INSTITUTE OF REHABILITATION,. V. EXEMPTION WARD-1(2), DELHI, .

ITA 6443/DEL/2025

AI Insights

The case involves the Institute of Rehabilitation, a society engaged in educating deaf, dumb, and mentally retarded children, which appealed against the orders of the Commissioner of Income-tax (Appeals) concerning the denial of tax exemptions for the assessment years 2017-18 to 2021-22. The primary issues were the non-filing of Form No. 10B within the due dates and the non-disclosure of new approvals in the return for AY 2021-22. The tribunal considered precedents and the procedural nature of the requirements under sections 11 & 12 of the Act, leading to the decision to set aside the CIT(A)'s orders and remand the case for fresh assessment.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 839241 (ITAT-DELHI)
• Duration Of Justice: 4 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-02-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2018-2019
• Appeal Filed On: 11-10-2025
• Other Referred Cases: CIT(Exemption) Vs. Anjana Foundation, Shambhu Dayal Modern School Vs. ITO (Exemption)
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AJAY KUMAR ARORA
• Assessee Lawyers: DISHANT SETHI
• Keywords: Set aside
• Section: 12AA; 12A; 10B; 80G

Judgement Text

"P a g e | 1 6 Appeals Institute of Rehabilitation (AYs: 2017-18 to 2021-22) IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, DELHI BEFORE SHRI ANUBHAV SHARMA, JUDICIAL MEMBER & SHRI MANISH AGARWAL, ACCOUNTANT MEMBER ITA Nos.6442 to 6446/Del/2025 (Assessment Years: 2017-18 to 2021-22) Institute of Rehabilitation C/o IPSO Legal, H-35, 1st Floor, Jangpura Extension, New Delhi 110014 Vs. Exemption, Ward 1(2) Civic Centre, New Delhi 110002 \u0001थायीलेखासं./जीआइआरसं./PAN/GIR No: AAATI4893B Appellant .. Respondent Appellant by : Sh. Dishant Sethi, Adv. Sh. Shyam Sunder, Adv. Respondent by : Sh. Ajay Kumar Arora, Sr. DR Date of Hearing 02.02.2026 Date of Pronouncement 18.02.2026 O R D E R PER ANUBHAV SHARMA, JM: These are appeals preferred by the Assessee against the orders of the Ld. Commissioner of Income-tax (Appeals) (hereinafter referred to as the First Appellate Authority or ‘the ld. FAA’ for short) in appeals filed before Printed from counselvise.com P a g e | 2 6 Appeals Institute of Rehabilitation (AYs: 2017-18 to 2021-22) him against the orders of the ld. Assessing Officer (hereinafter referred to as the Ld. AO, for short) passed u/s 143(1) of the Income-tax Act, 1961 (hereafter referred to as ‘the Act’). Further details of the orders of the lower authorities are as under:- ITA No. & AY Ld. FAA who passed the appellate order Appeal No. & Date of order of the Ld. FAA AO who passed the assessment order & Date of order 6442/D/25 2017-18 CIT(A)/Addl/JCIT- 13, Mumbai DIN & Order No : ITBA/APL/S/250/2025- 26/1079618106(1)s 14.08.2025 ADIT, CPC, Bengalure, u/s 143(1) Dated 16.07.2019 6443/D/25 2018-19 CIT(A)/Addl/JCIT- 13, Mumbai DIN & Order No : ITBA/APL/S/250/2025- 26/1079621625(1) 14.08.2025 ADIT, CPC, u/s 143(1) Dated 26.09.2019 6444/D/25 2019-20 CIT(A)/Addl/JCIT- 13, Mumbai DIN & Order No : ITBA/APL/S/250/2025- 26/1079621625(1) 14.08.2025 ADIT, CPC, u/s 143(1) Dated 26.09.2019 6445/D/25 2020-21 CIT(A)/Addl/JCIT- 13, Mumbai DIN & Order No : ITBA/APL/S/250/2025- 26/1079625820(1) 14.08.2025 ADIT, CPC, Bengalure, u/s 143(1) Dated 30.11.2021 6446/D/25 2021-22 CIT(A)/Addl/JCIT- 13, Mumbai DIN & Order No : ITBA/APL/S/250/2025- 26/1079643444(1) 14.08.2025 ADIT, CPC, Bengalure, u/s 143(1) Dated 23.08.2022 2. Heard and perused the record.The assesse is a society registered on 25.10.1999 and engaged in imparting education for the welfare of deaf and dumb children as well as mentally retarded kids from class 1 to 8. The society Printed from counselvise.com P a g e | 3 6 Appeals Institute of Rehabilitation (AYs: 2017-18 to 2021-22) has been granted registration u/s 12A r.w.s 12AA of the Income Tax Act, 1961 w.e.f Assessment Year 2013-14. Further, the society is also approved for exemption u/s 80G (5)(vi) of the Act for the donation received. As for the years under consideration the exemption was denied for AYs: 2017-18 to 2020-21 as the prescribed Form u/s 10B has not been filed within the due date. As with regard to AY: 2021-22 exemption was denied as the details of new approvals were not mentioned in the return. 