The Income Tax Appellate Tribunal (ITAT), New Delhi Bench, has recently, in an appeal filed before it, held that deduction u/s 80(1C) is allowable,if form 10CB is filed before final assessment order.
The aforesaid observation was made by the Delhi ITAT, when an appeal was filed before it by the Revenue,as directed against the order dated 16.08.2019 of the Commissioner of Income Tax (Appeals), New Delhi, relating to Assessment Year 2017-18.
The sole issue raised in the instant appeal being as to whether, the CIT(A) has erred on facts and in the circumstances of the case, in deleting the disallowance of 80IC, ignoring the facts that the audited report in Form 10CCB is mandatory to be filed along with return of income as per the provision of section 80IA(7) which is pre-condition of claiming the deduction, the brief facts of the case pertaining to the issue were that the assesseewas a company who filed its return of income for A.Y. 2017-18 on 24.10.2017, declaring the total income at Rs.6,24,70,710/-. CPC vide intimation u/s 143(1) of the Income Tax Act.
Aggrieved by the order of AO, the assessee carried the matter before CIT(A), who vide the order dated 16.08.2019 in Appeal No.110/18-19/CIT(A)-4, allowed the appeal of the assessee. And it is being agitated by the order of CIT(A), that Revenue has preferred the instant appeal before the Delhi ITAT.
With Shri Rajendra Jha, Sr. D.R.submitting that assessee had filed the return of income declaring taxable income at Rs. 6,24,70,710/- inter alia by claiming deduction of Rs. 2,31,17,115/- u/s 80IC of the Act, he added that for claiming deduction u/s 80IC of the Income Tax Act, the assessee is required to furnish report in Form-10CCB which the assessee had uploaded on the website of the Income-tax Department on 10.11.2017 i.e., subsequent to the filing of return of income.
The DR further having submitted that since the assessee had not filed Form 10CCB along with return of income, the AO was fully justified in denying the claim of deduction u/s 80IC of the Act and that the CIT(A) should have upheld the order of AO, Shri Vijay Singla, C.A, the AR of the assessee, on the other hand supported the order of CIT(A) by pointing to the findings of CIT(A), thereby placing reliance on the decision of Apex Court in the case of CIT vs. G. M. Knitting Industries (P.) Ltd. ,wherein it has been held that when Form 10CCB is not filed with the return of income but is filed before the passing of the assessment order, then in that case the claim of deduction cannot be denied.
Hearing the opposing contentions of either sides and perusing the materials available on record, the Delhi ITAT observed:
“We have heard the rival submissions and perused the material available on record. The issue in the present ground is about the denial of claim of deduction u/s 80IC of the Act by AO but allowing the claim of the assessee by CIT(A). The only reason for denying the claim of deduction u/s 80IC of the Act by AO was that the Form 10CCB was uploaded by the assessee on the website of the Income-tax Department on 10.11.2017 whereas the return of income was filed on 24.10.2017 and the return of income was processed u/s 143(1) of the Act on 30.10.2018.”
“We find that the CIT(A) while deciding the issue in favor of the assessee, has given the finding that though there was delay in upholding Form 10CCB but the same was uploaded before the return of income was processed u/s 143(1) of the Act. For allowing the ground of assessee, CIT(A) had relied on the decision of Hon’ble Delhi High Court in the case of CIT vs. Contimeters Electricals (P.) Ltd. [2009] 178 Taxman 422 (Delhi) and other decisions. We find that Hon’ble Apex Court in the case of CIT vs. G. M. Knitting Industries (P.) Ltd. (2017) 71 taxmann.com 35 (SC) hasheld even though Form 10CCB was not filed along with the return of income but when the same was filed before the final order of assessment was made, assessee was entitled to claim deduction.”, the ITAT Panel comprising of Yogesh Kumar US, the Judicial Member, along with Anil Chaturvedi, the Accountant Member noted.
Thus, dismissing the Revenue’s appeal, the Delhi ITAT held:
“Before us, the Revenue has not pointed to any contrary binding decision in its support nor has pointed to any fallacy in the findings of CIT(A). We, therefore, find no reason to interfere with the order of CIT(A) and thus the ground of Revenue is dismissed.”
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