Section 115BAA Benefit Allowed Despite Wrong Form Filing | ITAT

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Section 115BAA Benefit

Case Details: ACIT v. Magik Kraft (P.) Ltd. [2025] 179 taxmann.com 632 (Mumbai-Trib.)

Judiciary and Counsel Details

  • Sandeep Gosain, Judicial Member & Prabhash Shankar, Accountant Member
  • Annavaran Kosuri, Sr. AR for the Appellant.
  • Vimal Punmiya for the Respondent.

Facts of the Case

The assessee-company filed its return of income for the relevant assessment year 2023-24, opting for reduced taxation under section 115BAA. However, the Centralized Processing Center (CPC) raised demand for tax calculated at a higher rate as the assessee inadvertently filed Form 10-IB instead of the prescribed Form 10-IC. The assessee filed the Form 10-IC manually and submitted the tax calculation sheet before the AO.

The matter reached the Mumbai Tribunal.

ITAT Held

The Tribunal held that the substantive benefits conferred by the statute cannot be denied merely on account of technical or procedural lapses. Section 115BAA of the Act is a substantive provision granting eligible companies the right to be taxed at a concessional rate of 22%. The requirement to file Form 10-IC under Rule 21AE is a procedural formality intended to operationalise the substantive right.

Where the assessee satisfies all substantive conditions under section 115BAA, the mere fact of filing an incorrect form (Form 10-IB instead of 10-IC) cannot disentitle it from the benefit. The assessee had fully complied with the substantive conditions prescribed under Section 115BAA of the Income Tax Act, 1961. The inadvertent filing of Form 10-IB in place of Form 10-IC is a purely technical lapse, which has since been duly rectified by filing the correct Form 10-IC electronically and manually before the jurisdictional Assessing Officer in compliance with the directions of the Learned CIT(A).

Procedural defects should not defeat substantive rights when all eligibility conditions are met. Furthermore, the CBDT itself, through various circulars, has recognised that such defects in filing Form 10-IC are condonable in nature, and taxpayers should not be denied the lawful benefit of the concessional regime merely due to technical or inadvertent errors.

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Author: Taxmann

Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.

The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:

  • The statutory material is obtained only from the authorized and reliable sources
  • All the latest developments in the judicial and legislative fields are covered
  • Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
  • Every content published by Taxmann is complete, accurate and lucid
  • All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
  • The golden rules of grammar, style and consistency are thoroughly followed
  • Font and size that's easy to read and remain consistent across all imprint and digital publications are applied