The Chennai Bench of Income Tax Appellate Tribunal ITAT) granted relief to ASAN Memorial Association, allowing its statutory deduction claim under Section 11(1)(a) of Income Tax Act,1961 despite a filing error in the income tax return.
ASAN Memorial Association,the appellant-assessee,filed its return of income on September 1, 2016, declaring a total income of nil. In Part B-TI, clause 9(v), the association reported an amount of zero for the accumulation set apart for charitable purposes, which should have reflected Rs. 5,30,42,826, representing 15% of the income derived from property held in trust, as permitted under Section 11(1)(a).
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The Centralized Processing Centre (CPC) denied this statutory deduction, citing the incorrect entry in column 9(iv) instead of 9(v) and noted the failure to submit Form 9A, which is required for claiming such deductions.
The Commissioner of Income Tax (Appeals) [CIT(A)] confirmed the CPC’s adjustment, asserting that the lack of Form 9A justified the disallowance, leading to the dismissal of the appeal.
The Authorized Representative (AR) for the assessee argued that the association was indeed entitled to the 15% deduction under Section 11(1) but had mistakenly filled the figure in column 9(iv). The AR maintained that the requirement for Form 9A was unnecessary for claiming this statutory deduction, pointing out that the CPC’s disallowance resulted from the clerical error in the return.
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The Departmental Representative(DR) supported the decisions made by the CPC and CIT(A).
After reviewing the submissions and relevant materials, the tribunal agreed with the AR’s argument that the claim should not be disallowed due to the clerical error. It noted that the pertinent information was evident in the audit report accompanying the return.
The two member bench comprising Mahavir Singh(Vice President) and Jagadish(Accountant Member) set aside the orders of the CIT(A) and CPC, instructing the Assessing Officer (AO) to allow the deduction under Section 11(1)(a).
In conclusion,the appeal was subsequently allowed for statistical purposes.
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