The Kolkata Bench of Income Tax Appellate Tribunal ( ITAT ) ruled that delay in filing Form 10B does not bar exemption under sections 11 and 12 of the Income Tax Act,1961.

Salt Lake Sanskritik Sansad, appellant-assessee, was a charitable society registered under the West Bengal Societies Registration Act, 1961, and section 12A of the Income Tax Act. It was engaged in activities such as relief of the poor, education, yoga, medical relief, and other objects of public utility.

For the assessment year 2023-24, the appellant filed its return of income on 01.09.2023, along with Form 10, declaring accumulation of ₹5,73,129 under section 11(2). It also submitted Form 10BB (audit report) on 31.10.2023, reporting ₹1,32,36,648 as income to be applied in India. A revised return was filed on 14.11.2023 under section 139(4A), declaring ‘NIL’ income.

Form 10A and Form 10BB were filed before 31.03.2024 to avoid denial of exemption. However, the assessment was completed under section 143(1) at an income of ₹25,58,626. Aggrieved, the appellant filed an appeal before the Commissioner of Income Tax (Appeals)[CIT(A)].

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The CIT(A) dismissed the appeal, noting that Form 10BB was filed late and the power to condone the delay rested with the Income Tax Officer under section 119(2) of the Act.

Aggrieved by the decision, the appellant filed an appeal before the ITAT.

A single member bench of Duvvuru RL Reddy ( Vice-President) noted that the assessee was registered under section 12A and had obtained the audit report in Form 10B, though it was not filed one month before the return, as required. However, the report was uploaded along with the return and was available to the Centralized Processing Centre (CPC) at the time of processing.

The assessee relied on rulings from the Gujarat and Calcutta High Courts, which held that delayed filing of Form 10B did not disqualify a trust from claiming exemption under sections 11 and 12.

Since the facts were similar, the appellate tribunal held that the assessee was eligible for exemption and directed the CPC to delete the adjustment made in processing the return. Therefore, the appeal was allowed.

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