2015 (9) TMI 1307 - HC - Income Tax

Court orders extension of income tax filing deadline to relieve taxpayer hardships

Vishal Garg And Others Versus Union of India And Another

The court found the delay in notifying income tax return forms unreasonable, causing genuine hardship to taxpayers. It directed the Central Board of ... Extension of due date for filing returns due by 30.9.2015 where accounts are required to be audited in terms of Section 44AB - the forms were not available to the said categories of tax payers as on 1.4.2015. - petitioners inter alia submitted that it was only after 1.8.2015, 2.8.2015 and 7.8.2015 that the income tax return Forms No. 4, 5 and 6 respectively were available for downloading by the assessees In such circumstances, the last date fixed for e-filing of income tax return for the assessment year 2015-16 by the assessees, being 30.9.2015 is unreasonable and is liable to be extended. Held that:- A Single Bench of the Delhi High Court in Avinash Gupta vs. Union of India and others, [2015 (9) TMI 1123 - DELHI HIGH COURT], had the occasion to consider the issue relating to extension of time for e-filing of return beyond 30th September 2015. The writ petition was dismissed but certain observations were recorded therein that the prescribed format to be filed alongwith the return should be notified by Ist day of the assessment year. - We are in agreement with the above observations but express our dissent with regard to rejection of prayer for extension of time in e-filing the returns beyond 30th September 2015. As noticed above, we have already expressed our dissent with the order passed by the Delhi High Court qua dismissing the writ petition with regard to extension of time for e-filing of the income tax returns. Accordingly, we are unable to concur with the view expressed by the Rajasthan High Court which relied upon the decision of Delhi High Court. Taking the totality of facts and circumstances of the case, it is considered appropriate to extend the due date for e-filing of returns upto 31st October 2015 for which the CBDT shall issue appropriate notification/instructions under Section 119 of the Act. Direction is also issued to the respondents to ensure that the forms etc. which are to be prescribed for the audit report and for e-filing the returns should ordinarily be made available on the first day of April of the assessment year. - Decided in favor of petitioners. Issues Involved:1. Validity of the Press Release dated 9.9.2015 regarding non-extension of the due date for filing returns.2. Delay in notifying the prescribed income tax return forms.3. Scope of the powers of the Central Board of Direct Taxes (CBDT) under Section 119 of the Income Tax Act, 1961.4. Scope of the High Court's jurisdiction under Articles 226/227 of the Constitution of India.5. Precedents and analogous judgments from other High Courts on similar issues.Issue-wise Detailed Analysis:1. Validity of the Press Release dated 9.9.2015:The petitioners challenged the Press Release dated 9.9.2015, which decided not to extend the due date for filing returns due by 30.9.2015 for certain categories of assessees, including companies, firms, and individuals engaged in proprietary business/profession whose accounts are required to be audited under Section 44AB of the Income Tax Act, 1961. The petitioners argued that the delay in notifying the income tax return forms caused grave prejudice to the tax payers, making the deadline unreasonable.2. Delay in Notifying the Prescribed Income Tax Return Forms:The petitioners highlighted that the income tax return forms for various categories of taxpayers were notified late, specifically on 1.8.2015, 2.8.2015, and 7.8.2015 for Forms No. 4, 5, and 6, respectively. This delay left insufficient time for the assessees to file their returns by the due date of 30.9.2015. The respondents admitted that no assessees in these categories could have filed their returns before these dates, acknowledging the delay.3. Scope of the Powers of the CBDT under Section 119 of the Income Tax Act, 1961:Section 119 empowers the CBDT to issue orders, instructions, and directions for the proper administration of the Act and to address genuine hardships faced by taxpayers. The Board can extend deadlines and relax provisions to avoid undue hardship. The court noted that the CBDT had previously extended deadlines in similar situations due to difficulties in e-filing audit reports.4. Scope of the High Court's Jurisdiction under Articles 226/227 of the Constitution of India:The court examined its jurisdiction under Articles 226/227, emphasizing that it can intervene in cases where subordinate authorities act without jurisdiction, violate principles of natural justice, or cause manifest injustice. The court observed that its power is not to be used routinely but in extraordinary situations where other remedies are inadequate.5. Precedents and Analogous Judgments from Other High Courts:The court referred to similar cases, including:- Tax Bar Association, Hisar vs. The State of Haryana and others: The court extended the deadline for filing returns under the Haryana Value Added Tax Act, 2003.- Avinash Gupta vs. Union of India and others: The Delhi High Court dismissed a similar petition but acknowledged the need for timely notification of forms.- All Gujarat Federation of Tax Consultants vs. Central Board of Direct Taxes: The Gujarat High Court extended the due date for filing returns, emphasizing the CBDT's powers to avoid genuine hardship.Conclusion:The court concluded that the delay in notifying the forms was unreasonable and caused genuine hardship to the assessees. It directed the CBDT to extend the due date for e-filing of returns to 31st October 2015 and to ensure that forms are made available by the first day of April of the assessment year. The court's decision emphasized the need for timely notification of forms and the CBDT's responsibility to address taxpayer hardships.