3. The orders were passed u/s 143(1) of the Act and assessee had preferred appeals which has been dismissed by the NFAC on the basis of delay in filing of appeals. 4. Ld. DR has submitted that delay is of substantial period and ld. CIT(A) has rightly dismissed the appeals on the basis of delay. 5. We find that as with regard to issue of delay in filing of Form No. 10B relevant to AY: 2017-18 to AY: 2020-21 the law is settled that directions are directory and there cannot be disallowance u/ s 11 & 12 of the Actfor non- filing of audit report in Form 10B, before due date. Hon’ble Supreme Court in CIT(Exemption) Vs. Anjana Foundation (2025) 178 taxman.com 658 (SC) Printed from counselvise.com P a g e | 4 6 Appeals Institute of Rehabilitation (AYs: 2017-18 to 2021-22) has dismissed the SLP of the department on the ground of delay as well as merits thereby sustaining the impugned orders of the Tribunal and Hon’ble High Court of Gujarat wherein it was held that filing of Form 10B is procedural requirement. 5.1 Then with regard to not mentioning of details of registration/approval relevant to AY: 2021-22 the Coordinate Bench in Shambhu Dayal Modern School Vs. ITO (Exemption)(2024) 165 taxmann.com 801 (Delhi- Trib) has held that when original registration u/s 12AA is still active the same protects assessee. 6. In the light of aforesaid discussion coming up to the question of satisfaction with regard reasons for filing delayed appeal before NFAC, we find that assessee is a Trust and operates primarily through its management or employees. After taking into consideration the reasons for delay pointed out we find that assessee through its secretary who had filed affidavit had mentioned that it was only on receipt of the demand orders being passed that thereupon Trust sought assistance of the counsel and after inspection of record came to know of the impugned orders being passed. Assessee has claimed that it was dependent upon one Brijesh Singh who had engaged Printed from counselvise.com P a g e | 5 6 Appeals Institute of Rehabilitation (AYs: 2017-18 to 2021-22) Dinesh Kalra & associates for the tax compliances and Brijesh Singh had given his email in the returns. Brijesh Kumar Singh had died and assessee engaged Suresh Gambhir, CA’s for AY: 2022-23. Thus assesse was not aware of intimations u/s 143(1) of the Act. 7. We find that NFAC has observed that delay is not well explained because associates persons, staff as well as CA’s are only for assistance purpose and whole responsibility of income tax proceedings pertains only to the ‘appellant’. We are of the considered view that these observations made in a given set of circumstances may be relevant in the case of an individual, however, assessee is a corporate body or otherwise a trust which certainly has to completely dependon its office bearers or professional and if there is sufficient justification that any of the persons so associated for tax compliances has failed to discharge duty or due to any exceptional circumstances. like in the present case death of concerned person, assessee’s interest could not be represented, then assessee should be benefitted. More so, in case like this where intimation u/s 143(1) of the Act was passed. 8. In the light of aforesaid the grounds are sustained and the impugned order of ld. CIT(A) are set aside. No purpose will be served restoring issue to Printed from counselvise.com P a g e | 6 6 Appeals Institute of Rehabilitation (AYs: 2017-18 to 2021-22) the files of CIT(A) as the issue involved and discussed above with regard to non-compliance leading to disallowance u/s 11 & 12 of the Act cannot be sustained under law. The issues are restored on the merits to the files of Assessing Officer to consider the Form 10AB and returns of the assesse and proceed to pass fresh assessment orders. The appeals are allowed in aforesaid terms. Order pronounced in the open court on 18.02.2026 Sd/- (Manish Agarwal) Sd/- (Anubhav Sharma) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated 18.02.2026 Rohit, Sr. PS Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI Printed from counselvise.com "