The Delhi bench of the Income Tax Appellate Tribunal (ITAT) allowed Section 80IA deduction as it considered filing the Audit Report in Form 10CCB before filing the Income Tax Return as merely directory and not mandatory for the year under consideration.
The issue to be decided was whether the Form 10CCB is mandatorily to be filed along with the return or the due date specified under Section 139(1) of the Income Tax Act for claiming deduction under Section 80IA of the Income Tax Act, 1961.
The assessee filed return of income on 31.10.2019 declaring income of Rs.13,73,52,170/- after claiming deduction of Rs.51,54,192/- under Section 80IA of the Income Tax Act. The ADIT (CPC) issued letter dated 04.06.2020 proposing various adjustments including disallowance of deduction claimed under Section 80IA of the Income Tax Act on account of failure to file Form 10CCB before the due date specified under Section 139(1) of the Income Tax Act.
Assessee filed revised return on 24.06.2020 to correct various adjustments proposed and along with the revised return the assessee filed Form 10CCB for the deduction claimed under Section 80IA of the Act. The return was processed under Section 143(1) on 26.08.2020 denying the claim for deduction under Section 80IA of the Act. The assessee filed appeal before the CIT (A) and contended that filing of Form 10CCB along with the return of income before the due date for filing return under Section 139(1) is only directory and not mandatory. However, the CIT (A) rejected the claim of the assessee and sustained the disallowance of deduction under Section 80IA of the Income Tax Act.
Mr. Mayank Agarwal representing the assessee placing reliance on various judgments of various High Courts including the jurisdictional High Court in the case of CIT Vs. Contimeters Electricals Pvt. Ltd. submitted that filing of audit report along with the return of income before the due date specified under Section 139(1) is only directory and not mandatory and since the assessee has filed Form 10CCB along with the revised return the claim for deduction under Section 80IA should not have been disallowed
The two member bench of the tribunal comprising G.S.Pannu ( Vice President) and C.N.Prasad ( Judicial member) held that filing of audit report in Form 10CCB before the due date for filing of return of income under Section 139(1) is only directory and not mandatory for the year under consideration. Thus, ITAT directed the AO to allow deduction claimed under Section 80IA of the Income Tax Act. Accordingly, the appeal of the assessee was allowed.
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
