GURUDWARA SHRI GURU SINGH SABHA,DELHI V. ITO (EXEMPTION) WARD 1(2), DELHI

ITA 1878/DEL/2025

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The case involves Gurudwara Shri Guru Singh Sabha, a charitable trust, appealing against the decision of the CPC which denied them exemption under section 11 of the Income-tax Act, 1961, amounting to Rs. 81,30,497 for the assessment year 2020-21. The denial was based on the late filing of Form 10B, which was submitted on 30.03.2021, past its due date of 15.01.2021. The Tribunal considered various precedents where it was established that the filing of Form 10B is directory and not mandatory, and it can be submitted before the finalization of the assessment. The Tribunal thus condoned the delay and allowed the exemption.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 716656 (ITAT-DELHI)
• Duration Of Justice: 4 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-08-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Assessment Year: 2020-2021
• Appeal Filed On: 26-03-2025
• Other Referred Cases: M/s. Shilparamam Arts, Crafts and Cultural Society, Hyderabad v. Asst. CIT, CIT v. Xavier Kelavani Mandal Pvt. Ltd., Delhi Brotherhood Society v. ITO, Puran Chand Arora Charitable Trust v. ITO, Earthing Trust v ITO, Shakuntalam Bal Vikas Society v. ITO, Bhagwant Kishore Memorial Educational Society v. ITO, Commissioner Of Income Tax V. Contimeters Electricals (P) Ltd, Commissioner Of Income Tax V. Arunachalam (A.N.), CIT V. Jayant Patel, CIT Vs. A K S Alloys Pvt. Ltd., Commissioner Of Income Tax And Another Vs. Ace Multitaxes Systems (P) Ltd., Commissioner of Income Tax v. Sivanand Electronics, Zenith Processing Mills v. CIT, CIT V. Mahalaxmi Rice Factory
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANISH GUPTA
• Assessee Lawyers: PRANSHU SINGHAL
• Keywords: Charitable institution; Benefit of exemption
• Section: 11; 10B

