THE QUAIDE MILLETH EDUCATIONAL AND SOCIAL TRUST,CEHNNAI V. ITO, EXEMPTIONS WARD 1, CHENNAI, CHENNAI

ITA 2814/CHNY/2024

AI Insights

The case involves The Quaide Milleth Educational and Social Trust, which appealed against the order of the CIT(A) denying accumulation under section 11(2) of the Income Tax Act due to the belated filing of Form No.10. The Tribunal noted a delay of 158 days in the appeal and condoned it, proceeding to decide on merits. The primary legal issue was the mandatory requirement to file Form No.10 within the due date as specified under section 139(1), following the amendment to section 13(9) effective from 01-04-2016. The Tribunal emphasized that the form's timely submission is not merely a directory but a mandatory statutory requirement, and the appropriate remedy for any delay is to seek condonation under section 119(2)(b) as per CBDT Circular No.03/2020.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 472385 (ITAT-CHENNAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-02-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2016-2017
• Laws Referred To: Income Tax Act
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: ASHWIN D. GOWDA LD.
• Assessee Lawyers: N. ARJUN RAJ LD
• Keywords: Condonation of delay
• Section: 119; 119(2)(b)

Judgement Text

" आयकर अपीलीय अिधकरण “ए” \rा यपीठ चे\u0012ई म\u0015। IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, CHENNAI मा ननीय \u0018ी एबी टी. वक\u001c, \rा ियक सद\u001f एवं मा ननीय \u0018ी मनोज क ुमा र अ$वा ल ,लेखा सद\u001f क े सम&। BEFORE HON’BLE SHRI ABY T. VARKEY, JM AND HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM आयकरअपील सं ./ ITA No.2814/Chny/2024 (िनधा 'रणवष' / Assessment Year: 2016-17) The Quaide Milleth Educational and Social Trust #82, Sterling Road, Nungambakkam, Chennai-600 034. बनाम/ Vs. ITO Exemptions Ward-1 Chennai. \u0002थायीलेखासं./जीआइआरसं./PAN/GIR No. AABTT-3583-E (अपीलाथ\u001c/Appellant) : (\u001f थ\u001c / Respondent) अपीलाथ\u001cकीओरसे/ Appellant by : Shri N. Arjun Raj (Advocate) - Ld.AR \u001f थ\u001cकीओरसे/Respondent by : Shri Ashwin D. Gowda (Addl.CIT) - Ld. Sr. DR सुनवाईकीतारीख/Date of Hearing : 28-01-2025 घोषणाकीतारीख /Date of Pronouncement : 03-02-2025 आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member) 1. Aforesaid appeal by assessee for Assessment Year (AY) 2016-17 arises out of the order of learned Addl. / Joint Commissioner of Income Tax (Appeals)-4, Bengaluru [CIT(A)] dated 15-03-2024 in the matter of an assessment framed by the Ld. AO u/s.143(3) of the Act on 26-12- 2018. The registry has noted delay of 158 days in the appeal, the condonation of which has been sought by the Ld. AR. Considering the period of delay and the status of the assessee, the delay is condoned and we proceed with disposal of the appeal on merits. 2 2. Upon perusal of assessment order, it could be seen that the assessee filed its return of income on 22-11-2016 claiming exemption u/s 11 of the Act. During scrutiny proceedings, it was noted that there was shortfall in application of income and the assessee had filed Form No.10 seeking accumulation of amount of Rs.20.35 Lacs u/s 11(2) of the act. However, this form was filed belatedly on 24-04-2017 though the same was required to be filed on or before due date as specified u/s 139(1). Accordingly, Ld. AO denied accumulation u/s 11(2) and framed the assessment. 3. The Ld. CIT(A) held that in terms of amendment to Sec.13(9) w.e.f. 01-04-2016, the assessee is mandatorily required to file this form within due date u/s 139(1). Further, the remedy available to the assessee would be to file petition for condonation of delay u/s 119(2)(b) of the Act before appropriate authority as per Circular No.03/2020 dated 03-01-2020. This circular authorizes the Commissioner of Income Tax to admit the applications filed for belated filing of Form No.9A / 10 and condone the delay. Accordingly, the action of Ld. AO was confirmed against which the assessee is in further appeal before us. 4. It is quite discernible that the new amendment as applicable w.e.f. 01-04-2016 put an obligation on the assessee to file this form before due date u/s 139(1). The same is not merely an empty formality but mandated by the statute. Having not done so, the appropriate remedy that would be available to the assessee is to seek remedy before appropriate authority as per Circular No.03/2020. Thus, a remedial mechanism has already been provided to the assessee under law and the proper recourse for the assessee would be to seek condonation before appropriate authority. 3 5. The Ld. AR has urged that filing of the form is directory in nature and the same was made available before culmination of assessment proceedings. Reliance has been placed on various case laws in this regard. However, after the specific amendment of Sec. 13(9), this plea could not be accepted. The remedial mechanism has already been provided to the assessee vide CBDT Circular No.03/2020. If the form is held to be directory in nature, the amendment as well as aforesaid CBDT Circular would have no meaning and the same would be rendered otiose. Therefore, this plea of Ld. AR cannot be accepted and the case laws as cited by Ld. AR would not render any assistance to assessee after the relevant amendment w.e.f. 01-04-2016. 6. Having said so, we find that appropriate remedial mechanism has already been provided to the assessee to seek condonation of delay before appropriate authority u/s 119 of the Act. To enable the assessee to avail the same, for the said limited purpose, we restore the appeal back to the file of Ld. CIT(A) who shall consider the claim of the assessee in the light of condonation application, if any, as filed by the assessee which shall be done within a time of three months. If the assessee fails to prefer the same, the action of Ld. AO shall stand confirmed. 7. The appeal stand partly allowed for statistical purposes. Order pronounced on 3rd February, 2025 Sd/- Sd/- (ABY T. VARKEY) (MANOJ KUMAR AGGARWAL) \rा ियक सद\u001f /JUDICIAL MEMBER लेखा सद\u001f / ACCOUNTANT MEMBER चे4ई Chennai; िदनांक Dated : 03-02-2025 DS 4 आदेश की Fितिलिप अ$ेिषत / Copy of the Order forwarded to : 1. अपीलाथ\u001c/Appellant 2. \u001f थ\u001c/Respondent 3. आयकरआयु=/CIT Coimbatore/Madurai/Chennai. 4. िवभागीय\u001fितिनिध/DR 5. गाडBफाईल/GF "