Court allows condonation of delay in filing income tax return under Section 119(2)(b) stressing genuine hardship

The court allowed the condonation of delay in filing a revised income tax return for Assessment Year 2008-09 under Section 119(2)(b) of the Income Tax Act, emphasizing the importance of considering genuine hardship without specific CBDT instructions. The petitioner, a senior citizen, faced rejection due to lack of CBDT instructions for ex-employees of SBI, despite similar cases receiving condonation. The court overturned the decision, highlighting the authority's discretion to condone delays based on genuine hardship, setting aside the requirement for specific CBDT instructions in such cases.

---

---

Issues:
1. Condonation of delay in filing a revised return of income under Section 119(2)(b) of the Income Tax Act, 1961.
2. Genuine hardship faced by the petitioner due to rejection of the application for condonation.
3. Interpretation of Section 119(2)(b) of the Act and the requirement for specific instructions from CBDT.

Analysis:
The petitioner, a senior citizen, challenged the order rejecting her application for condonation of delay in filing a revised return of income for Assessment Year 2008-09 under Section 119(2)(b) of the Income Tax Act, 1961. The petitioner claimed exemption under Section 10(10C) of the Act for the amount received on voluntary retirement from the State Bank of India (SBI). The Commissioner of Income Tax, Thane, rejected the application citing the absence of specific instructions from the CBDT for extending the limitation period for ex-employees of SBI. However, the court emphasized that Section 119(2)(b) requires the authority to consider genuine hardship and condone the delay without the need for specific CBDT instructions.

The undisputed facts revealed that the petitioner opted for voluntary retirement under the Exit Option Scheme of SBI in 2008. After the initial return was processed disallowing the exemption claim, the petitioner filed a revised return in 2013, beyond the limitation period. Despite acknowledging the genuine hardship faced by the petitioner, the Commissioner rejected the application based on the lack of CBDT instructions. The court clarified that the absence of such instructions does not preclude the authority from condoning the delay if genuine hardship is established.

The court noted that similarly situated ex-employees of SBI had been granted condonation of delay in filing revised returns under Section 119(2)(b). The court referred to a specific case where interest was not granted upon condonation of delay, which was deemed applicable in the present case as well. Consequently, the court set aside the impugned order and allowed the condonation of delay in filing the revised return for Assessment Year 2008-09, emphasizing the importance of considering genuine hardship under Section 119(2)(b) without a mandate for specific CBDT instructions.

In conclusion, the court's decision focused on upholding the principles of genuine hardship and the statutory provisions under Section 119(2)(b) of the Income Tax Act, 1961. The judgment clarified that the authority has the discretion to condone delays in filing revised returns without the necessity of specific instructions from the CBDT, especially when genuine hardship is established.

---