Shri Karni Krupa Education Trust, Godhra V. The ITO, Ward -1, Godhra

ITA 119/AHD/2023

• Counselvise Citation: [2023] 100 COUNSELVISE.COM (IT) 4482 (ITAT-AHMEDABAD)
• Duration Of Justice: 9 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-12-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 26-12-2023
• Assessment Year: 2018-2019
• Appeal Filed On: 01-03-2023
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: FORTHEASSESSEEWHICH
• Assessee Lawyers: SHRIS.N.DIVATIA; .WEHAVECAREFULLYCONSIDEREDTHEORDERPASSEDBYTHEAUTHORITIES

Judgement Text

THEINCOMETAXAPPELLATETRIBUNAL AHMEDABAD“SMC”BENCH Before:ShriWaseemAhmed,AccountantMember ShriKarniKrupa EducationTrust, ShrystiColony-2, DashamaRoadFatak, JafrabadGodhra, Panchmahal-389001 PAN:AARTS0837Q (Appellant) Vs TheIncomeTax Officer, Ward-1, Godhra (Respondent) Assesseeby:ShriS.N.Divatia,A.R. Revenueby:Ms.SaumyaPandeyJain,Sr.D.R. Dateofhearing:27-12-2023 Dateofpronouncement:29-12-2023 आदेश/ORDER Thisisanappealfiledbytheassesseeagainsttheorder dated05-01-2023passedbyNationalFacelessAppealCentre (NFAC),Delhiforassessmentyear2018-19. ITANo.119/Ahd/2023 AssessmentYear2018-19 I.T.ANo.119/Ahd/2023A.Y.2018-19PageNo. ShriKarniKrupaEducationTrust.vs.ITO 2 2.Theonlygrievanceraisedbytheassesseeisthattheld. CIT(A)erredinnotgrantingexemptionu/s11oftheActon thereasoningthattherewasadelayinfilingForm10Bfor morethan365days. 2.1Thenecessaryfactsarethattheassesseeisapublic charitabletrustandengagedincarryingouteducational activities.ItfileditsreturnofincomedeclaringincomeatRs. NILwhichwassubsequentlyrevisedaftermentioningthe detailsoftheauditorsanddateoffurnishingForm10Bin electronicform.However,whileprocessingtherevisedreturn u/s143(1),theexemptionclaimedu/s11oftheActwas deniedintheorderpassedu/s154oftheAct. 3.Aggrievedassesseepreferredanappealbeforetheld. CIT(A)whodismissedthesamewhileobservingasunder: “5.3Ihavegonethroughtherejectionorderofcondonationu/s.119(2)(b) bytheCommissionerofIncomeTax(Exemption),Ahmedabadonthe groundthatthedelayinfilingofformNo10Bismorethan365days. 5.4Hence,IfindthatCommissionerofIncomeTax(Exemption), Ahmedabadhasalreadyapplieditsmindandrejectedthecondonation applicationfiledu/s119(2)(b)oftheIncomeTaxAct. 5.5Theappealfiledbytheappellantis,therefore,dismissedasno reasonablecause/reasonhasbeengivenfordelayinfilingFormNo.10B bymorethan365days. Intheresult,theappealoftheappellantisdismissed.” I.T.ANo.119/Ahd/2023A.Y.2018-19PageNo. ShriKarniKrupaEducationTrust.vs.ITO 3 4.Beingaggrievedbytheorderoftheld.CIT(A),the assesseeisinappealbeforeus. 4.1Theld.ARbeforeusfiledapaperbookrunningfrom page1to36andsubmittedthattherequirementoffilingaudit reportinForm10Bisproceduralinnatureandtherefore exemptionclaimedbytheassesseeu/s11cannotbedenied. Theld.ARinsupportofhiscontentionreliedonthefollowing orders: i.HariGyanPracharakTrustvs.DCITvideITANo. 245/Ahd/2021orderdated16-06-2023. iiShriVishaOswalJainSewaSamajvs.ITOvideITANo. 59/Ahd/2022orderdated11-10-2023 4.2Theld.ARfurthersubmittedthattheCBDTCircularNo. 16/2020dated19 th July,2022hasalsodelegatedthepowerto thePrincipalCommissioner/CommissionerofIncomeTaxto admittheapplicationforthecondonationofdelayu/s119(2) oftheActwithrespecttothedelayinfilingForm10Bfor assessmentyear2018-19andsubsequentassessmentyears onmerit.Accordingly,itwascontendedbytheld.ARthatthe delayshouldbecondoned,andassesseeshouldbegrantedthe exemptionu/s11oftheAct. I.T.ANo.119/Ahd/2023A.Y.2018-19PageNo. ShriKarniKrupaEducationTrust.vs.ITO 4 5.Ontheotherhand,theld.DRcontendedthatthe assesseeforcondoningthedelayinfilingForm10BoftheAct wastomoveanapplicationbeforetheconcernedIncomeTax AuthoritiesinpursuancetotheCBDTCircularwhowere authorizedtocondonethedelayafterconsideringthemeritof thecase.Assuch,theld.ARcannottaketheshelterofCBDT Circulardiscussedaboveintheappealpendingbeforethe ITAT. 5.1Theld.A.R.inhisrejoindersubmittedthatonceitwas foundthattheTribunalhastakenaviewafterreferringthe judgmentofHon’bleGujaratHighCourtinthecases discussedabove,theassesseedidnotprefertoadoptthe alternateremedyavailabletoit. 