2023 (4) TMI 1428 - HC - Income Tax

Disallowance of deduction u/s 80IC - non submission of Form 10CCB along with the Return - HELD THAT - Tribunal in our view rightly took note of the decision of G.M. Knitting Industries Pvt. Ltd. 2015 (11) TMI 397 - SC ORDER and held that a mere procedural irregularity is not fatal to claim deduction u/s 80IC of the Act. In the case of M/s. Winro Commercial (India) Ltd. 2022 (11) TMI 1178 - CALCUTTA HIGH COURT this Court had considered the similar issue where the assessee failed to attach the audit report of claim deduction along with the Return of income. That being only a procedural lapse the Court held that the assessee cannot be non-suited on the said ground. The decision in the case of Contimeter Electricals Private Limited 2008 (12) TMI 4 - HIGH COURT DELHI and Murali Export House 1995 (8) TMI 4 - CALCUTTA HIGH COURT were referred to. Decided in favour of the assessee.

Summary

The Calcutta High Court, in an appeal under Section 260A of the Income Tax Act, 1961, upheld the Income Tax Appellate Tribunal's order deleting the addition made by the revenue for disallowance of deduction under Section 80-IC. The key legal issue was whether non-submission of Form 10CCB with the return could justify denial of the Section 80-IC deduction. Relying on the Supreme Court's ruling in *C.I.T vs. G.M. Knitting Industries Pvt. Ltd.*, 376 ITR 456, the Court held that "a mere procedural irregularity is not fatal to claim deduction under Section 80-IC." The Court further referenced analogous precedents, including *M/s. Winro Commercial (India) Ltd. vs. Principal Commissioner of Income Tax*, ITAT 237 of 2022, and decisions from Delhi and Calcutta High Courts, emphasizing that procedural lapses cannot defeat substantive claims for deduction. Consequently, the Court affirmed the Tribunal's decision in favor of the assessee and dismissed the revenue's appeal and stay application.