A procedural lapse in filing the audit report in Form 10BB instead of Form 10B cannot, by itself, defeat such substantiative entitlement as held in CITVS Rajasthan and Gujrat Charitable foundation reported at (2018) 14 SCC 348
Khushi Jain | May 8, 2026 |
Procedural lapse in filing audit report cannot lead to denial of Income Tax Exemption: High Court
The Howrah Heritage Society, a charitable trust registered under Section 12A of the Income Tax Act, faced a problem because its auditor mistakenly filed the audit report in Form 10BB instead of the required Form 10B, and the trust later applied for condonation of delay and correction.
The trust argued that this was only a procedural mistake and should not affect its right to exemption, while the authorities said the application was still under process and within the time limit set by Circular No. 16/2024.
The Court held that such a procedural lapse cannot take away the substantive right of exemption, and since the application was pending, the authority must decide it within the prescribed time.
Therefore, the Court directed the concerned authority to dispose of the application by 30th June 2026 with a proper reasoned order after hearing the petitioner, and disposed of the writ petition without going into the merits.
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