Form 10-IEA Prevails Over An Inconsistent ITR Selection; Corresponding Old-regime Deductions Must Be Allowed

Mumbai ITAT held that Form 10-IEA, being the prescribed statutory form for opting out of the new tax regime, would prevail over an inconsistent option selected in the return of income. Further, it has been held that where the Revenue applies the old tax regime based on Form 10 IEA, it must correspondingly allow all eligible deductions availableunder that regime.

BRIEF FACTS OF THE CASE¹

• The Assessee, an individual having business or professional income, had opted for the new tax regime for Assessment Year 2024-25. For AY 2025-26, he filed Form 10-IEA to opt out of the new tax regime and be assessed under the old tax regime. However, while filing the return, he selected “No” against the question asking whether he wished to opt out of the newtaxregime.