to condone the delay in filing Form 10B. The assessee, a charitable trust, filed its return of income late, declaring a total income of Rs. Nil, which was processed, resulting in a determination of total income at Rs. 40,93,280 due to non-filing of Form 10B. The assessee contended that the delay in filing Form 10B was due to reasons beyond its control and had requested the CIT(Exemption) to condone the delay, which was rejected. The CIT(A) upheld this decision, referencing Circular No. 2/2020 by CBDT, which mandates the filing of Form 10B along with the return of income for claiming deductions under Sections 11 and 12. The CIT(A) noted that the assessee did not provide a valid reason for the delay and failed to submit the audit report electronically, thereby justifying the denial of the exemption. The Tribunal agreed with the CIT(A)'s reasoning, stating that the assessee did not show reasonable cause for the delay and upheld the decision to deny the exemption. 2. Treatment of Rs. 32,91,450 as Income Chargeable to Tax Under Section 11(1B) of the Income Tax Act: The second issue concerned the inclusion of Rs. 32,91,450 as income chargeable to tax under Section 11(1B). The assessee did not dispute the inclusion of this amount as chargeable to tax in its return of income and also failed to file Form 10B electronically. Both the CPC and CIT(A) treated this amount as income. The Tribunal, finding no submissions rebutting the CIT(A)'s findings, upheld the decision to treat Rs. 32,91,450 as income chargeable to tax under Section 11(1B). 3. Non-treatment of Rs. 59,85,081 as Application of Money: The third issue was the CIT(A)'s refusal to treat Rs. 59,85,081 as an application of money. The CIT(A) observed that the claim for application of income was contingent on the filing of Form 10B electronically along with the return of income. Since the assessee had not filed Form 10B, it was not entitled to claim this amount as an application of money. The Tribunal agreed with the CIT(A)'s reasoning and upheld the decision to deny this claim. Conclusion: The Tribunal dismissed the appeal of the assessee, upholding the CIT(A)'s decisions on all grounds. The delay in filing Form 10B was not condoned due to the lack of a valid reason, Rs. 32,91,450 was correctly treated as income chargeable to tax under Section 11(1B), and Rs. 59,85,081 was rightly not treated as an application of money due to the non-filing of Form 10B. The order was pronounced in the open court on 02nd March, 2023.
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