| Question And Answer | |
|---|---|
| Subject: | demand u/s 143(1) raised by CPC for a charitable trust for AY 2021-22 |
| Category: | Income-Tax |
| Querist: | seetharaman |
| Answered by: | Advocate Shashi Ashok Bekal |
| Tags: | Audit report, charitable trust |
| Date: | September 11, 2022 |
Respected sir,
A charitable trust regd u/s 12A failed to file audit report in form 10B before the due date for filing tax audit report. However it filed tax audit report before filing return of income and filed return within due date for filing ITR. CPC while processing u/s 143(1) has not allowed the entire expenditure as application of income and treated the gross receipts as taxable income and taxed accordingly. in the intimation no reason given for the disallowance. for filing appeal what grounds can be taken and apart from appeal , any other alternative remedy available . Kindly enlighten.
This is a common issue faced by a lot of assessees. Filing an appeal will not condone the delay in filing Form 10B.
The CBDT had issued a Circular No. 2 of 2020 dated January 3, 2020, wherein it empowered the Ld. CIT(E) to condone a delay in filing of Form 10B up to a period of 356 days for AY 2018-19 & onwards, inter alia.
The Hon’ble Bombay High Court in the case of Little Angels Education Society v. UOI [2021] 434 ITR 423 (Bom)(HC) held that where Form No. 10B was filed by assessee after lapse of more than 365 days of due date of filing of return of income, application for condonation of delay was to be rejected, however, having regard to mandate of section 119(2)(b) of the Act, assessee may approach CBDT, seeking a special order to Commissioner (Exemptions), to condone delay in filing Form No. 10B and thereafter to deal with said claim on merits in accordance with law.
The Assessee may act accordingly