ORDER :

Mauna M. Bhatt, J.

1. This petition is filed challenging the order dated 12.3.2021,passed by respondent under Section 119(2)(b) of Income Tax Act, 1961 (“The Act” for short), wherein application of the assessee to condone the delay in e-filing the audit report in Form No.10B for Assessment Year 2016-17,has been rejected.

Facts:

2. Petitioner is a Public Charitable Trust registered with the Charity Commissioner as well as Income-tax authorities. Petitioner is a Social Security Scheme of Gujarat Institute of Civil Engineers and Architects which pools contribution from registered civil engineers and architects to disburse to the family members in case of death. It is the case of the petitioner that it has been filing returns of income in time along with audit report under Section 12A(1)(B) of the Act. For the assessment year 2016-2017, the petitioner obtained audit report from Chartered Accountant well before the time limit. However, though the audit report in Form 10B for A.Y. 2016-17 was required to be filed along with return of income, the same could not be uploaded along with return of income inadvertently. In absence of any audit report the Central Processing Centre had not granted exemption under Section 11 of the Act which otherwise was available to it since many years and resultantly demand of Rs.16,39,950/- was raised. The petitioner therefore filed a rectification application u/s 154 of the Act seeking to place on record audit report to the Central Processing Centre but the same was rejected vide order dated 25.1.2019. The reason given in the order dated 25.1.2019 was that Form No.10B audit report, was not filed in time. Relying upon instructions of board, the petitioner filed an application before the CBDT to condone the delay in filing Form No.10B audit report. The same has been rejected, aggrieved by which, the present petition is filed.

Submissions of the petitioner:

3. Heard Mr. B.S. Soparkar, learned advocate for the petitioner. He submitted that the order passed by the respondent dated 12.3.2020 is bad in law because as per CBDT circular No.10 dated 22.5.2019, the Commissioner of Income-tax is required to condone the delay for a reasonable cause. In this case the cause shown by the petitioner is reasonable as it is out of inadvertence, that Form 10B report could not be filed along with return, though the same was obtained before due date of return. The petitioner came to know about the default in filing Form No.10B audit report upon receipt of the intimation under Section 143(1) rejecting the claim of exemption under Section 11 of the Act. He further submitted that merely non-filing of Form No.10B report, for which, the assessing officer could not take up the return filed by the petitioner in scrutiny could not be a ground for denial of exemption. In support of his submission, he relied upon the decision of this Court in the case of Sarvodaya Charitable Trust vs. Income Tax Officer (Exemption) in R/Special Civil Application No.6097 of 2020 dated 9.12.2020. He further submitted that the petitioner is otherwise a charitable organization and eligible for exemption u/s 11, as it has received the same benefits since many years. The demand of Rs.16,39,948/- is erroneously raised as the application filed by the petitioner under Section 119(2)(b) of the Act is rejected. He thus submitted that the petition being meritorious, the same may be allowed and the impugned order may be quashed and set aside.

Submissions of the Respondent:

4. Appearing for the respondent, learned senior standing counsel Mr. Maithali Mehta, submitted that in this case the petitioner filed its return of income for A.Y.2016-2017, on 24.8.2016. The due date for filing of Form No.10B was 30.9.2016, which was extended up to 17.10.2016, however, the petitioner sought to file the same on 28.8.2018 which was late by 680 days. The petitioner filed an application u/s.119(2)(b) of the Act seeking condonation of delay in filing audit report in Form No.10B. How