Thursday, 19 August 2021

A Missed compliance- Can cost Crores

 



Making non-compliance an even costlier affair, Bangalore ITAT recently dismissed an assessee’s appeal seeking the rectification of disallowance by the CIT on grounds of non-furnishing of Form 10, of an amount set apart by the assessee. 
As a brief background, Navodaya Education Trust (assessee), registered under u/s 12A, had declared nil income for AY 2015-16 after setting apart INR 6.99 cr. for the purposes specified in Section 11. The assessee, however, failed to submit Form 10 within the stipulated time, basis which the revenue made an addition of INR 6.99 cr. in its return. 
The assessee contented that although a manual copy of the said form was not submitted, however, the requisite facility for its online filing was also not available at the portal. The hon’ble ITAT, in response, opined that “it is mandatory to file Form 10 manually though not electronically before the due date of filing of return of income”. 
Further pronounced that, the relevant CBDT circular does not preclude the asseesee in filing form 10, but permits only its belated electronic filing, on satisfaction of the Commissioner that the assessee was prevented by reasonable cause in doing so within the stipulated time. 
Hence, asseverated that, non-furnishing of Form 10 by the Trust is not a rectifiable error u/s 154. 

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