Condonation of delay must be decided on sufficient cause alone, not the merits of the underlying tax claim.

An application for condonation of delay under section 119(2)(b) of the Income-tax Act must be decided only on whether sufficient reason or genuine hardship exists for delay; the merits of the underlying claim are irrelevant at that stage. The impugned rejection orders were set aside because the authority had examined the merits of the petitioner's revised return claim instead of confining itself to the statutory test for delay. The applications were restored for fresh consideration limited to condonation of delay, and the matter was remitted for decision on that restricted basis.

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Issues: Whether the rejection of the applications for condonation of delay under section 119(2)(b) of the Income-tax Act, 1961, was vitiated because the merits of the claim were considered instead of confining the enquiry to the sufficiency of reasons for delay.

Analysis: The impugned orders were found to have been passed after the merits of the petitioner's claim were taken into account. The scope of section 119(2)(b) was treated as confined to examining whether sufficient reason or genuine hardship existed for condoning the delay, and not to adjudicating the merits of the underlying claim for revised returns. On that basis, the rejection could not be sustained.

Conclusion: The rejection orders were set aside and the applications were restored for fresh consideration limited to the question of condonation of delay, without examining the merits of the claim.

Final Conclusion: The matter was sent back to the Principal Commissioner for a fresh decision confined to the statutory test governing condonation of delay.

Ratio Decidendi: An application for condonation of delay under section 119(2)(b) of the Income-tax Act, 1961 must be decided only on the sufficiency of the reasons for delay and not on the merits of the underlying claim.

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