M/s Raj Laxmi Charitable Trust, Meerut V. Commissioner of Income Tax (Exemption), Lucknow

ITA 183/LKW/2020

AI Insights

The case involves M/s Raj Laxmi Charitable Trust appealing against the decision of the CIT (Exemptions) Lucknow, which refused to condone the delay in filing Form-10 electronically as required under the amended Income Tax Rules. The trust argued that the delay was due to a reasonable cause, as they were unaware of the amendment requiring electronic filing under digital signature, and the form was eventually filed electronically during the assessment proceedings. The Tribunal found merit in the trust's arguments and directed the CIT (Exemptions) to reconsider the matter after condoning the delay.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 113240 (ITAT-LUCKNOW)
• Duration Of Justice: 3 year(s) 1 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-05-2023
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: B
• Next Hearing Date: 30-04-2023
• Assessment Year: 2016-2017
• Appeal Filed On: 16-03-2020
• Laws Referred To: Income Tax Act 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHEELA CHOPRA
• Keywords: Charitable institution; Reasonable cause; Condonation of delay
• Section: 11; 119(2)(b); 20

Judgement Text

I.T.A. No.183/Lkw/2020 Assessment year:2016-17 1 IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH ‘B’, LUCKNOW BEFORE SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER AND SHRI ANADEE NATH MISSHRA, ACCOUNTANT MEMBER I.T.A. No.183/Lkw/2020 Assessment Year: 2016-17 M/s Raj Laxmi Charitable Trust, A-64, Saket, Meerut. PAN:AAATR4883Q Vs. CIT (Exemptions) Lucknow. (Appellant) (Respondent) O R D E R PER ANADEE NATH MISSHRA, A.M. (A) In this case, appeal in Form-36, filed by the assessee, was dispatched vide registered post by the appellant assessee on 14/03/2020 and was received by registry of this Tribunal on 17/03/2020. Vide letters dated 14/03/2020, 23/06/2022 and 31/05/2022 filed along with this appeal in Form-36 and supported by affidavit dated 21/06/2022, request has been made by the assessee for condonation of delay in filing of this appeal. The relevant portion of aforesaid affidavit dated 21/06/2022, deposed by Shri Alok Rastogi, Secretary of the assessee trust, the following facts have been stated in support of the assessee’s request for condonation of delay in filing of this appeal: Appellant by Shri Rishi Sharma, Accountant of the assessee Respondent by Smt. Sheela Chopra, CIT (D.R.) Date of hearing 01/05/2023 Date of pronouncement 08/05/2023 I.T.A. No.183/Lkw/2020 Assessment year:2016-17 2 1. That I being the Secretary of Rajlaxmi Charitable Trust, is fully acquinted with the facts and figures of the above mentioned Trust. 2. That I confirm that the order u/s 119(2)(b) of the Income Tax Act 1961 dated 14.5.2019 of the Learned CIT(Exemption) Lucknow , has not been served on me. It is supposed to have served on our Employee on 28.05.2019 who left the Job with us in June, 2019 and has not handover the above mentioned order to me. 3. That I only came to know about this order when the Learned Assessing officer ITO(Exemption) Ghaziabad has sent us a letter dated 12.3.2020 (DIN & Letter No. ITBA/Com/F/17/2019- 2020/10264761401(l) in regard to the scheme of Vivad se Vishwas 2020 as settlement of disputes in this case. 4. That after receiving the above mentioned letter dated 12.3.2020 of ITO (Exemption) Ghaziabad, I have filed an appeal before the ITAT, Lucknow Benches, Lucknow on 14.3.2020. 5. That this appeal is filed late by 234 days and from the facts as stated above it is clear that there is a reasonable cause in not filing this appeal within the time allowed to file this appeal. 6. That an application for condonation of delay in filing this appeal, is filed alongwith Appeal Papers filed on F.No. 36 sent on 14.3.2020. (B). At the time of hearing before us, the assessee was represented by Shri Rishi Sharma, Accountant of the assessee and Revenue was represented by Smt. Sheela Chopra CIT (D.R.). We took notice of the grounds on which condonation of delay in filing of this appeal has been requested by the appellant assessee. We also heard the representatives of both the sides on this issue. After hearing both the sides and after giving due consideration to the reasons stated for seeking the condonation of delay, representatives of both the sides were in agreement that the delay in filing of this appeal by the appellant trust should be condoned. In view of I.T.A. No.183/Lkw/2020 Assessment year:2016-17 3 the foregoing, and as representatives of both sides are in agreement with this, we condone the delay in filing of this appeal in the Tribunal. (C) The grounds of appeal in the present appeal, filed by the assessee, are as under: “1. That the learned CIT(EXEMPTION) Lucknow erred in refusing to condone the delay in filing F.NO.10 electronically in the time allowed by the Act. The facts mentioned in the order are not correct. 