ASSISTANT COMMISSIONER OF INCOME TAX, DELHI V. TALBOTFORCE SERVICES PRIVATE LIMITED, DELHI

ITA 4885/DEL/2024

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The case revolves around the denial of a deduction claimed under section 80-IAC of the Income Tax Act, 1961 by Talbotforce Services Pvt. Ltd., a company recognized as a startup. The company claimed a deduction of INR 5,76,83,963 in its return for the assessment year 2023-24, which was initially denied by the DDIT, CPC, Bengaluru due to the non-submission of the Audit Report in Form 10CCB by the due date. The CIT(A) reversed this decision, noting that the assessee had faced a technical issue preventing the timely online submission of the form, despite having obtained the report before the deadline. The Tribunal upheld the CIT(A)'s decision, agreeing that the delay was beyond the assessee's control and that the provisions regarding the submission of Form 10CCB are directory, not mandatory.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 34233 (ITAT-DELHI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-02-2025
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: H
• Assessment Year: 2023-2024
• Other Referred Cases: Sanjay Kukreja, New Delhi vs ACIT, Circle-54(1), New Delhi in ITA No.652/Del/2023
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AMIT KATOCH
• Assessee Lawyers: HARSHIT SRIVASTAVA; ANKUR
• Section: 250; 143(1); 139(1)

Judgement Text

"ITA No.4885/Del/2024 Page | 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI “E” BENCH: NEW DELHI BEFORE SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER & SHRI SUDHIR PAREEK, JUDICIAL MEMBER ITA No.4885/Del/2024 [Assessment Year : 2023-24] ACIT Delhi vs Talbotforce Services Pvt.Ltd. Unit No.-305-310, Plot No.9,10, 11, Vardhman Trade Center, Nehru Place Delhi-110019 PAN-ABCCS8388R APPELLANT RESPONDENT Appellant by Shri Amit Katoch, Sr. DR Respondent by Shri Harshit Srivastava, CA & Shri Ankur, CA Date of Hearing 24.02.2025 Date of Pronouncement 24.02.2025 ORDER PER PRADIP KUMAR KEDIA, AM : The instant appeal has been filed at the instance of the Revenue seeking to assail the First Appellate order dated 19.09.2024 passed by ADDL/JCIT(A)- 2, Bengaluru [“CIT(A)”] under s. 250 of the Income Tax Act, 1961 [“the Act”] arising from the order dated 31.10.2023 passed under s. 143(1) of the Act pertaining to assessment year 2023-24. 2. The Revenue has raised following ground of appeal:- 1. “Whether, on the facts and circumstances of the case and in law the Ld. Addl/JCIT(A)-2, Bengaluru has erred in deleting the addition of Rs.5,76,83,963/- on account of disallowance u/s. 80IAC of the Income Tax Act, however the assessee has not filed Form 10CCB before the due date for fling of return of income u/s 139(1) of the Income Tax Act.” 3. Briefly stated, the captioned assessee is a Private Limited Company holding Certificate of Recognition as a START UP by the Department for Promotion of Industry and Internal Trade vide certificate No.DIPP49016 dated ITA No.4885/Del/2024 Page | 2 15.01.2020. The assessee company also holds a certificate of eligible business under s. 80-IAC of the Act and it is carrying on variety of services such as Manpower Services, Homecare Services, Building Upkeep and Management etc. The assessee company filed its return of income on 30.09.2023 for AY 2023-24 declaring total income at INR 58,238/- after claiming deduction of INR 5,76,83,963/- under s. 80-IAC. While processing the return of income under s. 143(1) of the Act dated 28.05.2024 by the DDIT, CPC, Bengaluru the deduction claimed under s.80-IAC was denied on the ground that Audit Report in Form 10CCB was not filed within due date i.e. 30.09.2023. 3. Aggrieved by the denial of deduction claimed under s. 80-IAC, the assessee preferred appeal before the CIT(A). It was submitted before the CIT(A) that Audit Report in prescribed Form 10CCB could not be uploaded due to technical problem persisting on online portal of the Income Tax Department about the due date of filing of said form. The assessee company pointed out that it had obtained an Audit Report dated 28.09.2023 in the prescribed Form from independent C.A Firm before the expiry of the due date i.e. 30.09.2023. Since the assessee was unable to upload the said Audit Report online, the assessee forwarded the said Audit Report alongwith all supporting documents by speed post to the jurisdictional Assessing Officer (JAO). The Audit Report in Form 10CCB could be eventually uploaded online on 05.10.2023 as against due date on 30.09.2023. Hence the delay of 05 days occurred in uploading the Audit Report was beyond the control of the assessee due to technical glitch at the end of the Department and thus denial of relief by the CPC, Bengaluru without considering such aspects is not justified. 4. After taking cognizance of the documentary evidences and the factual matrix such as grievance raised with the Department on 28.09.2023 and service of physical copy of Form 10CCB before the AO, (JAO), e-mail to CPC, Bengaluru on 29.09.2023 etc. the CIT(A) reversed the action of the CPC, Bengaluru and allowed the claim of deduction under s. 80-IAC made by the assessee. ITA No.4885/Del/2024 Page | 3 5. Aggrieved by the relief granted by the CIT(A) the Revenue is in appeal before the Tribunal. 6. We have carefully considered the rival submissions and perused the material available on record. On consideration of the factual matrix narrated above, it is self-evident that the assessee has acted bonafide and did everything possible at his end to upload Form 10CCB within due date to claim deduction under s. 80-IAC of the Act. Failing to upload the prescribed Form 10CCB before the due date, the assessee served the physical copy to the AO (JAO), e-mailed the prescribed Form to CPC, Bengaluru as well as raised the grievance before the Department in this regard. In the wake of these facts, the order of the CIT(A) directing the CPC, Bengaluru to entertain the claim of deduction under s. 80-IAC cannot be faulted by any stretch of imagination. The CIT(A) has referred to large number of judgements in the first appellate order passed under s. 250 of the Act for the proposition that the delay in filing Form 10CCB can be condoned in appropriate circumstances since such provisions are only directory in nature. Including the judgement rendered by the Co-ordinate Bench in the case of Sanjay Kukreja, New Delhi vs ACIT, Circle- 54(1), New Delhi in ITA No.652/Del/2023 order dated 30.01.2024. We see no reason to interfere with the action of the CIT(A) where the assessee was apparently prevented from failing to upload the prescribed form at the portal of the Income Tax Department due to technical glitch in the portal. The grievance of Revenue is thus devoid of any merit. 7. In the result, the appeal of the Revenue is dismissed. Order pronounced in the open Court on 24th February, 2025. Sd/- Sd/- (SUDHIR PAREEK) JUDICIAL MEMBER *Amit Kumar, Sr.P.S* (PRADIP KUMAR KEDIA) ACCOUNTANT MEMBER ITA No.4885/Del/2024 Page | 4 Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI "