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TMI Blog2024 (9) TMI 1272X X X X Extracts X X X X X X X X Extracts X X X X ..... me limit prescribed u/s. 139(1) of the Act. For this, assessee has raised various grounds which are factual, argumentative and hence, need not be reproduced. 3. Brief facts of the case are that the assessee filed e-return of income on 09.02.2019 for the relevant assessment year 2018-19 in Form No. 7 ITR declaring total income at 'nil' after claiming exemption u/s. 11 of the Act. The return of income was processed u/s. 143(1) of the Act and the accounts of the assessee are audited u/s. 12A(b) of the Act and claim was made in audit report in Form No.10B. Subsequently, the assessee's case was selected for scrutiny assessment through CASS for verification of expenditure for charitable/religious purposes and accordingly, notice u/s. 143(2) of the Act was issued on 22.09.2019. The assessee submitted details, documents in respect to notice issued u/s. 142(1) of the Act. The AO after verification from the details and documents uploaded by the assessee trust, noted that the assessee trust has declared income from aggregate receipts excluding voluntary contribution of Rs. 79,92,658/- and after application of income of Rs. 68,60,701/-, balance of Rs. 79,92,658/- was claimed as exempt u/s. 11 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tentions and gone through facts and circumstances of the case. Before us, the ld.AR for the assessee Ms.Pavithra Mucherla, Chartered Accountant, made argument that the only reason for disallowance of claim of exemption u/s. 11 of the Act was that return of income was filed belatedly but within the time stipulated u/s. 139(4) of the Act. She admitted that this return was not filed within the prescribed time u/s. 139(1) of the Act. She stated that the relevant assessment year involved is 2018-19 and the return of income was filed as e-return on 09.02.2019 along with audit report in Form No.10B as required u/s. 12A(b) of the Act. She stated that the entire details for claim of exemption u/s. 11 of the Act was filed before the AO. She further stated that the CIT(A) has relied on the Finance Act, 2017 wherein the provisions of section 12A & 12AA of the Act was amended and according to CIT(A), the Finance Act, 2017 has put two more additional conditions which provides for mandatory filing of return within the time allowed as third condition u/s. 12 of the Act. The CIT(A) reproduced the amended provision which are applicable from 01.04.2018 i.e. for and from AY 2018-19 and the relevant re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... such income of the previous year in the prescribed form and verified in the prescribed manner and setting forth such other particulars as may be prescribed and all the provisions of this Act shall, so far as may be, apply as if it were a return required to be furnished under sub-section (1)," 4.3 The ld.AR argued that the CIT(A) failed to consider Circular No.2/2018 issued vide F.No.370142/15/2017-TPL dated 15.02.2018 explaining Finance Act, 2017 and the explanatory notes to the provisions of the Finance Act, 2017 and subsequent clarification issues by CBDT in F.No.173/193/2019-ITA-I dated 23.04.2019 with reference to time allowed for filing of return of income, subsequent to insertion of clause (ba) in sub-section 1 of section 12A of the Act. She produced the relevant copy of Circular No.2/2018, wherein the Explanatory notes to the provisions of Finance Act, 2017 was explained as under:- "15.4 Further, as per the provisions of said section, the entities registered under section 12AA are required to file return of income under sub-section (4A) of section 139 of the Income-tax Act, if the total income without giving effect to the provisions of sections 11 and 12 exceeds the maxim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as been denied to otherwise eligible trust, thereby creating huge demand. 2. In the matter, the memorandum explaining the relevant provisions of the Finance Bill, 2017 reads as under: "as per the existing provisions of said section, the entities registered under section 12AA are required to file return of income under subsection (4A) of section 139, if the total income without giving effect to the provisions of sections 11 and 12 exceeds the maximum amount which is not chargeable to income-tax. However, there is no clarity as to whether the said return of income is to be filed within time allowed u/ s 139 of the Act or otherwise. In order to provide clarity in this regard, it is proposed to further amend section 12A so as to provide for further condition that the person in receipt of the income chargeable to income-tax shall furnish the return of income within the time allowed under section 139 of the Act. These amendments are clarificatory in nature. These amendments will take effect from 1st April, 2018 and will, accordingly, apply in relation to assessment year 201 8-19 and subsequent years." 3. Additionally, an excerpt of circular 02/2018 dated 15.02.2018 "Explanatory ..... X X X X Extracts X X X X X X X X Extracts X X X X
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