2019 (9) TMI 196 - HC - Income Tax

Condonation of delay - Revision u/s 264 - condonation of delay under section 119 - CIT, Bengaluru dismissed the petitioner s petition on the ground that Assessment order cannot be revised as there is no provision in the Income Tax Act to condone the delay in making any investment in specified bonds as per the provisions of Section 54(EC) - Whether communication dated 13.12.2017 (Annexure F ) is in terms of Section 119(2)(b) read with Circular dated 09.06.2015 or not? - HELD THAT - Petitioner has not questioned the validity of the Circular which relates to pending application as on 09.06.2015. Petitioner had submitted application on 24.05.2011 before the CBDT and it was pending consideration as on 09.06.2015, the date on which the circular was issued. As long as petitioner has not questioned the validity of para.8 of the circular, petitioner is not entitled for relief sought in the present petition. That apart, conduct of the petitioner is required to be taken into consideration for the purpose of deciding whether petitioner is entitled for the relief in the present petition or not? On 24.08.2005, assessment order was passed. Feeling aggrieved and dis-satisfied in respect of portion of the order, petitioner had filed an application under Section 264 and it was rejected on 21.07.2006. Thus, petitioner had a cause of action with reference to AY 2003-04 on or before 31.03.2010 which is the outer limit in terms of the circular dated 09.06.2015. Petitioner has slept over the matter from 21.07.2006 to 24.05.2011 for which petitioner has not appraised this Court by adducing any documentary evidence so as to examine whether delay could be condoned or not. Even for condoning the delay, para.8 of the circular would be a hurdle which is not questioned by the petitioner. The cited decisions has no assistance to the petitioner having regard to the factual aspect of the present matter. Petitioner has not explained the inordinate delay and laches from 21.07.2006 to 24.05.2011.

Summary

Issues:
1. Petitioner seeking relief through writ petitions to quash orders related to income tax assessment and condone delays in investment.
2. Interpretation of delay in reinvestment for exemption of capital gains tax.
3. Rejection of petitioner's application by CBDT based on circular dated 09.06.2015.
4. Applicability of judicial decisions cited by petitioner in the current case.

Issue 1: Relief sought through writ petitions
The petitioner, an income tax assessee, filed assessment returns for the year 2002-03 and reinvested the capital gain amount two days after the due date. Dissatisfied with the assessment, the petitioner filed a revision under Section 264 of the Income Tax Act, which was dismissed by the Commissioner. Subsequently, the petitioner approached the CBDT seeking condonation of delay, which was rejected based on a circular issued in 2015. The petitioner then filed a writ petition challenging the rejection.

Issue 2: Interpretation of delay in reinvestment
The petitioner argued that the delay in reinvestment should be interpreted differently, contending that there was no delay if calculated from a different date. The petitioner sought relief based on the interpretation of the delay and claimed entitlement to exemption from payment of capital gains tax.

Issue 3: Rejection based on circular dated 09.06.2015
The CBDT rejected the petitioner's application citing a circular issued in 2015, which set a time limit for entertaining condonation applications. The petitioner's application, submitted in 2011, was considered beyond the specified time frame. The respondent contended that the circular applied to the petitioner's case and that the petitioner cannot challenge its validity after the fact.

Issue 4: Applicability of judicial decisions
The petitioner relied on three judicial decisions to support their claim for condonation of delay. However, the court found that the cited decisions did not directly apply to the petitioner's case, as they involved different circumstances and timelines. The court emphasized the need to consider the specific facts of the current case and dismissed the writ petition due to the petitioner's failure to explain the delay adequately.

In conclusion, the High Court of Karnataka dismissed the writ petition filed by the petitioner seeking relief in income tax assessment matters. The court upheld the rejection of the petitioner's application by the CBDT based on a circular issued in 2015, emphasizing the importance of timely submissions and adherence to specified time limits. The court also highlighted the need to consider the factual background of each case while determining the applicability of judicial decisions cited by the parties.