Jodhpur ITAT: No Additional Liability for Delayed Form 10 Filing When Favoured by CIT(E) for ITR U/S 139

No addition can be made for the delay in filing Form No. 10 within the due date of the Income Tax Return under Section 139 of the Income Tax Act, 1961 since the same is been condoned by the commissioner of the income tax (exemption), Income Tax Appellate Tribunal (ITAT) in Jodhpur ruled.

The taxpayer, Sarla Singhvi Charitable, is a trust registered under Section 12AA and 80G of the Income Tax Act, 1961. The taxpayer in that year, declared total income as Rs. NIL on the date 12/09/2019, as per the provisions of Sections 11 and 12 of the Income Tax Act.

Rs. 77,89,989/- has been applied for charitable purposes out of aggregate receipts of Rs. 1,22,51,272/-, during the year, and Rs. 26,23,593/- have been set apart for the defined objective.

In filing Form No. 10 there has been a delay since the form was directed to be filed before the last date of ITR filing under Section 139(1), and as a result, CPC has made an addition of Rs. 26,23,593/- at the time of ITR processing.

As a result, a request for the condonation of the delay in submitting Form 10 was filed with the respected Commissioner of Income Tax (Exemption), after a thorough examination of the detailed records of investments made in accordance with Section 11(5), the Commissioner of Income Tax (Exemption) granted approval for the delayed filing of Form 10. However, despite this condonation, the appeal of the taxpayer was rejected by the Commissioner of Income Tax (Appeals).

Dissatisfied with this decision, the taxpayer filed an appeal with the tribunal. Shyam S. Singhvi, who represented the taxpayer, argued that the Commissioner of Income Tax (Exemption) had already condoned the delay in filing Form No. 10, which occurred after the due date for the Income Tax Return under Section 139 of the Income Tax Act, 1961. Therefore, the decision made by the Commissioner of Income Tax (Appeals) to reject the appeal was not justified.

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S.M. Joshi, the representative for the Revenue, supported the position taken by the lower authorities.

The tribunal noted that there was indeed a delay in submitting Form No. 10. However, the delay had been officially condoned by the Commissioner of Income Tax (Exemption). During the process of condonation, the Commissioner of Income Tax (Exemption) thoroughly examined the evidence and also requested detailed information regarding the investments. Subsequently, a comprehensive order was issued on May 29, 2020, in accordance with Section 119(2)(b) of the Income Tax Act.

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After a careful review of the facts and circumstances, the two-member tribunal, comprising Dr S. Seethalakshmi (Judicial Member) and Rathod Kamlesh Jayantbhai (Accountant Member), determined that no additional penalties or charges could be imposed for the delay in filing Form No. 10 beyond the due date for the Income Tax Return under Section 139 of the Income Tax Act, as it had already been condoned by the Commissioner of Income Tax (Exemption).