Judgement Text

"Page 1 of 6 IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI ‘G’ BENCH, NEW DELHI BEFORE MS. MADHUMITA ROY, JUDICIAL MEMBER, AND SHRI NAVEEN CHANDRA, ACCOUNTANT MEMBER ITA No. 1878/DEL/2025 [A.Y. 2020-21] Gurudwara Shri Guru Singh Sabha Vs. The I.T.O(E) C-Block, Clock Tower Ward – 1(2) Hari Nagar, New Delhi New Delhi PAN – AAAAG 99224 F (Applicant) (Respondent) Assessee By : Shri Pranshu Singhal, CA Department By : Shri Manish Gupta, Sr. DR Date of Hearing : 13.08.2025 Date of Pronouncement : 22.08.2025 ORDER PER NAVEEN CHANDRA, A.M:- This appeal by the assessee is preferred against the order of the ld. CIT(A) , Mumbai dated 11.07.2024 for A.Y 2020-21. 2. The ld. counsel for the assessee has filed an application for condonation of delay. Printed from counselvise.com ITA No. 1878/DEL/2025 [A.Y. 2020-21] Gurudwara Shri Guru Singh Sabha Page 2 of 6 3. Having perused the condonation petition, we find that the assessee has sufficient cause for not filing the appeal in time. Accordingly, we condone the delay and admit the appeal. 4. The sum and substance of the grievance of the assessee is the confirmation of action of the CPC in disallowing assessee the exemption u/s 11 of the Income-tax Act, 1961 [the Act, for short] amounting to Rs. 81,30,497/-. 5. Short facts of the case are that the assessee is running a charitable trust and is carrying charitable activities for so many years. The CPC, while processing the return of income, denied the claim of exemption u/s 11 of the Act, merely on the basis that Form 10B was belatedly filed. 6. Aggrieved, the assessee is in appeal before us. 7. At the very outset, the ld AR argued that the return of Income was filed on 15.01.2021, due date of which is 15.02.2021. He further stated that the Form 10B was filed on 30.03.2021, the due date of which was 15.01.2021. CPC processed the return u/s 143(1) vide the intimation order dated 30.11.2021. The ld AR argued that mere delay in filing Form 10B which is directory and procedural in nature cannot Printed from counselvise.com ITA No. 1878/DEL/2025 [A.Y. 2020-21] Gurudwara Shri Guru Singh Sabha Page 3 of 6 be a reason to deny the exemption of trust. The assessee has relied on the following decisions: • M/s. Shilparamam Arts, Crafts and Cultural Society, Hyderabad v. Asst. CIT, WP No. 31360 of 2023 dated 24.11.2023, Telangana High Court • SLP dismissed by Supreme Court vide SLP No. 34100/2025 dated 04.08.2025 • CIT v. Xavier Kelavani Mandal Pvt. Ltd., 2012:GUJHC:26224-DB • Delhi Brotherhood Society v. ITO, ITA No. 3382/Del/2024 dt. 16.05.2025, ITAT Delhi • Puran Chand Arora Charitable Trust v. ITO, ITA 625/DEL/2024 dt.22.01.2025, ITAT Delhi • Earthing Trust v ITO, ITA 882/Del/2024 dt. 10.01.2025, ITAT Delhi • Shakuntalam Bal Vikas Society v. ITO, ITA 3506/Del/2023 dt. 27.08.2024, ITAT Delhi • Bhagwant Kishore Memorial Educational Society, v. ITO, ITA 3657/Del/2023 dt. 14.08.2024, ITAT Delhi 8. Per contra, the ld. DR relied on the orders of the authorities below. 9. We have heard the rival submissions and have perused the relevant material on record. We find that the CIT(E) has denied the benefit of deduction u/s 11 on the ground that the Form 10B is mandatory and has been filed with a delay and that the delay has not been condoned. We find that there are catena of cases where the hon’ble High Courts have held that the filing of Form 10/audit report is directory and not mandatory and that if the audit report was filed at any time before the Printed from counselvise.com ITA No. 1878/DEL/2025 [A.Y. 2020-21] Gurudwara Shri Guru Singh Sabha Page 4 of 6 framing of the assessment, the requirement of the provisions of the Act should be held to have been met. The hon’ble Delhi High Court in the case in Commissioner Of Income Tax V. Contimeters Electricals (P) Ltd - (2009) 317 ITR 249(Delhi), following the judgements of the Madras High Court in Commissioner Of Income Tax V. Arunachalam (A.N.)- (1994) 208 ITR 481 and in Cit V. Jayant Patel (2001) 248 ITR 199 (Mad) held that the filing of audit report along with the return was not mandatory but directory and that it and may be filed before finalization of assessment. Similar view was adopted by the Hon'ble Madras High Court in the case of CIT Vs. A K S Alloys Pvt. Ltd. 18 Taxman.com 25 and the Karnataka High Court in the case in Commissioner Of Income Tax And Another Vs. Ace Multitaxes Systems (P) Ltd. (2009) 317 ITR 207(Karnataka). That was also the view of the Bombay in Commissioner of Income Tax v. Sivanand Electronics-(1994)209 ITR 63(Bom), and Gujarat High Court in Zenith Processing Mills v. CIT-(1996) 219 ITR 721 and Panjab and Haryana High Court in CIT V. Mahalaxmi Rice Factory (2007) 294 ITR 631. 10. In the instant case, the Form 10B was filed on 30.03.2021 and the return of income was processed on 30.11.2021. We find that the assessee had obtained audit report in Form 10B before filing return of income, however filed the same belatedly but before completion of Printed from counselvise.com ITA No. 1878/DEL/2025 [A.Y. 2020-21] Gurudwara Shri Guru Singh Sabha Page 5 of 6 assessment/processing under section 143(1). The ratios of the above decisions therefore squarely applies to the facts of the case. We therefore, hold that filing of audit report in Form 10B before the due date for filing of return of income u/s 139(1) being only directory, the same may be accepted and benefit of exemption under section 11 may not be denied to assessee-trust. The delay in filing the Form 10B be condoned and we direct the A.O./CPC to allow exemption u/s 11 of the Act. Accordingly, the Grounds of Appeal of the Assessee are allowed. 11. In the result, the appeal of the assessee in ITA No. 1878/DEL/2025 is allowed. The order is pronounced in the open court on 22.08.2025. Sd/- Sd/- [MADHUMITA ROY] [NAVEEN CHANDRA] JUDICIAL MEMBER ACCOUNTANT MEMBER Dated: 22nd AUGUST, 2025. VL/ Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) Asst. Registrar, 5. DR ITAT, New Delhi Printed from counselvise.com ITA No. 1878/DEL/2025 [A.Y. 2020-21] Gurudwara Shri Guru Singh Sabha Page 6 of 6 Sl No. PARTICULARS DATES 1. Date of dictation of Tribunal Order . 2. Date on which the typed draft Tribunal Order is placed before the Dictation Member 3. Date on which the typed draft Tribunal Order is placed before the other Member 4. Date on which the approved draft Tribunal Order comes to the Sr. P.S./P.S. 5. Date on which the fair Tribunal Order is placed before the Dictating Member for pronouncement 6. Date on which the signed order comes back to the Sr. P.S./P.S 7. Date on which the final Tribunal Order is uploaded by the Sr. P.S./P.S. on official website 8. Date on which the file goes to the Bench Clerk alongwith Tribunal Order 9. Date of killing off the disposed of files on the judiSIS portal of ITAT by the Bench Clerks 10. Date on which the file goes to the Supervisor (Judicial) 11. The date on which the file goes for xerox 12. The date on which the file goes for endorsement 13. The date on which the file goes to the Superintendent for checking 14. The date on which the file goes to the Assistant Registrar for signature on the Tribunal order 15. Date on which the file goes to the dispatch section 16. Date of Dispatch of the Order Printed from counselvise.com "