TaxTMI 
TaxTMI 
TaxTMI 
2025 (9) TMI 955
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....of income for the Assessment Year 2023-24 is rejected. 3 The brief facts which has led to filing of the present writ petition are as under: 3.1 The petitioner is a Hindu Undivided Family and its Karta is engaged in the business of trading in shares and currency and also earns income from interest. 3.2 It is the case of the petitioner that during the Assessment Year 2023-24, the petitioner incurred loss of Rs. 1,16,31,999/-. Books of accounts for the year were duly audited on 29.09.2023 i.e. before the due date of 30.09.2023. The Tax Audit Report under Sec. 44AB of the Act was also obtained on the same date. The Tax Audit Report along with the balance- sheet and profit and loss account were uploaded on Income Tax portal on 29.9.2023. However, owing to circumstances beyond its control, the petitioner could not file the return of income for the Assessment Year 2023-24 before the prescribed due date i.e. 31.10.2023. Therefore, an application under Sec. 119(2)(b) of the Act was preferred by the petitioner whereby the respondent was requested to condone the delay in filing the return of income. The said application was preferred on 15.12.2023 to file the return of income which i....
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....10.2022 as per the provision of the Act. Ignorance of law cannot be a ground to claim the benefit of the Act so his losses can be setoff. Therefore, according to learned Senior Standing Counsel Mr. Karan Sanghani, the petitioner is not entitled to any benefit of setoff of losses after filing of the Income-tax returns for the Assessment Year 2023- 24. 6 Having heard the learned advocates for the respective parties and considering the facts of the case, it is not in dispute that the Chartered-Accountant of the petitioner was pre-occupied with his family function which resulted into non filing of the Income-tax Return. The Audit Report has been duly certified, the losses of the petitioner are not doubted. As soon as the function was over in the family of the Chartered-Accountant and the petitioner was made aware about non filing of the Income-tax Return on time, an application was made straightaway on 15.12.2022 under Sec. 119(2)(b) of the Act. Therefore, the respondent authority could not have rejected the application as filing of return for claiming benefit under the provision of the Act is procedural and the benefit accrued to the assessee cannot be taken away on account of tech....
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....lth Pvt. Ltd. v. Additional Commissioner of Income Tax (HQ), Pune & Ors. (Writ Petition No.15544 of 2023 dtd. 19th December 2023) in paragraphs No. 9 and 10 held as under: 9. While considering the genuine hardship, the PCCIT was not expected to consider a solitary ground as to whether the assessee was prevented by any substantial cause from filing the corrections within a due time. Other factors also ought to have been taken into account. The phrase "genuine hardship" used in Section 119(2)(b) of the Act should have been construed liberally. The Legislature has conferred the power to condone the delay to enable the authorities to do substantial justice to the parties by disposing the matters on merits. The expression 'genuine' has received a liberal meaning in view of the law laid down by the Apex Court and while considering this aspect, the authorities are expected to bear in mind that ordinarily the applicant, applying for condonation of delay, does not stand to benefit by lodging erroneous returns. Refusing to condone the delay can result in a meritorious matter being thrown out at the very threshold and cause of justice being defeated. As against this, when del....
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....lief was not satisfactorily explained, more particularly when the returns could not be filed in time due to the ill health of the officer who was looking after the taxation matters of the petitioner...." (p. 737). The Madras High Court in the case of R. Seshammal (P.) Ltd. (supra), was pleased to observe as under: "This is hardly the manner in which the State is expected to deal with the citizens, who in their anxiety to comply with all the requirements of the Act pay monies as advance tax to the State, even though the monies were not actually required to be paid by them and thereafter, seek refund of the monies so paid by mistake after the proceedings under the Act are dropped by the authorities concerned. The State is not entitled to plead the hyper technical plea of limitation in such a situation to avoid return of the amounts. Section 119 of the Act vests ample power in the Board to render justice in such a situation. The Board has acted arbitrarily in rejecting the petitioner's request for refund." (p.187) 15. The phrase "genuine hardship" used in section 119(2)(b) should have been construed liberally even when the petitioner has complied with al....
