KANCHENJUNGA DISTILLERIES & LIQUORS,SOUTH SIKKIM V. DCIT, CIRCLE 3(2), , GANGTOK

ITA 930/KOL/2025

AI Insights

The case involves Kanchenjunga Distilleries & Liquors appealing against the order of the CIT (A) which confirmed the disallowance of a deduction of Rs. 2,07,41,111 claimed under section 80 IE of the Income-tax Act, 1961. The disallowance was initially made by the Assessing Officer (AO) due to the belated filing of Form 10CCB, required for claiming deductions under Chapter VIA. The Tribunal examined whether the procedural lapse of late filing of Form 10CCB should disqualify the assessee from the deduction, considering precedents set by the Supreme Court and the Calcutta High Court.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 772446 (ITAT-KOLKATA)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-08-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Assessment Year: 2021-2022
• Other Referred Cases: Commissioner of Income-tax, Maharashtra vs. G. M. Knitting Industries (P.) Ltd. [2015] 376 ITR 456 (SC), Winro Commercial (India) Ltd. vs. Principal Commissioner of Income-tax [2023] 457 ITR 418 (Calcutta)
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SOMNATH DAS BISWAS
• Assessee Lawyers: SIDDHARTH AGARWAL
• Keywords: Set aside; Procedural lapse
• Section: 80IB

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH, KOLKATA BEFORE SHRI RAJESH KUMAR, AM AND SHRIPRADIP KUMAR CHOUBEY, JM ITA No.930/KOL/2025 (Assessment Year:2021-22) Kanchenjunga Distilleries & Liquors C/o Subash Agarwal & Associates, Advocates Siddha Gibson, 1, gibson Lane, Suite 213, 2nd Floor, Kolkata-700069, West Bengal Vs. DCIT, Circle 3(2), Gangtok Sikkim, West Bengal (Appellant) (Respondent) PAN No. AAMFK3402C Assessee by : Shri Siddharth Agarwal, AR Revenue by : Shri Somnath Das Biswas, DR Date of hearing: 08.07.2025 Date of pronouncement: 26.08.2025 O R D E R Per Rajesh Kumar, AM: This is an appeal preferred by the assessee against the order of the CIT (A) Addl/JCIT(A), Delhi(hereinafter referred to as the “Ld. CIT(A)”] dated 12.03.2025 for the AY 2021-22. 02. The issue raised in ground number 1 is against the confirmation of disallowance of Rs. 2,07,41,111/- claimed as deduction under section 80 IE of the Income-tax Act, 1961 (the Act), which was made by the Learned AO on the ground that report in form No. 10CCB was filed belatedly after due date. Printed from counselvise.com Page | 2 ITA No.930/KOL/2025 Kanchenjunga Distilleries & Liquors; A.Y. 2021-22 03. The facts in brief are that the assessee filed the return of income on 22-12-2021 whereas the extended due date was 15-03-2022.The assessee filed the return of income declaring total income at Rs. nil, after claiming deduction under chapter VIA of the Act, to the tune of ₹2,07,41,110/-.The return was processed under section 143(1) by order dated 2-11-2022, assessing the income at Rs. 2,07,41,111/- disallowing the deduction claimed under section chapter VIA of the Act. Though, the assessee filed the return of income within due date however, the form No. 10CCB was filed online on 17-10-2022 which is before the due date of the order under section 143(1) of the Act.Thus, the disallowance of deduction under Section 80 IE of the Act was made by the AO on the ground of non-furnishing of Form 10 CCB within due date. 04. In the appellate proceedings, the appellate authority dismissed the appeal on the ground that the assessee has not filed the Form No. 10 CCB within the due date and therefore, disallowance made by the AO is in accordance with the provision of Section 143(1) of the Act. 05. after hearing the rival contentions and perusing the materials available on record, we find that the return of income was filed within the due date, however the Form 10 CCB was filed after the due date, but before the date of passing the order under Section 143(1) of the Act.The AO CPC disallowed the claim on the ground that since the Form No. 10 CCB was filed after the due date, therefore, assessee was not entitled to deduction under Chapter VIA of the Act, which was confirmed by Learned CIT (A). In our opinion, the act of AO (CPC) is not correct as the filing of Form 10 CCB is a procedural requirement and cannot disentitle the assessee from its claim under Chapter VIA. Nonetheless, the assessee filed the Form 10 CCB online before the Printed from counselvise.com Page | 3 ITA No.930/KOL/2025 Kanchenjunga Distilleries & Liquors; A.Y. 2021-22 date of processing of return of income and passing of order under Section 143(1) of the Act.The case of the assessee finds support from the decision of Hon'ble Apex Court in case of Commissioner of Income-tax, Maharashtra vs. G. M. Knitting Industries (P.) Ltd. [2015] 376 ITR 456 (SC), wherein the Hon. Apex Court has held that Form 10CCB filed during assessment proceedings is m sufficient compliance to deduction under u/s 80IB of the Act. This was held in the context of deduction claimed by the assessee in respect of profit and gains from industrial undertaking under Section 80-IB of the Act and the Form 10 CCB was not filed along with the return of income but was filed before the due date of filing of final assessment order, The Hon'ble Apex Court has concurred with the view of the Hon'ble High Court and held that even if Form 10 CCB was not filed along with the return but the same was filed during the assessment proceeding and before the final assessment order was made, which would amount to sufficient compliance and thus, dismissed the appeal of the revenue.Similarly, in case of the assessee also finds support from the decision of Hon'ble Jurisdictional High Court in case of Winro Commercial (India) Ltd. vs. Principal Commissioner of Income-tax [2023] 457 ITR 418 (Calcutta) dated 22-11-2022, wherein the Hon'ble Kolkata High Court in the context of the claim of the assessee under Section 80 IA of the Act, held that audit report in Form 10 CCB which was not filed within the due date as per the Act would not disentitle the assessee from deduction under Section 80 IA of the Act. The Hon'ble High Court held that the non-filing of the audit report within the due date is a procedural lapse and could be cured in the subsequent stage. The Hon'ble High Court set aside the order passed by the Tribunal as well as the CIT (A) and directed the AO to allow the deduction as claimed under Section 80 IA of the Act.Considering the Printed from counselvise.com Page | 4 ITA No.930/KOL/2025 Kanchenjunga Distilleries & Liquors; A.Y. 2021-22 facts of the assessee’s case in the light of the above decisions, we are inclined to set aside the order of Learned CIT (A) and direct the AO to allow the deduction under Chapter VIA by holding that the late filing of Form 10 CCB is just a procedural defect and it could be cured in the subsequent stage. Needless to state that assessee filed the audit report before the processing of the return which is in sufficiemt compliance. consequently the appeal of the assessee is allowed. 06. In the result, the appeal of the assessee is allowed. Order pronounced in the open court on 26.08.2025. Sd/- Sd/- (PRADIP KUMAR CHOUBEY) (RAJESH KUMAR) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) Kolkata, Dated: 26.08.2025 Sudip Sarkar, Sr.PS Copy of the Order forwarded to: BY ORDER, True Copy// Sr. Private Secretary/ Asst. Registrar Income Tax Appellate Tribunal, Kolkata 1. The Appellant 2. The Respondent 3. CIT 4. DR, ITAT, 5. Guard file. Printed from counselvise.com "