The Commissioner rejected my condonation application for late Form 9A for an old year. Was Form 9A even required then?
Not before AY 2016-17. The Bombay High Court held that the requirement to file Form No. 9A to exercise the option under clause (2) of the Explanation to s.11(1) was introduced by the Finance Act 2015 with effect from 1 April 2016, so for AY 2015-16 there was no prescribed format and no delay capable of being condoned. Where the option had been exercised in time by stating it in the Form 10B audit report and in the return, the substantive requirement was met and the s.119(2)(b) rejection was quashed.
Decided by the High Court (B. P. Colabawalla J and Amit S. Jamsandekar J) on 2025-11-11, reported as Writ Petition (L) No. 28779 of 2025; Neutral Citation 2025:BHC-OS:20844-DB (Bombay High Court). It bears on section 11, section 11(1), section 119(2)(b), section 139(1), section 12A of the Income Tax Act 1961, in Charitable Trusts & Exemption and Capital Gains Exemptions matters.
Two things make this worth carrying. First, it is the only decision in this library on Form 9A, the option that treats income not received, or not applied for a reason, as applied. Second, the reasoning tells you what a valid exercise of the option looks like when the electronic form is not the point in dispute — a statement of the option in the audit report and the return, made within the time allowed, laying the foundation for it. The holding itself is confined to years before AY 2016-17: from AY 2016-17 the Form is prescribed and the timing was tightened again by later Finance Acts, so this is not authority that a late Form 9A can be ignored for a current year. What survives for current years is the approach — where the option was in substance exercised in time, denial produces genuine hardship within s.119(2)(b).
Binding within that High Court's jurisdiction. Persuasive elsewhere.
Read aloud by your device. Press again to stop.
The petitioner is a registered charitable trust running low-cost health centres in Mumbai. It received a grant of Rs.2,47,66,000 on 23 March 2015, eight days before the end of the financial year, and could not apply it within that year; the whole amount was applied during FY 2015-16. For AY 2015-16 it exercised the option under clause (2) of the Explanation to s.11(1) by stating it in its audit report in Form No. 10B and in its return of income, both filed on 12 September 2015, within time. A Form No. 9A was later filed on 30 September 2023. By order dated 12 March 2025 the Commissioner rejected the application under s.119(2)(b), holding the Form No. 9A to be late and treating it as mandatory even for AY 2015-16, and holding that it should have been filed manually for that year. A demand had been raised in an earlier round of assessment proceedings, and de novo assessment proceedings were then pending.
The order dated 12 March 2025 under s.119(2)(b) was quashed and set aside, because there was no requirement to file Form No. 9A for AY 2015-16 and it could not therefore be said that the petitioner had delayed filing it, the option under clause (2) of the Explanation to s.11(1) having been exercised within time under the law then prevailing (paragraph 13). The respondents were directed to process the return for AY 2015-16 in the pending de novo assessment proceedings on the footing that the option had been exercised within time (paragraph 14), and rule was made absolute with no order as to costs (paragraph 15).
The requirement to file Form No. 9A was introduced by the Finance Act 2015 with effect from 1 April 2016, and the petition concerned the earlier AY 2015-16, for which there was no prescribed format for exercising the option; under the law as it then stood the petitioner had laid the necessary foundation by stating the option in its Form No. 10B audit report and in its return of income, both filed in time (paragraph 11). Both sides had drawn attention to CBDT Circular No. 19 of 2015 dated 27 November 2015, the explanatory notes to the Finance Act 2015, which states that there was no standard format for exercising the option for assessment years before AY 2016-17 and that the amendment to s.11 applies from AY 2016-17 onwards (paragraph 10). The impugned order was therefore wrong in holding that Form No. 9A had to be filed manually for AY 2015-16 (paragraph 12), and refusing relief would cause genuine hardship because the petitioner would be saddled with the large demand raised in the earlier round even though it had substantially complied with clause (2) of the Explanation (paragraph 12). The Court applied its own reasoning on Form No. 10 in KSB Care Charitable Trust, that the benefit of accumulation ought not to be denied where the accumulated amount has actually been applied to charitable purposes within the time allowed and the activities are genuine; here the whole amount was applied in FY 2015-16 (paragraph 9).
In view of the foregoing discussion, we quash and set aside the impugned order dated 12.03.2025 passed by Respondent No.1 as there was no requirement to file Form No.9A for A.Y. 2015-16 and therefore it cannot be said that the Petitioner had delayed the filing of Form No.9A.
Upload it and we will read it, work out your deadline and draft the reply. A CA reviews before anything is filed.
