Technical glitch caused one-day delay in filing income tax return, condonation wrongly rejected under section 119(2)(b)

The Bombay HC allowed a petition challenging rejection of condonation application for one-day delay in filing income tax return under section 119(2)(b). The petitioner's return could not be uploaded due to technical issues. The revenue authority rejected the application reasoning that the return had already been processed under section 143(1) with demand due. The HC held this reasoning was misconceived and showed complete non-application of mind. The court emphasized that processing of return cannot be grounds to reject condonation application for bona fide one-day delay caused by technical issues, applying established jurisprudential principles for condoning delay.

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Issues:
Challenge to Order rejecting condonation of delay in filing income tax return under Article 226 of the Constitution of India.

Analysis:
The Petitioner filed the return with a one-day delay due to a technical glitch, leading to an application for condonation of delay under Section 119 (2) (b) of the Income Tax Act, 1961. However, the Principal Commissioner of Income Tax rejected the application based on the processing of the return under Section 143 (1) of the Act with demand due. The High Court found the reasoning flawed, emphasizing that a minor delay should not be rejected solely based on the processing of the return.

The High Court referred to a previous judgment where a similar delay was condoned, highlighting the importance of considering genuine human problems that may prevent timely compliance. The Court stressed the need for sensitivity and flexibility in such cases, especially when professional services are involved. The judgment emphasized the significance of recognizing valid reasons for delays and the need to remove prejudice caused by rigid application of rules.

Another case cited involved a two-day delay in filing a return, which was also ordered to be condoned. The Court reiterated the principles discussed in the previous judgment, emphasizing the necessity to allow for condonation of delays caused by genuine reasons. The High Court concluded that in the interest of justice, the Petition should be allowed, directing the Respondents to modify the intimation under Section 143 (1) of the Act to grant the requested deduction and refund.

The Petition was disposed of without costs, with the Court issuing appropriate writs to quash the order rejecting condonation of delay and directing the necessary modifications to the intimation under the Income Tax Act.

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