The ITAT held that From AYs 2022-23 to 2026-27, the assessee would be eligible for exemption under section 11 of the At given the fresh registration obtained under section 12AB of the Act

In a recent case, the Delhi Bench of the Income Tax Appellate Tribunal ( ITAT) held that the requirement of filing an audit report in Form 10B is only procedural and allowed exemption under Income Tax Act, 1961. Shambhu Dayal Modern School, the appellant challenged the order of assessment passed under section 143(1) of the Income-tax Act, 1961 ( the Act ) dated 20.09.2022 by CPC, Bengaluru ( AO ). The only effective issue to be decided in this appeal is as to whether the CIT(A) was justified in confirming the denial of exemption under  section 11 of the Act by the CPC under section 143(1) of the Act in the facts. Get a Copy of Income Tax Refunds (Law & Procedure), Click here  The assessee is a society registered under section 12AA of the Act vide registration dated 08.01.2001. The return for AY 2021-22 was filed by the assessee on 31.03.2022 under section 139(4) of the Act declaring ‘Nil’ income claiming exemption 11 of the Act. In fact the last date for filing return of income for AY 2021-22 under section 139(4) of the Act was 31.03.2022 as per CBDT Circular No. 17/2021 dated 09.09.2021. The CIT(A) ignored the fact of assessee having obtained the provisional registration under section 12AB of the Act and proceeds to uphold the denial of exemption under Section 11 of the Income tax law on the ground that the assessee had not furnished the details of fresh registration obtained. Get a Copy of Income Tax Refunds (Law & Procedure), Click here The  assessee had furnished the audit report in form No. 10B along with return of income on 31.03.2022. It is fact that this filing of audit report in form 10B of the Act was filed beyond the prescribed due date i.e. 15.03.2022. In this regard, it is pertinent to note that AY 2021-22 being the first year of requirement of law to file the audit report in Form 10B 1 month prior to the due date of filing the return of income. The two member bench of M. Balaganesh Accountant Member and Anubhav Sharma , Judicial Member observed that the only reason for denial of claim of exemption under section 11 of the Act to the assessee in the instant case is for non-furnishing of fresh registration under section 12AB of the Act. It was observed that fresh registration could be granted only from the year in which application was preferred by the assessee. At the cost of repetition, the said application made by the assessee for seeking fresh registration under section 12AB of the Act is well within time allowed by CBDT. Get a Copy of Income Tax Refunds (Law & Procedure), Click here The ITAT  held that From AYs 2022-23 to 2026-27, the assessee would be eligible for exemption under section 11 of the At given the fresh registration obtained under section 12AB of the Act. Hence, for AY 2021-22 the assessee would be duly entitled for claim of exemption under Section 11 of the Income tax law.