Taxpoint: Submission of Audit Report along with Income Tax Return is not Mandatory

Submission of Audit Report along with Income Tax Return is not Mandatory – ITAT

IN THE INCOME TAX APPELLATE TRIBUNAL

The Relevant Text of the Order as follows :

7.6 The CBDT Circular No.14 (XL-35) dated 11.04.1955 has clarified that the revenue shall not take advantage of the ignorance of the assessee and the A.O. shall assist the taxpayer for claiming of his legitimate allowance/disallowance. As mentioned earlier, deduction u/s 10B and 10A of the I.T.Act is pari-materia. When claiming u/s 10B of the I.T.Act was denied, the assessee made alternative claim u/s 10A of the I.T. Act. The alternative claim of deduction u/s 10A of the I.T.Act was not considered by the A.O. nor the CIT(A).

In the interest of justice and equity, the issue of claim of deduction u/s 10A of the I.T.Act is restored to the A.O. The A.O. shall examine whether the assessee has satisfied the conditions mentioned for claiming deduction u/s 10A of the I.T.Act and accordingly grant deduction. The assessee had filed an audit report in Form No. 56F for claiming the alternative claim of deduction u/s 10A of the I.T. Act.

The provision regarding the filing of audit reports along with the return of income is the only directory and not mandatory. The audit report can be filed either during the course of assessment proceedings or during the appellate proceedings. In this context, I rely on the judgment of the Hon’ble Delhi High Court in the case of CIT v. Web Commerce (India) Private Limited reported in (2009) 318 ITR 135 (Del.) Therefore, even if the audit report is not filed in Form No.56F along with the original return, it is not fatal, provided the assessee subsequently files the same and satisfy all other conditions mentioned for claiming deduction u/s 10A of the I.T.Act. It is ordered accordingly.

Read Order

Tags: Judgement, Appellant Tribunal, Income Tax