Court upholds CBDT decision rejecting Co-operative Bank's application for condonation of delay in filing tax return.

The Court upheld the CBDT's decision to reject the Co-operative Bank's application for condonation of delay in filing income tax return for assessment year 2008-09. The Court found the petitioner failed to justify the delay and discrepancies in filing the application within the prescribed time limit. Due to the impracticality of reopening assessments for a distant past period, the Court concluded that no interference was warranted, and the petition was disposed of accordingly.

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Issues:
Challenge to CBDT order rejecting condonation of delay in filing income tax return for assessment year 2008-09.

Analysis:
The petitioner, a Co-operative Bank, filed the income tax return for assessment year 2008-09 on 18.12.2008, claiming a carry forward of losses amounting to Rs. 24.65 Lakhs. However, the Assessing Officer rejected the claim as the return was filed after the due date of 31.10.2008. The CIT(A) allowed the appeal, but the Tribunal overturned this decision, stating that the proper course for the petitioner would have been to seek condonation of delay from the CBDT.

The petitioner approached the CBDT seeking condonation of delay in filing the return under Section 119(2) of the Income Tax Act. There was a dispute regarding the date of filing the application, with the petitioner claiming it was filed on 6.10.2014, while the CBDT entertained an application received on 23.10.2015. The CBDT dismissed the application on 13.9.2017, citing unsatisfactory explanation for the delay and filing beyond the permissible limit of six years as per a CBDT Circular.

The petitioner argued that the CBDT erred in rejecting the application, explaining that delays were due to the audit process that started in July 2010 and concluded with the filing of the return on 18.12.2008. The petitioner cited legal precedents to support their case. The Department opposed the petition, asserting that the CBDT had valid reasons for rejecting the application due to unexplained delays.

After hearing both parties and reviewing the records, the Court noted that apart from the delay in filing the return, the petitioner failed to justify why the application for condonation of delay was not filed within six years. The Tribunal's judgment in 2014 emphasized the necessity of filing such an application once the opinion was expressed. The Court found discrepancies in the petitioner's claims of filing applications and evidence presented to the CBDT, leading to doubts about the diligence in pursuing remedies within the prescribed time limit.

Given the need for a proper assessment to recognize genuine losses for carry forward, reopening the assessment for the distant past period was deemed impractical. The Court concluded that no interference was warranted, and the petition was disposed of accordingly.

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