The Income Tax Appellate Tribunal, Delhi Bench ‘A’, adjudicated the appeal filed by the assessee against the order dated 25.11.2024 passed by the Commissioner of Income Tax (Appeals), Mumbai, under Section 250 of the Income-tax Act, 1961, arising out of the intimation issued by CPC, Bengaluru under Section 143(1) for Assessment Year 2021-22.

The assessee, a charitable foundation, filed its return of income on 29.04.2024 declaring total income of ₹39,450/-. The return was processed under Section 143(1) on 20.06.2024, wherein exemption claimed under Section 11(1) amounting to ₹72,33,450/- was disallowed by CPC on the ground of delayed filing of audit report in Form 10B. The appeal filed before the CIT(A) was dismissed by an ex-parte order.

Before the Tribunal, it was submitted that the due date for filing Form 10B was 15.02.2022 and the audit report, though dated 12.01.2022, was filed on 19.02.2022, resulting in a delay of only four days. It was contended that such a minor delay was purely procedural and condonable, and that exemption under Section 11 could not be denied on this technical ground. Reliance was placed on multiple Tribunal decisions holding that filing of Form 10B is directory in nature.

The Tribunal observed that Form 10B had been obtained before filing of return and was filed prior to completion of processing under Section 143(1). Relying upon binding judicial precedents, including the decisions in Puran Chand Arora Charitable Trust, Sampoorna Seva Charitable Trust, Bhagwant Kishore Memorial Educational Society, and the principles laid down by the Hon’ble Supreme Court in CIT v. G. Knitting Industries (P) Ltd., the Tribunal held that filing of Form 10B is a procedural requirement intended to facilitate assessment and not a mandatory condition to deny statutory exemption.

The Tribunal further held that a charitable trust carrying on charitable activities over the years cannot be denied exemption merely due to a minor and condonable delay in filing Form 10B. Accordingly, the impugned orders passed by CPC and the CIT(A) were set aside and the grounds raised by the assessee were allowed. In the result, the appeal of the assessee was allowed.

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