Petitioner wins delay condonation case for ITR filing citing COVID-19 quarantine hardship circumstances

Gauhati HC allowed writ petition regarding condonation of delay in filing ITR. Petitioner sought delay condonation citing COVID-19 quarantine and related hardship. Court held that subordinate authority incorrectly rejected application instead of referring to CBDT, which has statutory power for delay condonation. Following Telangana HC and Orissa HC precedents, court found petitioner's medical hardship during pandemic was beyond control and required proper consideration. HC directed CIT to place petitioner's records before CBDT for appropriate decision on delay condonation based on hardship grounds.

---

---

Issues:
1. Rejection of option under Section 115BAA by Income Tax authorities.
2. Request for rectification and reprocessing of Income Tax Return.
3. Condonation of delay in filing ITR for Assessment Year 2020-21.
4. Interpretation of Section 119 (2) (b) of the Income Tax Act, 1961.

Analysis:
1. The petitioner, a private limited company, opted for the reduced corporate tax scheme under Section 115BAA by filing Form 10-IC for the assessment year 2020-21. However, the Income Tax authorities rejected the option, leading to a tax demand of Rs. 15,68,780/- along with interests, citing a notice dated 13.11.2022. The petitioner sought rectification, but an order under Section 154 was issued, raising additional tax and rejecting the Form 10-IC.

2. The petitioner requested rectification due to mistakes in the notice received on 13.11.2022, but the respondent issued an order under Section 154, rejecting the Form 10-IC. The petitioner cited a circular allowing condonation of delay under Section 119 (2) (b) due to the COVID-19 pandemic, which caused the delay in filing the returns. The petitioner approached the Court seeking relief under Section 119(2) for condoning the delay.

3. The petitioner argued that the delay in filing the ITR was due to genuine hardship caused by a medical issue during the COVID-19 pandemic. Referring to judgments from other High Courts, the petitioner requested the CBDT to consider the case liberally under Section 119(2) and condone the delay of 16 days in filing the ITR for the assessment year 2020-21.

4. The Court analyzed Section 119 (2) (b) and referred to judgments from Telangana and Orissa High Courts, which allowed petitions for condonation of delay. The Court emphasized that the power to condone delay lies with the CBDT and not subordinate authorities. It concluded that the hardship faced by the petitioner should be considered, directing the CBDT to review the case and make a decision within 60 days.

This detailed analysis of the judgment highlights the issues of rejection of the tax scheme option, rectification request, condonation of delay, and the interpretation of Section 119 (2) (b) under the Income Tax Act, 1961. The Court's decision to direct the CBDT to consider the petitioner's case for condonation of delay due to genuine hardship provides clarity on the legal principles involved in the matter.

---