The Delhi bench of the Income Tax Appellate Tribunal ( ITAT ) recently ruled on a case where deduction claims under Section 80IC of the Income Tax Act, 1961 were disallowed due to the failure to submit the audit report in Form 10CCB before Income Tax Return ( ITR ) filing.
The assessee, engaged in the manufacturing of Security Systems, filed its Income Tax Return on 22/10/2018, declaring a total income of Rs. 41,50,850/- after claiming deductions under Chapter VIA amounting to Rs. 34,47,498/-. However, Form 10CCB was filed on 03/04/2019, post the due date for ITR filing.
Subsequently, an intimation under Section 143(1) of the Income Tax Act, 1961 was issued by the ADIT, CPC, Bangalore on 12/01/2020, determining the total income at Rs. 90,54,230/-. This intimation included an addition to the business income of Rs. 15,05,381/- and denied the deduction under Section 80IC amounting to Rs. 33,97,998/- due to the non-filing of Form No.10CCB within the due date.
During the proceedings, the counsel for the assessee argued that the deduction claim under Section 80IC should not have been denied as the return of income was filed on time, and Form 10CCB was filed subsequently. However, the respondent contended that the failure to file the Audit Report on time as required by law justified the orders passed by the lower authorities.
After examining the submissions and the facts of the case, the bench, consisting of Narendra Kumar Billaya (Accountant member) and Yogesh Kumar U.S (Judicial member), noted that the audit report in Form No. 10CCB was filed after the due date for ITR filing. The tribunal emphasized that compliance with the provisions of filing the Audit Report under Section 80IC within the stipulated time was crucial for claiming the deduction under this section.
Additionally, the tribunal found no merit in the argument that the assessee had been claiming deductions under Section 80IC since the previous assessment year. Therefore, the ITAT concluded that the appeal filed by the assessee lacked merit and subsequently dismissed it.
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