2023 (4) TMI 955 - HC - Income Tax

Condonation of delay in filing income tax return u/s 119(2)(b) for the assessment year 2021-2022 - As stated that because of COVID-19 pandemic, financial condition of the petitioner was severely affected because of which it could not file the income tax return within the due date - HELD THAT - We are of the view that it is a case of genuine hardship on the part of the petitioner which prevented it from filing the return and the related form within the due date. Besides, the delay is of only about fifteen days time. That being the position, we feel that present is a fit case where CBDT may exercise its discretion under clause (b) of sub-section (2) of Section 119 of the Act and do the needful. Accordingly, we direct respondent No.3 CBDT, to consider the grievance of the petitioner and thereafter pass appropriate order under Section 119(2)(b) of the Act regarding condonation of delay in filing the return of income for the assessment year 2021-2022 along with Form 10-IC of the Act. Let the above exercise be carried out within a period of two months from the date of receipt of a copy of this order.

Summary

Issues involved:
The issues involved in the judgment are the delay in filing the return of income for the assessment year 2021-2022 and the consideration of the concessional rate of tax claimed by the petitioner.

Delay in Filing Return of Income:
The petitioner, a company engaged in construction activities, sought a direction to condone the delay in filing the income tax return for the assessment year 2021-2022 due to the adverse financial impact of the COVID-19 pandemic. Despite the due date being 15.03.2022, the petitioner filed the return on 31.03.2022 under Section 139(4) of the Income Tax Act, 1961. The respondent processed the return under Section 143(1) and issued an intimation demanding a higher tax amount than what was paid by the petitioner. The petitioner contended that the respondent did not consider the Form 10-IC application filed belatedly along with the return, leading to the discrepancy in the tax amount demanded.

Concessional Rate of Tax Claim:
The respondent rejected the petitioner's request for condonation of the delay in filing the return, citing the absence of a circular from the Central Board of Direct Taxes (CBDT) granting authority to condone the delay for the assessment year 2021-2022. The respondent relied on Section 119(2)(b) of the Act, which allows for the consideration of genuine hardship cases for condonation of delay in filing returns. The Court acknowledged the genuine hardship faced by the petitioner due to the pandemic and the short delay of about fifteen days in filing the return. Consequently, the Court directed the CBDT to review the petitioner's grievance and make a decision regarding the condonation of the delay in filing the return along with Form 10-IC within two months from the date of the order.

This judgment highlights the importance of considering genuine hardships faced by taxpayers and the discretionary power of the CBDT to address such cases under the provisions of the Income Tax Act, 1961.