Handle my notice → Ask a CA on WhatsAppNot before AY 2016-17. The Bombay High Court held that the requirement to file Form No. 9A to exercise the option under clause (2) of the Explanation to s.11(1) was introduced by the Finance Act 2015 with effect from 1 April 2016, so for AY 2015-16 there was no prescribed format and no delay capable of being condoned. Where the option had been exercised in time by stating it in the Form 10B audit report and in the return, the substantive requirement was met and the s.119(2)(b) rejection was quashed. This was decided by the High Court (B. P. Colabawalla J and Amit S. Jamsandekar J) and bears on section 11, section 11(1), section 119(2)(b), section 139(1), section 12A of the Income Tax Act 1961. It is reported as Writ Petition (L) No. 28779 of 2025; Neutral Citation 2025:BHC-OS:20844-DB (Bombay High Court). Two things make this worth carrying. First, it is the only decision in this library on Form 9A, the option that treats income not received, or not applied for a reason, as applied. Second, the reasoning tells you what a valid exercise of the option looks like when the electronic form is not the point in dispute — a statement of the option in the audit report and the return, made within the time allowed, laying the foundation for it. The holding itself is confined to years before AY 2016-17: from AY 2016-17 the Form is prescribed and the timing was tightened again by later Finance Acts, so this is not authority that a late Form 9A can be ignored for a current year. What survives for current years is the approach — where the option was in substance exercised in time, denial produces genuine hardship within s.119(2)(b). If it applies to you, the first step is this: Fix the assessment year first. For any year before AY 2016-17 there was no prescribed format, and the answer is that no Form 9A was due — say so instead of applying for condonation.
The petitioner is a registered charitable trust running low-cost health centres in Mumbai. It received a grant of Rs.2,47,66,000 on 23 March 2015, eight days before the end of the financial year, and could not apply it within that year; the whole amount was applied during FY 2015-16. For AY 2015-16 it exercised the option under clause (2) of the Explanation to s.11(1) by stating it in its audit report in Form No. 10B and in its return of income, both filed on 12 September 2015, within time. A Form No. 9A was later filed on 30 September 2023. By order dated 12 March 2025 the Commissioner rejected the application under s.119(2)(b), holding the Form No. 9A to be late and treating it as mandatory even for AY 2015-16, and holding that it should have been filed manually for that year. A demand had been raised in an earlier round of assessment proceedings, and de novo assessment proceedings were then pending. The matter was decided on 2025-11-11 by the High Court (B. P. Colabawalla J and Amit S. Jamsandekar J). On those facts the High Court held as follows. The order dated 12 March 2025 under s.119(2)(b) was quashed and set aside, because there was no requirement to file Form No. 9A for AY 2015-16 and it could not therefore be said that the petitioner had delayed filing it, the option under clause (2) of the Explanation to s.11(1) having been exercised within time under the law then prevailing (paragraph 13). The respondents were directed to process the return for AY 2015-16 in the pending de novo assessment proceedings on the footing that the option had been exercised within time (paragraph 14), and rule was made absolute with no order as to costs (paragraph 15).
The requirement to file Form No. 9A was introduced by the Finance Act 2015 with effect from 1 April 2016, and the petition concerned the earlier AY 2015-16, for which there was no prescribed format for exercising the option; under the law as it then stood the petitioner had laid the necessary foundation by stating the option in its Form No. 10B audit report and in its return of income, both filed in time (paragraph 11). Both sides had drawn attention to CBDT Circular No. 19 of 2015 dated 27 November 2015, the explanatory notes to the Finance Act 2015, which states that there was no standard format for exercising the option for assessment years before AY 2016-17 and that the amendment to s.11 applies from AY 2016-17 onwards (paragraph 10). The impugned order was therefore wrong in holding that Form No. 9A had to be filed manually for AY 2015-16 (paragraph 12), and refusing relief would cause genuine hardship because the petitioner would be saddled with the large demand raised in the earlier round even though it had substantially complied with clause (2) of the Explanation (paragraph 12). The Court applied its own reasoning on Form No. 10 in KSB Care Charitable Trust, that the benefit of accumulation ought not to be denied where the accumulated amount has actually been applied to charitable purposes within the time allowed and the activities are genuine; here the whole amount was applied in FY 2015-16 (paragraph 9). In the words reproduced by the source cited on this page: "In view of the foregoing discussion, we quash and set aside the impugned order dated 12.03.2025 passed by Respondent No.1 as there was no requirement to file Form No.9A for A.Y. 2015-16 and therefore it cannot be said that the Petitioner had delayed the filing of Form No.9A." The decision followed or applied KSB Care Charitable Trust v. CIT (Exemption), Mumbai, Writ Petition (L) No. 23591 of 2025 (Bombay, 22 September 2025) — applied; CBDT Circular No. 19 of 2015 dated 27 November 2015 (Explanatory Notes to the Provisions of the Finance Act, 2015) — relied on by both sides.
