High Court condones late income tax return filing, allows deduction under Section 80IA despite minor delay

The High Court, in a case involving a company filing an income tax return 21 seconds past the deadline for AY 2020-2021, condoned the delay in the interest of substantial justice. The delay led to the disallowance of a deduction under Section 80IA, resulting in a demand. Despite the rejection of the condonation request by the respondent due to a typographical error, the Court considered the minimal delay a human error and set aside the impugned orders, allowing the writ petition without costs.

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Issues involved:
The petitioner challenged the order passed by the Principal Commissioner under Section 119(2)(b) of the Income Tax Act, 1961 and subsequent rejection of representation regarding the delay in filing return of income for assessment year 2020-2021.

Summary:
The petitioner, a company, filed a return of income for AY 2020-2021 with a delay of 21 seconds past the deadline. The delay led to disallowance of deduction under Section 80IA, resulting in a demand. The petitioner sought condonation of the delay, which was initially rejected by the respondent, citing a typographical error in the date. The High Court, considering the minimal delay and the principle of substantial justice, condoned the delay, setting aside the impugned orders and allowing the writ petition without costs.

Details for each issue:
1. The petitioner filed the return of income for AY 2020-2021 with a delay of 21 seconds past the deadline, leading to disallowance of deduction under Section 80IA and a subsequent demand.

2. The respondent rejected the petitioner's request for condonation of the delay, citing a typographical error in the date of filing, which necessitated the petitioner to approach the respondent with a rectification petition, also subsequently dismissed.

3. The High Court noted that while the rejection of the deduction under Section 80IA due to the delay was justified, the quantum of delay being only 21 seconds could be considered a human error and thus condoned in the interest of substantial justice.

4. The Court emphasized that although the software automatically closed the portal at midnight, the request for condonation should have been considered by a human being, who could have viewed the delay in filing the return with leniency.

5. Consequently, the High Court set aside the impugned orders, condoning the delay of 21 seconds and directing that the return for AY 2020-2021 be considered as filed in time, with the petitioner instructed to ensure timely statutory compliances in the future.

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