Once Income Tax Form 10EE Furnished, it applies Automatically to Subsequent Years: ITAT allows Section 89A Benefit [Read Order]
Form 10EE is only a procedural requirement, and once exercised, the option continues for subsequent years unless the assessee becomes a non-resident, in which case special rules apply
Once Income Tax Form 10EE Furnished - applies Automatically - Subsequent Years - ITAT - Section 89A Benefit - taxscan
Once Income Tax Form 10EE Furnished - applies Automatically - Subsequent Years - ITAT - Section 89A Benefit - taxscan
The Income Tax Appellate Tribunal ( ITAT ), Mumbai Bench, has held that once a taxpayer exercises the option under Section 89A of the Income Tax Act, 1961 by furnishing Form 10EE, there is no requirement to furnish the form afresh in subsequent years.
An appeal was filed by the assessee, Jignesh Naresh Jariwala, where the Tribunal allowed the assessee’s claim for relief under Section 89A of the Income Tax Act.
The assessee, an employee of LTIMindtree, maintained retirement benefit accounts in the USA, a notified country. He had duly exercised the option under Section 89A by filing Form 10EE on 29.06.2022 for AY 2022-23, choosing to defer taxation of income accrued in such retirement accounts until the year of withdrawal or redemption in the foreign jurisdiction.
In AY 2023-24, he reported income of ₹4,34,659 from these accounts and claimed relief under Section 89A. However, the Centralised Processing Centre (CPC) at Bengaluru disallowed the relief during intimation under Section 143(1) on the ground that Form 10EE was not filed for the year, and the CIT(A) subsequently upheld this denial.
Before the Tribunal, the assessee argued that Rule 21AAA(6) of the Income Tax Rules, 1962 makes it explicit that once the option is exercised in Form 10EE for any previous year, it automatically applies to all subsequent years and cannot be withdrawn. Therefore, there was no legal requirement to file the form afresh every assessment year.
The bench of Narendra Kumar Billaiya and Anikesh Banerjee, after examining the rules, agreed with the assessee. It observed that Form 10EE is only a procedural requirement, and once exercised, the option continues for subsequent years unless the assessee becomes a non-resident, in which case special rules apply.
Hence, denial of Income Tax Section 89A relief merely because the form was not filed again in AY 2023-24 was unsustainable. The ITAT set aside the order of the CIT(A) and directed that the relief under Section 89A amounting to ₹4,34,661 be allowed.
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