TaxTMI 
TaxTMI 
2025 (12) TMI 807
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....ital media planning, social media marketing, mobile app development (android and iOS), website development & inbound marketing. The petitioner did not file its Return of Income (ITR) for the Assessment Years (AY) 2018-19, even after the extended period upto 31.10.2018. The petitioner filed its ITR on 20.09.2021 after a delay of 30 months. Thereafter, the petitioner filed an application vide letter dated 20.09.2021 under Section 119(2)(b) of the Income Tax Act, 1961 (the Act) for condonation of delay in filing the ITR and claim of carry forward of business loss to the tune of Rs. 1,06,60,750/-, stating that due to an inter se dispute amongst the directors, the return could not be filed. 3. Pursuant thereto, the petitioner company also sought refund amounting to Rs. 19,73,540/- on account of the TDS deducted during the previous year. The respondent no. 1 sent a letter inter alia asking the petitioner to furnish more documents, and thereafter, the respondent no. 1 sought certain information and documents from the petitioner company. On 17.09.2022, the petitioner company via email furnished the documents as required by the respondent no. 1 viz. the complete draft returns of income; ....
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....on from the petitioner regarding differences in the refund amount. The petitioner adverted to this letter vide an email dated 13.12.2022. He submitted that the respondent no. 1 had directed the petitioner to present its case on 16.11.2023, and file written submissions/documents in support of its claim under 119(2)(b) of the Act. The petitioner submitted its detailed submissions/ documents and also explained the details of the dispute which had occurred between the directors of the petitioner company. 7. He submitted that the dispute had occurred between the Directors namely- i. Mr. CVVS Krishna, ii. Mrs. Chandaluri Lakshmi Rani, iii. Mr. Gaurav Dalal & iv. Mr. Anuj Juneja and these persons were also the Directors of the holding company of M/s. Apptology Technology Pvt. Ltd. He stated the main reason for the dispute was a difference of opinion between the then directors i.e. Ms. Gaurav Dalal and Mr. Anuj Juneja, in running the operations of the two companies. He further stated that in the third quarter of financial year (FY) 2017-18, the disagreement between the Directors increased and this infighting amongst them led to the resignation of some Directors in the petitioner company....
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....sons stated by the petitioner and in a manner contrary to the precedents set by various courts. He reiterated that this would result in the petitioner suffering irreparable loss as on one hand, the petitioner company would be deprived from getting the benefit of section 72 of Act and on the other hand, the benefit of TDS deductions to the tune of Rs. 19,73,540/- for the relevant previous year i.e. 2017-18 will go unclaimed if the delay is not condoned. 13. It is his submission that the delay occurred is not deliberate or willing. He stated that the petitioner had furnished the details before the respondents with respect to both-genuine hardship and correctness and hence, the authorities should have condoned the delay. He further stated that the circular number 9/2015 dated 09.06.2015 issued by the respondents instructs the authorities to exercise their powers under Section 119 of the Act. The legislature has conferred power on the authority to condone the delay and construe the term "genuine hardship" liberally to do substantive justice to the parties. The refusal of condonation by the respondents at the very threshold has defeated the cause of justice. 14. Mr. Kumar has plac....
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.... principle of unjust enrichment to state that it would be unjust to allow one person to retain a benefit at the expense of another. To substantiate this argument, he placed reliance on the judgment in the case of Mafatlal Industries Ltd. v. Union of India [I997] 5 SCC 536 wherein, the Court held that once unjust enrichment is proved, restitution to status quo ante must prevail and the person must be given back that benefit. 16. Reliance has also been placed by Mr. Kumar on the judgment in the case of VRG Electronics Pvt. Ltd. v. Principal Commissioner of Income Tax (Delhi) 7 WP(C) 753/2025 wherein, this Court has held as under: "23. We may also refer to the judgment of the Madras High Court in the case of Seshammal (R) v. ITO, (1999) 237 185 (Madras) wherein it held as under: "7. 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....
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.....2018 which was further extended up to 15.10.2018. It was further extended up to 31.10.2018 and evidently, the petitioner had sufficient time to file his return of income within the due date or in the extended period of time but the petitioner failed to do so. 21. He stated internal dispute among the directors of a company is not genuine hardship as a company has a separate identity, is a separate entity of its own different from its directors. He stated that the company, in order to take the benefits provided under the Act, has to comply with the statutory provisions therein. It is his submission that engaging a CA for filing the ITR is not something that is affected by dispute amongst the Directors. 22. He submitted that the original ITR for AY 2017-18 was filed by the petitioner under Section 139(4) on 07.11.2017, revised under Section 139(5) on 25.07.2018, whereas the date of filing of return under Section 139(1) was 31.07.2017. Similarly, for the AY 2019-20, the petitioner filed the ITR under 139(4) on 30.07.2020, return under Section 139(1) on 31.08.2019. This, he stated showed the casual approach of the petitioner in following the statutory obligations. 23. It is hi....
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....all stand dismissed." 26. He further submitted that the reliance of the petitioner on the decision in the case of K.C Antony v. Principal Commissioner of Income Tax & Anr. [2022 SCC OnLineKer 5830] is misplaced as the Court in this case was dealing in the facts wherein the application of the assessee was rejected on the ground of delay in filing the application under Section 119(2)(b) of the Act in view of the CBDT Circular and the Court held that Section 119(2)(b) of the Act does not impose any limitation for the purposes of filing an application for condonation of delay. He stated that this judgment would not be applicable to the facts of the present case wherein, the application of the assessee has been rightly rejected due to lack of evidence of extraordinary circumstances to justify the existence of genuine hardship which prevented the assessee from filing the ITR on time. 27. Hence, concluding his submissions, Mr. Agrawal stated that the petitioner should have filed the ITR on time for availing the benefits under Section 72, as prescribed by the Act. He stated no plausible reasons were given by the petitioner for its failure to file the ITR and no case of genuine hardsh....
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....e facts are similar to the present case inasmuch as the delay of almost two years in filing the ITR was due to a dispute between the management of the company and its promoters/investors, the same fact was sufficiently proved owing to the ongoing litigations between the two, before the Company Law Board (CLB), Chennai, and pending appeal before the Karnataka High Court, whereby the Karnataka High Court vide its order appointed an Auditor to complete the statutory audit of the assessee's books of accounts and to file the ITR. This proved beyond doubt the genuine hardship of the assessee in the peculiar facts of the case. However, such are not the facts of the present appeal, wherein, no documents/records of any pending litigation have been produced before the department or even before us to show how the dispute between the Directors seriously affected the assessee from filing the ITR even in the extended period of limitation. This judgement, even though, it was later upheld by the Supreme Court, the Court observed the following:- "3. Having heard Shri N. Venkatraman, learned Additional Solicitor General and having considered the facts and circumstances due to which the resp....