On July 31, 2024, the Income Tax Appellate Tribunal in Delhi allowed B R Hospital Research Institute to claim the section 11 exemption for the assessment year 2018‑19, even though the trust had filed its audit report in Form 10B after the prescribed time limit. The tribunal distinguished the case from the earlier Wipro Limited decision, treating the requirement to file the report as directory rather than mandatory. As part of its order, the ITAT Delhi remitted grounds 8 and 9 of the appeal for a fresh, de novo assessment.
On May 6, 2025, the ITAT Pune upheld an appeal by Sahaj Seva Trust, ruling that the late submission of Form 10B did not deny the trust’s entitlement to exemption under Sections 11 and 12 of the Income‑tax Act, 1961 for the assessment year 2014‑15. The Pune bench relied on precedents from other tribunals and courts to conclude that the filing obligation is directory, meaning that a delay does not by itself invalidate the exemption claim.
The two rulings focus on whether the obligation to file the audit report by a set deadline is a strict prerequisite or a procedural guideline, with both tribunals answering in favour of the latter.
These decisions clarify that a belated Form 10B filing does not automatically forfeit a trust’s tax‑exempt status.
These decisions clarify that a belated Form 10B filing does not automatically forfeit a trust’s tax‑exempt status. By treating the reporting requirement as directory, the tribunals give trusts a chance to substantiate their eligibility for exemption even when the paperwork arrives late. The decisions also highlight the importance of procedural compliance in tax exemptions, since the tribunals weighed the timeliness of the filing against the broader question of whether the trust should be permitted to claim the exemption at all.
Bharat retired. He received ₹8.49 lakh as leave encashment. But his Form 16 didn't contain the exemption amount. Tax officer taxed it and demanded ₹2 lakh in tax. But here's how ITAT Pune saved him.🧵👇