The Mumbai bench of the Income Tax Appellate Tribunal ( ITAT ) allowed a tax exemption of Rs. 4.07 crore to a public charitable trust, despite a procedural delay in the validation of Form 10BB.
The assessee had filed its income tax returns, claiming an exemption of Rs. 4.07 crore. The trust had obtained Form 10BB on 29-09-2022 and filed its return of income on 30-09-2022, mentioning the details of the Form 10BB report. However, the form was validated only on December 5, 2022. The Central Processing Centre (CPC) disallowed the exemption claim, assuming that Form 10BB had not been filed.
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The assessee contended that the delay in validation was merely procedural and that the form had been obtained before the return was filed. They also contended that the Commissioner of Income Tax (Appeals) had the power to condone the delay and that the CBDT Circular was not binding on the appellate authority. The trust also claimed that expenses of Rs. 4,06,07,733 should be allowed against the receipts if the exemption was not granted.
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The ITAT noted that the due date for filing Form 10BB was 7-10-2022, and the trust had obtained and uploaded the form on September 29 and 30, 2022, respectively. The form was digitally signed on 30-09-2022 and verified on 5-12-2022.
The bench found no reason to deny the exemption claimed by the trust, as the form had been uploaded along with the return of income and was duly verified.
The ITAT directed the assessing officer to allow the exemption.
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ITAT further noted that “it can be seen from the above that Form 10BB was uploaded along with the return of income and was duly verified, therefore, we do not find any reason to deny the exemption claimed by the assessee. The AO is directed to allow the same.”
The ITAT, comprising Anikesh Banerjee ( Judicial Member ) and Narendra Kumar Billaiya (accountant member), allowed the assessee’s appeal.
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