Nine-Day Delay in Filing Form 10-IE Cannot Justify Denial of Section 115BAC Benefit: ITAT Amritsar

Case Overview

Background and Facts of the Case

The Amritsar Bench of the Income Tax Appellate Tribunal (ITAT) recently adjudicated a significant question concerning the denial of the concessional tax regime available under Section 115BAC of the Income-tax Act, 1961, solely on the ground that Form No. 10-IE was filed nine days beyond the prescribed deadline.

The assessee had originally submitted his return of income under the old tax regime, availing deductions permissible under Chapter VI-A of the Act. At a subsequent stage, he opted for taxation under the new concessional regime governed by Section 115BAC and accordingly filed a revised return. The extended compliance deadline applicable for Assessment Year 2021-22 was 15.03.2022, while Form No. 10-IE was actually furnished on 24.03.2022, resulting in a delay of approximately nine days.

The assessee's position was that the short delay arose entirely from technical glitches and functional difficulties encountered on the income-tax e-filing portal during the relevant period. It was contended that Form No. 10-IE was submitted at the earliest possible opportunity once the relevant filing utility became operational. The assessee further placed reliance on successive CBDT circulars that had formally acknowledged electronic filing difficulties and consequently extended various statutory compliance timelines — including Circular No. 1/2022, which had extended the due date for Assessment Year 2021-22 to 15.03.2022 in recognition of difficulties reported by assessees and other stakeholders.

Action Taken by Lower Authorities

At CPC Level — Processing Under Section 143(1)

While processing the return under Section 143(1) of the Income-tax Act, 1961, the Centralised Processing Centre (CPC) declined to extend the benefit of the lower rate of tax under Section 115BAC. The basis for this denial was straightforward — Form No. 10-IE had not been furnished within the prescribed due date of 15.03.2022.

At CIT(A) Level — Proceedings Under Section 250

The assessee challenged the CPC's action before the learned Addl./JCIT(A) under Section 250 of the Act. However, the first appellate authority confirmed the CPC's position. The CIT(A) held that for Assessment Year 2021-22, the assessee was obligated to communicate his intention to opt for the new tax regime by filing the prescribed form within the stipulated time period. Since Form No. 10-IE was admittedly filed after the due date, the CIT(A) concluded that determination of tax liability under the old regime was justified and dismissed the grounds of appeal accordingly.

Arguments Advanced Before the ITAT

Assessee's Contentions

The learned Authorised Representative (AR) advanced the following key arguments before the Tribunal: