CBDT extends due date to claim concessional corporate tax rate till 30th June 2022

Last Updated On: March 19, 2022, 7:32 p.m.
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CBDT PROVIDES CONDONATION OF DELAY IN FILING FORM 10-IC

What is Form 10-IC?

Form 10-IC is an optional form required to file only if a Domestic Company chooses to pay tax at a concessional rate of 22% under Section 115BAA of the Income Tax Act,1961.

 

 

What is the purpose of filing Form 10-IC?

As per Section 115BAA of the Income Tax Act, Domestic Companies have the option to pay tax at a concessional rate of 22% (plus applicable surcharge and cess) provided they do not avail of specified deductions and incentives. Companies can opt for the concessional rate from the Assessment Year 2020 - 21 onwards only if they file Form 10-IC within the prescribed time limit.

 

How can I file Form 10-IC?

You can file Form 10-IC only in online mode after logging into the e-filing portal.

 

What is the time limit for filing Form 10-IC?
You will be required to file Form 10-IC on or before the due date specified under sub-section (1) of Section 139 for furnishing the returns of the income for the previous year to avail of the benefit.

 

Condonation of delay under section 119(2)(b) of the Income-tax Act, 1961 in the filing of Form 10-IC for Assessment Year 2020-21

 

CBDT issues Income Tax Circular 06/2022 | Dated: 17th March 2022 to condone the default in filing Form 10-IC to avail lower tax rate of 22% under section 115BAA for AY 2020-21. Form 10-IC can now be filed till 30 June 2022, if the Income Tax return was originally filed within due date and the option to avail lower rate has opted in ITR 6.

 

Section 1 15BAA of the Income-tax Act, 1961 (the Act) was inserted by the Taxation Laws (Amendment) Act, 2019 w.e.f. 01.04.2020. As per the Section, the income-tax payable in respect of the total income of a person, being a domestic company, for any previous year relevant to the assessment year beginning on or after the 1st day of April 2020, shall, at the option of such person be computed at the rate of twenty-two percent subject to satisfaction of conditions contained in sub-section(2) of the Section.

As per subsection (5) of section 115 I3AA of the Act read with Rule 21 AF of the Income-tax Rules, 1962 (the Rules), the assessee company is required to submit Form 10- IC electronically on or before the due date of filing of return of income u/s 139(1) of the Act and such option once exercised shall apply to subsequent assessment years.

 

In case of failure to furnish such option in the prescribed form on or before the due date specified u/s 139(1) of the Act results in denial of concessional rate of tax of twenty-two percent to such person.

Representations have been received by the Board stating that Form 10-IC could not be filed along with the return of income for AY 2020-21, which was the first year of the filing of this form. It has been requested that the delay in filing Form 10-IC may be condoned.

On consideration of the matter, with a view to avoiding genuine hardship to the domestic companies in exercising the option under section 115BAA of the Act, the Central Board of Direct Taxes, in the exercise of the powers conferred under section 119(2)(b) of the Act, hereby directs that:-


 

According to rule 21AE in the filing of Form 10-IC  of the Rules for the previous year relevant to A.Y 2020-21 is condoned in cases where the following conditions are satisfied:

  • The return of income for AY 2020-21 has been filed on or before the due date specified under section 139(1) of the Act;
  • The assessee company has opted for taxation u/s 115BAA of the Act in (e) of “Filing Status” in “Part A-GEN” of the Form of Return of Income ITR-6 and
  • Form 10-IC is filed electronically on or before 30.06.2022 or 3 months from the end of the month in which this Circular is issued, whichever is later.
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