TMI Blog2023 (3) TMI 765X X X X Extracts X X X X X X X X Extracts X X X X ..... return of income within due date specified under section 139(4) and also filed Form No. 10 electronically before completion of assessment, assessee could not be denied exemption under section 11. Accordingly, in view of the above discussion, delay in filing Form 10-B would not have any impact on the assessee s claim of deduction u/s 11 and 12 of the Act. Whether delay in filing the return of income beyond the due prescribed date would impact the claim of exemption to the assessee under section 11 and 12 of the Act? - In the instant facts, the due date of filing of return of income u/s 139(1) of the Act was 15- 02-2021, while the assessee filed return of income on 18-03-2021. Accordingly, admittedly there is a delay in filing return of income on part of the assessee. However, the CBDT vide Circular CBDT F. No.173/193/2019 ITA I dated 23.04.2019 has clarified with regard to the time allowed for filing of the return of income subsequent to the insertion of clause (ba) in sub section (1) of section 12A of the IT Act which includes the IT return filed within the time allowed u/s. 139 of the Act. Notably, in the case of Conference of Religious India [ 2022 (10) TMI 1158 - ITAT D ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /or modify the grounds of appeal. 3. The brief facts of the case are that the assessee is a public charitable trust duly registered under the provisions of Mumbai Trust Act, 1950 and Section 12A of the Income Tax Act, 1960. For the year under consideration, the assessee e-filed its return of income on 10-02-2021 declaring total income and expenditure as under:- 2. For the assessment year under consideration the appellant e-filed its return of income on 10/02/2021 declaring therein income and expenditures as under: Particulars Amount (Rs.) Voluntary contribution other than corpus fund 12,000 Income u/s 11/12 13,93,398 Gross Income 14,05,398 Less: Total Deductions / Exemptions claimed u/s 11 (12,72,788) ---------- Net Total Income 1,32,610 The CPC while processing u/s. 143(1) of the Act denied the claim of deduction of the assessee u/s. 11 of the Act on the ground that the assessee failed to furnish ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... provide that said report of audit of the accounts of a trust or institution shall be in Form No. 108 As per the provisions of Section 12A(b) of the Income Tax Act, 1961, and under Rule 17B of the Income Tax Rules, Audit Report in Form 108 has to be filed along with the return of income for the relevant year. However, in appellant's case, the delay in furnishing of Form 10B stands condoned as on date, by the order of CIT(Exemption), cited supra. 4.5 Further, as per sub section (9) of Section 13, twin conditions are imposed on the assessee seeking exemption under section 11/12, whereby the return of income as well as the Audit Report are ought to be filed within the prescribed due date u/s 139(1) of the Act. The relevant provisions of the Act are extracted as under: Section 11 not to apply in certain cases Section 13 (9) Nothing contained in sub-section (2) of section 11 shall operate so as to exclude any income from the total income of the previous year of a person in receipt thereof if (i)the statement referred to in clause (a) of the said sub-section in respect of such income is not furnished on or before the due date specified under sub-section (1) of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx 4.9. Regarding the contention that the Gross receipts should not be taxed and expenditure claimed should be allowed, it is pertinent to note that processing of return u/s 143(1) does not envisage examination of such alternate pleas and unless and until a claim is validly made in the return, no such relief can be granted under section 143(1) of the Act. Since the appellant had failed to furnish the return of income within the prescribed time limit u/s 139(1), in the absence of any condonation thereof by the appropriate authority in exercise of powers granted u/s 119(2) of the Act, claim of exemption under section 11 and 12, would automatically stand negated u/s 143(1) of the Act. 4.10. It may be pertinent to quote the Hon'ble Bombay High Court in the case of Commissioner of Income-tax v. Shivanand Electronics 209 ITR 63 to emphasis the point : When the Legislature casts a duty on the assessee claiming certain benefit, to comply with requirements which are associated with suc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 13(9) of the Act are not applicable to the assessee s set of facts. Accordingly, the ld. CIT(A) erred in not appreciating that section 13(9) of the Act does not apply to the entire section 11 and its applicability is limited only to section 11(2). However, the assessee did not make any claim of deduction/accumulation u/s. 11(2) of the Act. Further, since the delay in filing appeal has been condoned by CIT(Exemption), no question of invoking section 12A(b) arises. In the alternative, the counsel for the assessee submitted that the provisions of section 143(1) of the Act do not encompass within its scope disallowance of expenditure claimed by the assessee in its computation of income. Accordingly, even if it were to be assumed that the assessee is not eligible to claim deduction u/s. 11 of the Act, even otherwise the expenses claimed by the assessee cannot be denied u/s. 143(1) of the Act. Finally, the counsel for the assessee agreed that CPC processed the order u/s. 143(1) without prior intimation to the assessee as to which specific adjustment so made by the assessee is in contravention of the first and second proviso to sub-section (1) of section 143. Accordingly, the order p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee had filed return of income within due date specified under section 139(4) and also filed Form No. 10 electronically before completion of assessment, assessee could not be denied exemption under section 11. Accordingly, in view of the above discussion, delay in filing Form 10-B would not have any impact on the assessee s claim of deduction u/s 11 and 12 of the Act. 6.2 The second issue for consideration is whether delay in filing the return of income beyond the due prescribed date would impact the claim of exemption to the assessee under section 11 and 12 of the Act. In the instant facts, the due date of filing of return of income u/s 139(1) of the Act was 15- 02-2021, while the assessee filed return of income on 18-03-2021. Accordingly, admittedly there is a delay in filing return of income on part of the assessee. However, the CBDT vide Circular CBDT F. No.173/193/2019 ITA I dated 23.04.2019 has clarified with regard to the time allowed for filing of the return of income subsequent to the insertion of clause (ba) in sub section (1) of section 12A of the IT Act which includes the IT return filed within the time allowed u/s. 139 of the Act. Notably, the Delhi ITAT in t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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