Filing Statutory Forms Within Specified Time To Avail Tax Benefits: Whether Mandatory Or Directory?

The Courts in the past have had numerous occasions to deal with the issue of whether the filing of statutory forms within the due date prescribed under the Income Tax Act, 1961 ('IT Act'), is a mandatory or directory requirement, to claim deductions/exemptions that are available to Taxpayers under the IT Act.

In AKS Alloys (P.) Ltd.¹, the Taxpayer's claim for deduction under Section 80IB of the IT Act was denied by the Tax Authorities, on the grounds that the Assessee did not file audit report in Form 10CCB along with the return of income ('RoI') as required under Section 80IB(13) read with Section 80IA(7) of the IT Act. In a challenge to the High Court, relying on catena of judgments², the High Court held that the requirement to file the audit report within the specified time was directory and not mandatory in nature and thus, upheld the eligibility for deduction under Section 80IB. The said decision of the High Court was also subsequently affirmed by the Apex