Form 10 ID must be Filed within Due Date Specified u/s 139(1) for availing Concessional Rate u/s 115BAB : ITAT [Read Order]

The Raipur Bench of the Income Tax Appellate Tribunal (ITAT) held that Form 10ID must be filed within the due date specified under Section 139(1) for availing for the concessional tax rate under Section 115BAB of the Income TaxAct.

Vivrn Foods Private Limited (assessee), a company engaged in manufacturing of food and other products, filed income tax return for the assessment year 2024-25 on 12.11.2024, declaring a total income of Rs. 1,98,50,380 and opting for the concessional tax rate under Section 115BAB of the Income Tax Act.

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The due date for filing the return was 31.10.2024, extended to 15.11.2024. The return was processed under Section 143(1) by the Central Processing Centre (CPC), Bangalore. The assessee filed Form 10ID after the due date of the first return filed for the assessment year 2022-23.

The Assessing Officer (AO) disallowed the claim for the concessional tax rate under Section 115BAB, citing the late filing of Form 10ID. Aggrieved by the AO’s order, the assessee appealed to the Commissioner of Income Tax (Appeals) [CIT(A)]. The CIT(A) upheld the AO’s decision.

Aggrieved by the CIT(A)’s order, the assessee appealed to the ITAT. The counsel for the assessee contended that the assessee had complied with the conditions of Section 115BAB, including commencing manufacturing activities and exercising the option in the year of commencement, as per subsections (2) and (7) of the section.

The Counsel for the Revenue argued that the mandate of Section 115BAB(7) clearly requires Form 10ID to be filed on or before the due date specified under Section 139(1) for the first return of income for any assessment year commencing on or after 1st April 2020. The counsel submitted that since the assessee filed Form 10ID after this due date, the claim was rightly disallowed.

The two-member bench comprising Partha Sarathi Chaudhury (Judicial Member) and Arun Khodpia (Accountant Member), observed that the assessee filed Form 10ID on 21.09.2024 was after the due date of the first return filed on 24.02.2022 for the assessment year 2022-23.

The Tribunal observed that Section 115BAB(7) explicitly mandates timely filing of Form 10ID to avail the concessional tax rate. It further noted that the assessee failed to demonstrate any exceptional circumstances justifying the delay in filing Form 10ID.

The bench rejected the assessee’s claim of non-compliance with natural justice, stating that the CIT(A) had acted within the legal framework. It upheld the CIT(A)’s order, confirming the disallowance of the lower tax rate under Section 115BAB due to the late filing of Form 10ID. The appeal of the assessee was dismissed.

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