TaxTMI 
TaxTMI 
2026 (9) TMI 1889
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....na have challenged the order dated 19.01.2022, passed by the Principal Commissioner of Income Tax, Panchkula (for short - the 'PCIT'), rejecting the petitioners' prayer for condoning the delay in the filing of revised returns of their income, for the assessment year 2017-18, enabling them, through their revised returns, to seek refund of excess income tax paid by them. (2) For the sake of convenience, facts are being extracted from CWP No.18800 of 2023 - Rajbir Singh Vs. Principal Commissioner of Income Tax, Panchkula and others. (3) In the year 1953, HMT Limited was set up as a Central Public Sector Enterprise under the Ministry of Heavy Industries and Public Enterprises, Government of India. The main objective behind setting up HMT Limited was to produce machine tools required for building an industrial edifice for our country. Keeping in view the afore objective, in the year 1971, HMT Limited established its Tractor Division at Pinjore, Haryana. The petitioner was employed by HMT Limited and posted in its Tractor Division at Pinjore, Haryana. (4) Due to several factors, in the 1990s, the performance of HMT Limited started to decline. Several efforts were made to arrest ....
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....x return, also for the assessment year 2017-18, claiming exemption under Section 10(10C) of the Act and after being assessed, he filed a revised income tax return now seeking therein exemption under Section 10(10B) instead of Section 10(10C) of the Act. The Assessing Officer denied the exemption sought by Prempal. The assessment order passed in Prempal's case was challenged by him through filing of an appeal under Section 246(A) of the Act which was accepted through order dated 30.01.2020 passed by CIT(A), Panchkula. Prempal's appeal was allowed by CIT(A) primarily relying on a judgment of the Madras High Court in Hindustan Photo Film Workers' Welfare Centre (CITU) Vs. Government of India, New Delhi, (2018) 400 ITR 299 (Madras), against which decision, the Supreme Court had also dismissed the SLP filed by the revenue. (10) Though in Prempal's case, CIT(A) decided in favour of the assessee but in the case of many other employees, who were similarly situated as Prempal and the petitioner, CIT(A), through several orders dated 12.07.2022, 19.07.2022, 30.11.2022, 06.12.2022 and 30.12.2022 decided in the revenue's favour which orders were challenged by those employees before the ITAT.....
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....el for the revenue submitted that the petitioner's case was not covered under the CBDT's circular No.9/2025 dated 09.06.2015 as it was not genuine because the petitioner had voluntarily accepted payments of huge amounts under the VRS; he is not entitled to the benefit of exemption under Section 10(10B) of the Act and that he has rightly been assessed for the grant of exemption under Section 10(10C) of the Act; the petitioner having filed its income tax return claiming therein exemption under Section 10(10C) of the Act without any protest, cannot now be allowed to revise his return simply because in the case of other vigilant employees, some orders have been passed in their favour; there are no reasons forthcoming in the petitioner's application, filed before the PCIT, explaining therein the delay on the petitioner's part in claiming exemption under Section 10(10B) of the Act and that in the absence of any reasons, the PCIT has rightly rejected the petitioner's application for condonation of delay for filing a revised income tax return. (15) Learned counsel for the parties have been heard. ANALYSIS AND CONCLUSION (16) As per Section 237 of the Act, if any person satisfies t....
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....donation of delay in filing returns claiming refund and returns claiming carry forward of loss and set-off thereof under section 119(2)(b) of the Income-tax Act, (the Act) the present Circular is being issued containing comprehensive guidelines on the conditions for condonation and the procedure to be followed for deciding such matters. 2. The Principal Commissioners of Income-tax/Commissioners of Income-tax (Pr.CsIT/CsIT) shall be vested with the powers of acceptance/rejection of such applications/claims if the amount of such claims is not more than Rs.10 lakhs for any one assessment year. The Principal Chief Commissioners of Income-tax/Chief Commissioners of Income-tax (Pr.CCsIT/CCsIT) shall be vested with the powers of acceptance/rejection of such applications/claims if the amount of such claims exceeds Rs.10 lakhs but is not more than Rs. 50 lakhs for any one assessment year. The applications/claims for amount exceeding Rs.50 lakhs shall be considered by the Board. 3. No condonation application for claim of refund/loss shall be entertained beyond six years from the end of the assessment year for which such application/claim is made. This limit of six years sha....
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.... by Government of India opting for scheme of cumulative interest on maturity but has accounted interest earned on mercantile basis and the intermediary bank at the time of maturity has deducted tax at source on the entire amount of interest paid without apportioning the accrued interest/TDS, over various financial years involved, the time limit of six years for making such refund claims will not be applicable. 8. This circular will cover all such applications/claims for condonation of delay under section 119(2xb) which are pending as on the date of issue of the Circular. 9. The Board reserves the power to examine any grievance arising out of an order passed or not passed by the authorities mentioned in para 2 above and issue suitable directions to them for proper implementation of this Circular. However, no review of or appeal against the orders of such authorities would be entertained by the Board." (18) Section 119(2)(b) of the Act empowers the CBDT to issue instructions or orders to authorize income tax authorities referred therein to admit and decide applications for claims for exemptions, deduction or refund made by the assessees after the expiry of the pe....
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....petitioner's claim under Section 10(10B) was correct or genuine. Non-acceptance of an order on merits, coupled with non-filing of an appeal owing to the prescribed monetary limit, are not the reasons on which correctness or genuineness of the petitioner's claim was required to be considered. (21) Even the finding returned by the PCIT on "genuine hardship" is through a single unreasoned sentence - "no case is made out for hardship". The PCIT does not deal with the fact that the petitioner lost his employment on the closure of the Tractor Division; that the refund claimed is substantial and is of fundamental importance to the petitioner's sustenance. Nor does it consider the fact that the appellate authorities had, in a large number of similar cases, taken the view, which view had attained finality, that VRS was a special package on closure of the undertaking offered in lieu of retrenchment attracting thereto applicability of exemption under Section 10(10B) instead of Section 10(10C) of the Act. (22) The impugned order also observes that "no order has been passed by the CIT (A) in the case of the assessee" and treats this as a reason for rejection. Such an observation was i....
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....the Act. The two provisions serve different purposes and call for different inquiries. Section 5 of the Limitation Act, 1963 governs belated appeals and applications. It has a limitation-oriented focus. The court asks whether the applicant was prevented by "sufficient cause" from filing in time and explanation for the delay, day by day, if needed, is central to that inquiry. On the other hand, Section 119(2)(b) is a power of relaxation given to the Board and its delegates. It allows a claim for refund, made after the statutory period, to be admitted and dealt with on merits where this is considered desirable "to avoid genuine hardship". Para 5 of Circular No. 9/2015 dated 09.06.2015, on which the department itself relies, prescribes what the authority must examine. Under para 5(i) it must ensure that (a) the income or loss declared or refund claimed is correct and genuine and (b) the case is one of genuine hardship on merits. Under para 5(ii) it may also direct the jurisdictional Assessing Officer to make inquiries or scrutinise the claim to ascertain its correctness. The controlling questions under Section 119(2)(b) are therefore, the correctness and genuineness ....