2025 (5) TMI 1312 - AT - Income Tax

Denial of benefit of sections 11 and 12 - non-filing of Form No.10B within the prescribed time limit - directory v/s mandatory obligation - as submitted Form No.10B filed at the later stage which was filed at the appellate proceedings - HELD THAT - We note that in the case of S.M. K.R. Vashi High School 2023 (12) TMI 711 - ITAT SURAT has held that even if the Form No.10B could not be uploaded due to some technical error on the income-tax portal benefit of section 11 could not be denied merely on account of delay in furnishing the audit report. Also in the case of CIT (Exemption) Anjana Foundation 2024 (10) TMI 664 - GUJARAT HIGH COURT has held that filing of Form No.10B is a procedural requirement and benefit of section 11 should not be denied for delay in furnishing Form No.10B. We therefore hold that the assessee holding valid registration u/s.12A of the Act has filed Form No.10B belatedly but during the appeal proceedings itself and filing of such report is directory and not mandatory therefore benefit of sections 11 and 12 claimed by the assessee in income-tax return deserves to be allowed. Grounds of appeal raised by the assessee are allowed.

Summary

The Appellate Tribunal (ITAT Pune) allowed the assessee's appeal for A.Y. 2014-15 against the order denying benefits under sections 11 and 12 of the Income-tax Act, 1961 due to late filing of Form No.10B. The assessee held valid registration under section 12A and submitted Form No.10B belatedly during appellate proceedings. The Tribunal relied on precedents including S.M. K.R. Vashi High School v. ITO (157 taxmann.com 702) and CIT (Exemption) Anjana Foundation (168 taxmann.com 462), where it was held that filing Form No.10B is a procedural, directory requirement and delay cannot justify denial of exemption benefits. The Tribunal held: "filing of such report is directory and not mandatory as held by Hon'ble Courts," and thus allowed the benefit of sections 11 and 12. The appeal was allowed accordingly.