6.Wehaveheardtherivalcontentionsofboththeparties andperusedthematerialsavailableonrecord.Attheoutset, wenotethatthisTribunalinidenticalfactsandcircumstances inthecaseofHariGyanPracharakTrustvs.DCITvideITANo. 245/Ahd/2021orderdated16-06-2023hasdecidedtheissue infavouroftheassesseebyobservingasunder: “7.Wehavecarefullyconsideredtheorderpassedbytheauthorities belowandthejudgmentpassedbytheHon’bleJurisdictionalHighCourt incaseofAssociationofIndianPanelboardManufacturer(supra)onthe issueinvolved.Whilepassingorderinfavouroftheassessee,theHon'ble JurisdictionalHighCourthasbeenpleasedtoobserveasfollows: I.T.ANo.119/Ahd/2023A.Y.2018-19PageNo. ShriKarniKrupaEducationTrust.vs.ITO 5 “5.6TheTribunalfurthercommittedanerrorinappreciatingthe importofSection1192(b)oftheActinasmuchastheapplication contemplatedhereunderisonlyaremedyfortheassesseewhich couldnotbesaidtobecompulsorilyresortedtobytheassessee. ThecircularNo7/18dated20.12.2018issuedunderSection119of theActcouldnotbe,thereforesaidtohavetakenawaythe appellateremedy. 5.7Thetribunalmisdirecteditselfinyetanotherwaywhenit observedthatTheFinanceAct,2015witheffectfrom1.4.2016,that isfromassessmentyear2016-17changedthelegalposition.There isnosuchchangewhichcouldbesaidtohavealteredthelegal position.Theonlychangeiswithregardtocompulsoryfilingof auditreportinForm10Binelectronicallyformwhichismade mandatoryunderRule12(2)oftheIncomeTaxRules,1962but thereisnochangewithregardtothesubstantivelawaboutflingof auditreportasstatedabove. 6.Themootaspectthatcentresaroundtotherequirementofthe availabilityoftheauditreportwhentheassessmentwas undertakenbytheAssessingOfficereventhoughthesamemaynot havebeenfiledalongwiththereturnofincome.Filingofaudit reportheldtobesubstantiverequirementbutnotthemodeand stageoffiling,whichisprocedural.OncetheauditreportinForm 12BisfiledtobeavailablewiththeAssessingOfficerbefore assessmentproceedingstakeplace,therequirementoflawis satisfied.InthatviewtheIncomeTaxTribunalwasnotjustifiedin dismissingtheappealoftheassessee. 6.1Theappellantassesseehastobeheldtobeeligibleandentitled toexemptionsunderSection11(1)and112)oftheActandthe allegedgroundofnon-filingofauditreportalongwithreturnof incomewhichwasatthebestproceduralomission,couldneverto animpedimentinlawinclaimingtheexemption. 6.2Accordinglythesubstantialquestionsoflawhavetobedecided infavoroftheappellant. 7.Theyareaccordinglydecided.Theappealisallowed.” 8.InviewoftheratiolaiddownbytheHon'bleJurisdictionalHigh CourtholdingthatnonfilingofAuditReportalongwithreturnofincomeis aproceduralomissionandcannotbeanimpedimentinlawinclaimingthe exemption,weallowthisappealcondoningthedelayinfilingtheAudit ReportinFormNo.10B.However,wealsouponcondoningthedelay, restorethemattertothefileoftheLd.CIT(A)topassorderinregardtothe exemptionclaimedbytheassesseestrictlyinaccordancewithlaw. I.T.ANo.119/Ahd/2023A.Y.2018-19PageNo. ShriKarniKrupaEducationTrust.vs.ITO 6 9.Intheresult,assessee'sappealisallowedforstatisticalpurposes.” 6.1RespectfullyfollowingtheorderofCo-ordinateBenchas discussedabove,wecondonethedelayandrestorethematter tothefileofld.CIT(A)toallowexemptionu/s11oftheActto theassesseeaspertheprovisionsoflaw.Hence,thegrounds ofappealoftheassesseeareallowedforstatisticalpurposes. 7.Intheresult,theappealoftheassesseeisallowedfor statisticalpurposes. Orderpronouncedintheopencourton29-12-2023 -Sd/- (WASEEMAHMED) ACCOUNTANTMEMBER Ahmedabad:Dated29/12/2023 (TrueCopy)