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2014 (11) TMI 408 - AT - Income TaxRejection of Form No. 10 in course of reassessment proceeding - Whether the Form No. 10 filed by assessee is not filed during reassessment proceeding – Held that:- Assessee itself in the return of income has computed the excess income accumulated/set apart and AO has allowed exemption to assessee while completing the original assessment after examining the same - exemption claimed by assessee, in fact, was allowed by AO and it was never pointed by AO to assessee that due to non filing of Form No. 10 assessee’s claim of exemption will not be accepted - when the assessment was reopened for disallowing assessee’s claim of exemption u/s 11 in respect of excess income accumulated/set apart for non-furnishing of Form No. 10, assessee became aware of it and furnished Form No. 10 before AO in course of reassessment proceeding - assessment was not reopened on the basis of information subsequently filed by assessee claiming benefit of section 11 after completion of original assessment. Assessee has claimed accumulation/setting apart excess income in the return of income filed originally and AO also accepted such claim of assessee while completing the original assessment - AO never raised the issue of non-filing of Form No. 10 nor he rejected assessee’s claim of exemption u/s 11 in respect of accumulated income - Therefore, there was no occasion for assessee earlier to file Form No. 10 - when assessment was reopened for assessing escaped income on account of non furnishing of Form No. 10, it can be said that furnishing of Form No. 10 is relatable to escaped income sought to be assessed - Accumulation/setting apart of excess income is already disclosed/shown by assessee in the return of income originally filed and was also examined and allowed by AO while completing the assessment. Neither it is a fresh claim made by assessee which was not before AO during the original assessment nor it is a claim rejected by AO during original assessment, and reagitated by assessee during the assessment proceeding - assessee did not furnish form No. 10 along with the return of income, but, were furnished during proceeding initiated u/s 147 of the Act- Following the decision in ASSOCIATION OF CORPORATION & APEX SOCIETIES OF HANDLOOMS Versus ASSISTANT DIRECTOR OF INCOME TAX [2013 (1) TMI 317 - DELHI HIGH COURT] - the AO is directed to accept Form No. 10 filed by assessee and allow the benefit in terms of section 11(2) read with Rule 17 – Decided in favour of assessee.
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