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.... be arrived at on that evidence. 17. Having said so, turning to the facts of the matter giving rise to the present petition, we are satisfied that respondent No. 1 did not consider the prayer for condonation of delay in its proper perspective. As such, it needs consideration afresh." 10. This was followed by this Court in Artist Tree (P.) Ltd. v. Central Board of Direct Taxes, (2014) 52 taxmann.com 152 (Bombay) relied upon by Mr. Walve, where paragraph nos. 19, 21 and 23 read as under : "19. The circumstance that the accounts were duly audited way back on 14 September 1997, is not a circumstance that can be held against the petitioner. This circumstance, on the contrary adds force to the explanation furnished by the petitioner that the delay in filing of returns was only on account of misplacement or the TDS Certificates, which the petitioner was advised, has to be necessarily filed along with the Return of Income in view of the provisions contained in Section 139 of the said Act read along with Income Tax Rules, 1962 and in particular the report in the prescribed Forms of Return of Income then in vogue which required an assessee to attach the TDS Certifi....
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....r 1997-98 is liable to be set aside. Consistent with the provisions of Section 119(2)(b) of the said Act, the concerned I.T.O. or the Assessing Officer would have to consider the Return of Income and deal with the same on merits and in accordance with law." The Court has held that the phrase 'genuine hardship' used in Section 119(2)(b) of the Act should be considered liberally. CBDT should keep in mind, while considering an application of this nature, that the power to condone the delay has been conferred is to enable the authorities to do substantial justice to the parties by disposing the matters on merits and while considering these aspects, the authorities are expected to bear in mind that no applicant would stand to benefit by lodging delayed returns. The court also held that refusing to condone the delay can result in a meritorious matter being thrown out at the very threshold and cause of justice being defeated. As against this, when the delay is condoned, the highest that can happen is that a cause would be decided on merits after hearing the parties. Similar issue came to be considered in R. K. Madhani Prakash Engineers (Supra), where paragraph 8 reads as ....
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....tionary meaning thereof and the legal conspectus attending thereto. For the said purpose, another well known principle, namely a person cannot take advantage of his own wrong, may also have to be borne in mind. The Gujarat High Court in the case of Gujarat Electric Co. Ltd. V. CIT MANU/G1/0407/2001: 255 ITR 396, was pleased to hold as under: The Board was not justified in rejecting the claim for refund on the ground that a case of genuine hardship was not made out by the petitioner and delay in claiming the relief was not satisfactorily explained, more particularly when the returns could not be filed in time due to the ill health of the officer was looking after the taxation matters of the petitioner. The Madras High Court in the case of Seshammal (R) v. ITO MANU/ TN/ 0879/ 1998: (1999) 237 ITR 185 (Madras), was pleased to observe as under: This is hardly the manner in which the State is expected to deal with the citizens, who in their anxiety to comply with all the requirements of the Act pay monies as advance tax to the State, even though the monies were not actually required to be paid by them and thereafter seek refund of the monies so paid b....
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....it the person applying for refund after condonation of delay has a case which needs consideration and which is not bound to fail by virtue of some apparent defect. At this stage, the authority is not expected to go deep into the niceties of law. While determining whether refund claim is correct and genuine, the relevant consideration is whether on the evidence led, it was possible to arrive at the conclusion in question and not whether that was the only conclusion which could be arrived at on that evidence." (emphasis supplied) This court in R.K. Madhani Prakash Engineers (Supra) had quashed and set aside the impugned order on the ground that the impugned order is not passed by the CBDT but only with the approval of the Member (IT & R), CBDT. So also in the case of TATA Autocomp (supra) wherein paragraphs 11, 12 and 13 read as under: "11. Moreover, the order says, "This issues with the approval of Member (IT&R), Central Board of Direct Taxes" and is signed by one Virender Singh, Additional Commissioner of Income Tax (ITA Cell), CBDT, New Delhi. If a personal hearing has been granted by the Member (IT&R), the order should have been passed by him. Mr. Sharm....