It was decided by the High Court on 2025-11-11 and is reported as Writ Petition (L) No. 28779 of 2025; Neutral Citation 2025:BHC-OS:20844-DB (Bombay High Court). Binding within that High Court's jurisdiction. Persuasive elsewhere. A High Court decision binds the assessing officer, the Commissioner (Appeals) and the Income Tax Appellate Tribunal within that state, and is persuasive elsewhere. If your assessment is in a different jurisdiction, check whether your own High Court has taken the same view before relying on it. On section 11, section 11(1), section 119(2)(b), section 139(1), section 12A, the practical question is whether the facts of your own notice match the facts of this case closely enough for the same rule to apply.
It helps the taxpayer. The order dated 12 March 2025 under s.119(2)(b) was quashed and set aside, because there was no requirement to file Form No. 9A for AY 2015-16 and it could not therefore be said that the petitioner had delayed filing it, the option under clause (2) of the Explanation to s.11(1) having been exercised within time under the law then prevailing (paragraph 13). The respondents were directed to process the return for AY 2015-16 in the pending de novo assessment proceedings on the footing that the option had been exercised within time (paragraph 14), and rule was made absolute with no order as to costs (paragraph 15). It arises in Charitable Trusts & Exemption and Capital Gains Exemptions matters, on section 11, section 11(1), section 119(2)(b), section 139(1), section 12A of the Income Tax Act 1961, and was decided by B. P. Colabawalla J and Amit S. Jamsandekar J. Before relying on it, read the source linked on this page and check whether it has since been distinguished, overruled or overtaken by an amendment to the Income Tax Act. In practice the steps that follow from it are these. For such a year, produce the audit report in Form No. 10B and the return, both filed within time, showing the option stated on their face; that is the foundation the Court looked for. Cite CBDT Circular No. 19 of 2015 dated 27 November 2015, the explanatory notes to the Finance Act 2015, which records that there was no standard format for exercising the option for years before AY 2016-17 and that the amendment applies from AY 2016-17 onwards. For AY 2016-17 onwards, do not rely on this decision for the proposition that the Form is optional — check the text of clause (2) of the Explanation as substituted for the year in question and apply for condonation under s.119(2)(b) on the hardship reasoning.
Validity check could not be completed. Validity check could not be completed; no later treatment was searched for. The holding is in terms confined to AY 2015-16 and to the period before the Finance Act 2015 requirement took effect. The text of clause (2) of the Explanation to s.11(1) was substituted, and the timing tightened, by later Finance Acts; this entry states no position on the current text, which was not read from a current source. No source could be cited for that finding. Checking whether an authority still stands matters as much as knowing what it held: a decision may be overruled on one point and survive on another, or the provision it interprets may have been amended since. Read the source and the editor's note on this page before relying on it in a reply to an Assessing Officer or in an appeal.
The order runs to sixteen numbered paragraphs. Paragraphs 9 to 16 were transcribed in full from the plain /doc/ URL and the operative sentence at paragraph 13 was re-checked through /docfragment/ and came back word for word. Paragraphs 1 to 8 were not transcribed; the facts below are taken from paragraphs 9 to 13 and from a fragment of the petitioner's case recovered separately, so the procedural history before the impugned order is thinner than usual and the amount of the grant is stated as read from the first pass, not from a transcribed paragraph. Paragraph 9 cites this Court's own KSB Care Charitable Trust decision (Writ Petition (L) No. 23591 of 2025, 22 September 2025) at its paragraph 23; that is a locator inside a cited judgment, not inside this one. This library shows the verification state of every entry openly. This entry has not yet been read in full by a chartered accountant. The summary reflects the sources listed on this page. Read the source before you rely on it in a reply to an Assessing Officer or in an appeal before the Commissioner (Appeals) or the Income Tax Appellate Tribunal.
The order dated 12 March 2025 under s.119(2)(b) was quashed and set aside, because there was no requirement to file Form No. 9A for AY 2015-16 and it could not therefore be said that the petitioner had delayed filing it, the option under clause (2) of the Explanation to s.11(1) having been exercised within time under the law then prevailing (paragraph 13). The respondents were directed to process the return for AY 2015-16 in the pending de novo assessment proceedings on the footing that the option had been exercised within time (paragraph 14), and rule was made absolute with no order as to costs (paragraph 15).
Every entry in this library links to where it was found, so you can check it yourself rather than take our word for it.
We charge fees for our public utility work. Does that cost us charitable status under s.2(15)?
Our trust was formed weeks ago and has done nothing yet. Can registration be refused for that?
The CBDT rejected my condonation application without dealing with my reasons. Can I challenge that?
We treated a building's full cost as application of income. Can we also claim depreciation on it?