2. That in this case the form No. 10 is filed on 26/07/2016 vide speed post receipt NO.EU592974945 IN. As per the amendment w.e.f.1.4.2016 the form No.10 is to be filed electronically under the digital signature of the Secretary of the Trust. Assessee filed F.No.10 electronically on 18.12.2018 during the assessment proceedings. The Assessee being unaware the changes in the Act, is prevented by reasonable cause in not filing the F.No.10 electronically in time allowed by the Act. 3. That as per circular No.7/2018 dated 20.12.2018 of the CBDT, the Assessee is entitled to get the condonation of delay in filing F.No.10 electronically, if it qualifies the conditions laid down in the circular. The assessee has fulfilled both the conditions laid down in the circular No.7/2018. 4. That it is prayed that the Learned C.I.T. kindly be directed to condone the delay in filing of F.No.10 electronically in this case. That there is delay in filing this appeal before your honour which is due to the reasonable cause, may kindly be condoned.” (C.1). The perusal of the aforesaid grounds of appeal shows that the assessee is aggrieved by refusal of the CIT (Exemptions) to condone the delay in filing of Form-10. I.T.A. No.183/Lkw/2020 Assessment year:2016-17 4 (C.2) The perusal of records shows that the assessee has filed written submissions dated 28/03/2022 in Tribunal, the relevant portion of which is reproduced as under: “1. That the Appellant is Registered Charitable Trust. 2. That the Appellant Trust has filed F.No. 10 before the I.T.O. Ward (Exemption) Ghaziabad on dated 26-07-2016 through the Speed Post vide Receipt No. EU592974945IN . Copy of F.No.10 filed are enclosed (Page No.5 & 6) of the Paper book filed. A sum of Rs.1687092/- has been accumulated or set apart for specified purpose u/s 11(2) of the Income Tax Act 1961. The Accumulate Income has been invested in FDR's and Bank Account with Kotak Mahindra Bank standing at Rs.2,23,08,794/- & Rs.2,37,63,488/- respectively as reflected in the Balance sheet of Trust as on 31-03-2016. Copy of Balance sheet of Trust as on 31-03-2016 is enclosed. (Page No.7 to 18 of the Paper Book). 3. That as per the amendment made effective w.e.f. 01-04-2016 in the Income Tax Rules No. 17, the F.No.10 is to be filed electronically under Digital signatures. The Appellant is not aware of this amendment which is purely a technical provision. Hence, the assessee is prevented by reasonable cause in not filing F.No. 10 electronically , when this mistake came into the knowledge of the appellant, the appellant has filed F.No.10 electronically on 18-12-2018 during the assessment proceedings. Photocopies of F.No.10 filed electronically is enclosed (Page No.19 to 20 of the Paper Book). 4. That the Appellant Trust has filed an application requesting for the condonation of delay in filing the F.No.10 electronically before the C.I.T.(exemption) Lucknow on dated 19-12-2018 Page No.21 (u/s 11(2) read with Rule 17 u/s 119(2)(b)). Appellant's Application dated 19-12-2018 has been rejected by the Learned C.I.T.(Exemption) Lucknow on 14-05-2019 (Page No.36 & 37 )against which this Appeal has been filed by the Appellant before your honour. 5. That as per the CBDT circular No.7/2018 dated 20-12-2018 the assessee is entitled to get condonation of delay in filing F.No.10 electronically if it qualifies the two conditions laid down in the I.T.A. No.183/Lkw/2020 Assessment year:2016-17 5 circular mentioned in Para No. 6 of circular. We may point out here that the Trust has fulfilled both the conditions laid down in the CBDT CIRCULAR No.7/2018 dated 20-12-2018. Appellant has been prevented by reasonable cause in not filing F.No.10 with in time and further the appellant has set apart the amount accumulated which has been invested in deposited in the term mentioned in sub section (5) of section 11 of the Act. Copy of the CBDTcircu.lar No.7/2018 dated 20-12-2018 is enclosed (Page No.22 to 23 of the Paper Book). 6. That the accumulated amount of Rs. 16,87,093/- as on 31/03/2016 has been invested for the specified purpose u/s 11(2) in A.Y.2018-19 and A.Y. 2019-20. 7. That details of all the accumulation made in all the years along with the details of the investment made in A.Y.2018-19 onwards were filed alongwith the letter dated 09.04.2019 & 06- 05-2019 (Page No.24 to 35 of the Paper Book) filed before the C.I.T.(Exemption) Lucknow along with the Photocopies of all the purchase deeds of the land and Copies of land account for all the years in proof of the Investment of accumulation made in all these years. The Learned CIT(Exemption) has not condoned the delay in filing the F.No.10 Electronically vide order dated 14.05.2019 ( Page No.36 & 37). 