1 rpa IN THE HIGH COURT OF JUDICATURE AT BOMBAY IN THE HIGH COURT OF JUDICATURE AT BOMBAY IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION ORDINARY ORIGINAL CIVIL JURISDICTION ORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO. 399 OF 2006 INCOME TAX APPEAL NO. 399 OF 2006 INCOME TAX APPEAL NO. 399 OF 2006 The Darukhan Iron, Steel and Scrap Merchant Association, Mumbai .. Appellant V/s. Income Tax Officer, New Marine Lines, Mumbai .. Respondent Mr.K.Gopal Jitendra Singh for the Appellant. Mr.Vinod Gupta for Respondent. CORAM : BILAL NAZKI AND CORAM : BILAL NAZKI AND CORAM : BILAL NAZKI AND S.S.SHINDE, JJ. S.S.SHINDE, JJ. S.S.SHINDE, JJ. DATE : 20TH JUNE, 2008. DATE : 20TH JUNE, 2008. DATE : 20TH JUNE, 2008. P.C.:- P.C.:- P.C.:- . Admit. 2. This matter is taken up for final disposal with the consent of the learned counsel for the parties. 3. Following questions have been framed : i. Whether the Appellate Tribunal is justified in confirming denial of exemption u/s.11 of the Act to the 2 Appellant on the ground that the certificate in Form 10B was not furnished alongwith the return of income and not directory ? ii. Whether the Appellate Tribunal is correct in law in holding that the condition of filing the certificate in Form 10B alongwith the return of income is mandatory ? 4. The facts leading to filing of this appeal are, the assessee/appellant is the charitable institution since 1991 and was issued a certificate in Form 10B for the assessment year 2001-2002 for which assessment was taken up by the Assessing Authority. 5. Till November, 2003, the Appellant had not received the certificate in terms of Form 10B and therefore, the exemption in terms of section 11 was not granted to it. The Appellant filed an Appeal and during the pendency of the Appeal, it obtained certificate in Form 10B and filed an application requesting the Authority to take into consideration the certificate in Form 10B. That application was rejected. The assessee went to the Tribunal and the Tribunal also did not consider the submission of the 3 Appellant and also did not take into consideration the certificate in Form 10B. Therefore, this appeal. 6. In this background, the questions referred to above have been raised. There is a circular issued in the year 1978 being Instruction No.1/1148 by the Central Board of Direct Taxes. This was issued on 9th February, 1978. The circular clearly shows that exemption under section 11 of the Act should not be rejected solely on the ground that there has been delay in filing the report by the accountant in terms of section 12B. The learned counsel for the Appellant submits that the purpose of production of certificate is to ensure that the assessee was exempted in terms of section 11 and in any case the Appellant is given an extension of the assessment. Therefore, the department could not have refused consideration of the certificate. 7. Taking into consideration the certificate issued by the department itself and the fact that the department could not issue certificate at the time when assessment was pending and therefore the Appellant could not file it at the time of assessment. Since there is no dispute about the certificate issued in form 10B and also there is no dispute that the assessee was exempt in terms of section 11, therefore, we feel 4 that the Tribunal was not right in not taking into consideration the certificate furnished by the Assessee. 8. For these reasons, we allow the Appeal and decide the questions in favour of the assessee as against department. (BILAL NAZKI, J.) (BILAL NAZKI, J.) (BILAL NAZKI, J.) (S.S.SHINDE, J.) (S.S.SHINDE, J.) (S.S.SHINDE, J.)