Form 10B used for rectify mistakes

Form 10B for rectify mistakes


Form 10B enables a taxpayer to file an audit report if the taxpayer has applied for or is already registered as charitable or religious trust / institution by filing Form 10A. Form 10B is accessed by the CA added by the taxpayer under the My CA service and is assigned the relevant form.

Form 10B is to be furnished by a trust or institution that has been registered u/s 12A or who has submitted an application for registration by filing Form 10A.

Form 10B is an audit report which is provided by a CA upon nomination by the taxpayer. Form 10B can be accessed and submitted in the online mode only and it is to be filed on or before the specified date referred to in Section 44AB, i.e., a month prior to the due date for furnishing the Return of Income under sub-section (1) of Section 139.

Prerequisites for availing this service 

  • Taxpayer and CA are registered users of the e-Filing portal
  • Status of PAN of taxpayer and CA is Active
  • Taxpayer has added CA for Form 10B through My CA service
  • Valid, registered and active Digital Signature Certificate (DSC) of the CA
  • Taxpayer must have applied for registration or already obtained registration as charitable or religious trust / institution under section 12A by filing Form 10A and accordingly Form 10B is made available under the login of the taxpayer

Purpose of the Form:

Audit Report u/s 12A(1)(b) has to be filed by a charitable or religious trust or institution who has been granted registration under Section 12A or which has submitted an application for registration by filing Form 10A.

The Audit Report is required to be filed if the total income of the entity for the relevant previous year has exceeded the maximum amount which is not chargeable to tax, to claim exemption under Sections 11 and 12 of the Act.

Who can use Form 10B?

CAs who are registered users on the e-Filing portal can access Form 10B. Further, the CAs must be assigned the form by the taxpayer in order to access, edit, review and submit it.

When is Form 10B required to be filed?

When the total income of a trust or institution is computed without giving effect to Sections 11 and 12 and exceeds the maximum amount not chargeable to income tax in any given financial year, the accounts for the year has to be audited by a CA.

This requires the person to furnish the receipt of the said income along with the return of the income, the report of such audit in Form 10B duly signed and verified by the CA.

Is it mandatory to file Form 10B online?

Yes, with effect from AY 2020-21, it is required that Form 10B is mandatorily filed in the online mode only.

How to rectify mistake in Audit Report Form 10B?

The Income Tax Appellate Tribunal (ITAT) has held that the clerical mistakes in audit report form 10B can be rectified and the same shall not be a ground to deny tax exemption to the assessee

Along with filing of return of income, the assessee, Form-10B is uploaded which is audit report under section 12A(b) of the Act.

However, in the return of income, the assessee claimed exempt income under section 10(23C) instead of claiming the same under section 12A of the Act.

The CPC rejected the claim of the assessee under section 10(23C) by holding that the assessee had not obtained the necessary approval from the prescribed authority and the receipts of the assessee exceeded Rs.1.00 crore.

The application for rectification under section 154 was also rejected and on appeal before ld. CIT(A), the ld. CIT(A) also dismissed the appeal of the assessee by first holding that there was no mistake apparent from record and further held that there is lot of difference between the claim of exemption under section 10(23C) and Section 11 of the Income Tax Act.

The department was of the view that filing of return is done by the professionals and therefore it cannot be accepted that the mistake had happened due to mistake by a Clerk.

On appeal, the first appellate authority confirmed the original order.

Further the uploading of Form-10B which is a audit report u/s.12A(b) of the Act, proves that the mistake committed by assessee in claiming exemption u/s.10(23C) is inadvertent mistake as by committing such a mistake the assessee is not going to gain anything.

Fact of the matter is that assessee is registered u/s.12A of the Act and is eligible for exemption u/s.11 of the Act. Therefore for inadvertent mistake the assessee cannot be penalized.

Since the assessee has been claiming exemption u/s.10(23C) in the earlier years therefore during the year under consideration there is high probability that assessee again claimed exemption u/s.10(23C) by overlooking the fact that it had already got registration u/s.12A of the Act which in any case was available with the assessee before the filing of return of income. The mistake has occurred as a human error and should have been judicially considered


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