8. That the Learned Assessing Officer ITO(Exemption), Ghaziabad is wrong in mentioning in the assessment order dated 19-12- 2018 for the A.Y.2016-17 that the assessee has not carry forwarded the amount accumulated in AY : 2016-17 to AY ; 2017-18 (Page No.38 to 41), As the accumulated amount has not been spent or set apart in AY : 2017-18, the same has not been shown in F.No. 10 filed for AY : 2017-18. The accumulated amount has actually spent in AY : 2018-19 & AY : 2019-20 which is proved from the details which were filed along with the Letter dated 06-05-2019 filed before the C.I.T.(Exemption )Lucknow. These details are already in the records in the Income Tax Return & Balance sheet filed for AY : 2018-2019 & AY : 2019-20. The Appellant Trust has filed an appeal against the assessment order for the A.Y.2016-2017 on 28-12-2018 (Page No.42 to 45). 9. That the order dated 14.05.2019 has been passed by CIT(Exemption) Lucknow. This order is said to be have I.T.A. No.183/Lkw/2020 Assessment year:2016-17 6 delivered in appellants office on 28.05.2019. This information could not reach the Secretary of Trust as the old accountant of the Trust has left the job with Trust in June 2019. From the ITO(Exemption) Ghaziabad letter dated 12.03.2020 (DIN & letter No.ITBA/Com/F/17/2019-20/10264.76140(l) regarding the scheme of Vivad se Vishwas 2020 for settlement of direct tax disputes regarding /2381, the appellant came to know about the CIT(Exemption) Lucknow order u/s 119(2)(b) of the Income Tax Act 1961 dated 14.05.2019 for condonation of delay in filing F.No.10. Hence immediately on 14.03.2020 appellant Trust has filed an appeal on Form No.36 before the Hon'ble ITAT Lucknow Bench. Hence , the Appellant is prevented by the reasonable cause in not filing the appeal on Form No.36 before your honour with in 60 days of the order. It is therefore prayed that the delay in filing this appeal before your honour may kindly be condoned. Legal Side of this Appeal: That as per the CBDT circular No.7/2018 dated 20-12-2018, the assessee is entitled to get the condonation of delay in filing F.No. 10 electronically . In this case the F.No. 10 has been filed on 26-07-2016 with the ITO (Exemption) Ghaziabad vide speed post Receipt No. EU592974945IN which is well with in the time allowed by the Act. As per the amendment made w.e.f. 01-04-2016 the assessee is to file F.No.10 electronically . This is the first year of Amendment . In this case F.No.10 is electronically filed on 18-12-2018 during the Assessment proceedings. Hence, it is a clear case of reasonable cause of delay in filing of F.No.10 electronically with in the time allowed by Act. It is therefore prayed that the appellant's appeal kindly be allowed and the Learned C.I.T.(Exemption) Lucknow kindly be directed to accept and condone the delay in filing the F.No.10 electronically as the Learned CBDT vide circular No. 7/2018 dated 20- 12-2018 has authorised the Learned CIT(Exemption) to condone the delay in filing the F.No. 10 electronically.” (C.2.1). At the time of hearing before us on 01/05/2023, we took notice of the aforesaid written submissions. At the time of hearing before us, I.T.A. No.183/Lkw/2020 Assessment year:2016-17 7 Revenue was represented by Smt. Sheela Chopra, CIT (D.R.) while the assessee was represented by Shri Rishi Sharma, Accountant of the assessee trust. We heard the representatives of both the sides. Representatives of both the sides were in agreement, after giving due consideration to aforesaid written submissions of the appellant assessee, that the learned CIT (Exemptions) be directed to condone the delay in filing of Form-10 and that the learned CIT (Exemptions) be directed further to pass fresh order in accordance with law on merits, after condoning the delay in filing of Form- 10 and after providing reasonable opportunity to the assessee. In view of the foregoing and as representatives of both sides are in agreement with this, we direct the learned CIT (Exemptions) to condone the delay in filing of Form-10 and we further direct the learned CIT (Exemptions) to pass fresh order in accordance with law after condoning the delay in filing of Form-10 and after providing reasonable opportunity to the assessee. We order accordingly. 5. In the result, the appeal of the assessee stands partly allowed for statistical purposes. (Order pronounced in the open court on 08/05/2023) Sd/. Sd/. (SUDHANSHU SRIVASTAVA) (ANADEE NATH MISSHRA) Judicial Member Accountant Member Dated:08/05/2023 *Singh Copy of the order forwarded to : 1. The Appellant 2. The Respondent. 3. Concerned CIT 4. The CIT(A) 5. D.R., I.T.A.T., Assistant Registrar