High Court grants delay condonation, orders Income Tax refund despite acknowledgment delay

The High Court allowed the petitioner's application for condonation of delay under Section 119(2)(b) of the Income Tax Act, directing the Income Tax Department to process the refund claim of Rs. 43,590 for Assessment Year 2015-16 despite the delay in sending the acknowledgment. The Court emphasized the petitioner's genuine hardship due to his wife's critical illness and hospitalization, quashing the Principal Commissioner's order and instructing the Department to issue the refund within three months from the Court's order.

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Issues:
Delay in filing income tax return under Section 139(4) of the Income Tax Act, 1961 and condonation of delay under Section 119(2)(b) for Assessment Year 2015-16.

Analysis:

The petitioner, a practicing advocate, filed a writ petition aggrieved by the order of the Principal Commissioner, Income Tax, Indore, dated 15.03.2019, regarding the delay in filing the income tax return for the Assessment Year 2015-16. The petitioner contended that despite a delay of 86 days in filing the return, he was entitled to a refund of Rs. 43,590 as per his income computation. The return was filed electronically within the statutory period under Section 139(4) of the Income Tax Act, 1961, but the acknowledgment was sent to the CPC, Banglore after a delay of 335 days due to his wife's critical illness.

The petitioner invoked Section 119(2)(b) of the Income Tax Act, 1961, seeking condonation of the delay caused in sending the acknowledgment to CPC, Banglore. The petitioner, aged 76 years, highlighted his wife's illness and the TDS deduction of Rs. 43,586 from his salary income. He relied on a CBDT circular allowing condonation where the claim amount is less than Rs. 10,00,000 for any Assessment Year. However, the Principal Commissioner rejected the condonation request on the grounds of lack of reasonable cause for the delay.

The High Court analyzed the facts, noting that the petitioner filed the return as per Section 139(4) and sent the acknowledgment late due to his wife's critical illness. The Court emphasized the genuine hardship faced by the petitioner, as he diligently filed the return but failed to send Form No.V within the prescribed time. The Court referred to the CBDT circular providing discretion to condone delays in genuine cases, considering the circumstances of the petitioner's wife's illness and hospitalization.

Consequently, the High Court quashed the order of the Principal Commissioner and allowed the petitioner's application for condonation of delay under Section 119(2)(b). The Court directed the Income Tax Department to process the petitioner's refund claim of Rs. 43,590 for Assessment Year 2015-16, disregarding the delay. The Department was instructed to conclude the processing and issue the refund within three months from the date of the Court's order, thereby allowing the writ petition in favor of the petitioner.

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