2018 (7) TMI 1175 - HC - Income Tax

Benefit of exemption under Section 10(10C) - assessee as retirees of the ICICI Bank under Early Retirement Option Scheme, 2003 as filed a revised return well beyond the period stipulated under Section 139(5) - Held that - All the contentions which were advanced by the second respondent in the counter affidavit have been dealt with by this Court and thereafter, the writ petition has been allowed. I find that there is absolutely no ground made out by the respondents to distinguish the decision rendered in the case of S. SEVUGAN CHETTIAR 2016 (12) TMI 415 - MADRAS HIGH COURT wherein held default in complying with the requirement was due to circumstances beyond the control of the assessee, the Board is entitled to exercise its power and relax the requirement contained in Chapter IV or Chapter VI-A - as held the petitioner, being a senior citizen, cannot be denied of the benefit of exemption under Section 10(10C) of the Act and the financial benefit that had accrued to the petitioner, which would be more than a lakh of rupees. Therefore, this Court is of the view that the third respondent should grant the benefit of exemption to the petitioner. The writ petition is partly allowed and the impugned order is set side and the second respondent is directed to grant the benefit of exemption under Section 10(10C) of the Income Tax Act, 1961, and refund the appropriate amount to the petitioner, within a period of eight weeks from the date of receipt of a copy of this order. This time limit is fixed on the ground that the petitioner is aged 61 years and has a rare cardiac problem and a pacemaker is installed in his heart. No costs.

Summary

Issues:
Petitioner seeking writ of certiorarified mandamus to quash order and refund dues with interest - Respondents contending for filing revised return and condonation petition under Income Tax Act - Comparison with similar case of S.Sevugan Chettiar - Interpretation of Circular issued by Central Board of Direct Taxes under Section 119 of the Act - Application of Section 139(5) and Section 119(2)(c) for relaxation of requirements - Granting exemption under Section 10(10C) to senior citizen petitioner.

Analysis:
The petitioner filed a writ petition seeking the issuance of a writ of certiorarified mandamus to quash the order passed by the second respondent and refund the dues with interest. The respondents argued that the petitioner should have filed a revised return for the assessment year 2004-05 before 31.03.2006, as per Section 139(5) of the Income Tax Act. They contended that the assessing officer cannot process a belated revised return and the petitioner should have filed a condonation petition before the Principal Chief Commissioner of Income Tax, Chennai, under Section 119(2)(b) of the Act. The respondents also emphasized the correct procedure for claiming a refund under the Income Tax Act. The Court noted that a similar issue was considered in the case of S.Sevugan Chettiar and emphasized that technicalities should not hinder the implementation of orders. The Court referred to a Circular issued by the Central Board of Direct Taxes under Section 119 of the Act, which allows for relaxation of provisions. It was highlighted that the Board extended benefits to similarly placed individuals based on a Supreme Court judgment, demonstrating the need to consider genuine hardships. The Court interpreted Section 119(2)(c) which empowers the Board to relax requirements in cases of genuine hardship beyond the assessee's control. In this context, the Court emphasized that the petitioner, being a senior citizen, should not be denied the benefit of exemption under Section 10(10C) of the Act. Consequently, the Court partly allowed the writ petition, setting aside the impugned order and directing the second respondent to grant the exemption and refund the appropriate amount to the petitioner within a specified timeframe due to the petitioner's health condition.

This judgment highlights the importance of considering genuine hardships and the power of authorities to relax requirements under the Income Tax Act. It underscores the need to interpret provisions in a manner that upholds justice and prevents undue hardship to individuals, especially senior citizens. The comparison with a similar case and the reliance on Circulars issued by the Central Board of Direct Taxes demonstrate the significance of consistent application of legal principles and the duty of the Court to ensure fair treatment under the law. The judgment serves as a precedent for granting exemptions and refunds in cases where technicalities should not impede the rightful benefits of individuals, emphasizing the principles of equity and justice in tax matters.