2025 (2) TMI 295 - HC - Income Tax

Condonation of delay in filing an audit report - client was late by 1 hour 19 minutes and 16 seconds in uploading the audit report - As per revenue reasons mentioned for delay are not sufficient and it was not a fit case for condoning delay in exercise of power u/s 119 (2) (b) HELD THAT - The authority considered reason given by petitioner for the delay to be mere asking on the basis of vague assertion without proof. Required proof therefore is reason for technical glitch causing delay in uploading the report. The delay is of 1 hour 19 minutes and 16 seconds. The report stood uploaded beyond midnight of the last date at 1 19 and 16 seconds in the following morning of 1st November 2023. Where the pressure of meeting the timeline expiring in a few hours or minutes there may have been mistakes made in uploading attributed by petitioner as technical glitch. Even assuming such was the case the report stood uploaded beyond midnight of the last date by 1 hour 19 minutes and 16 seconds. There has to be pragmatic approach in exercising power to enlarge time. Here the time overrun over is a little more than an hour on the report uploaded in the wee hours of the next day 1st November 2023. We cannot imagine the delay would have hampered work of revenue in dealing with the report. It is clear to us that impugned order is perverse. As such we have dealt with the writ petition without granting adjournment.

Summary

In the case before the Orissa High Court, the petitioner, a registered trust exempt from income tax, sought judicial intervention after its application for condonation of delay in filing an audit report was rejected. The delay in uploading the report was 1 hour, 19 minutes, and 16 seconds past the deadline. The authority had denied the application, citing insufficient reasons for the delay and referencing a precedent from the Delhi High Court, which emphasized the importance of adhering to statutory time limits unless compelling reasons are provided.The court, presided over by Acting Chief Justice Arindam Sinha and Justice M.S. Sahoo, found the authority's decision to be "perverse." The court noted that the delay was minimal and unlikely to have disrupted the revenue's operations. The judges emphasized the need for a pragmatic approach in exercising the power to extend deadlines, especially when the delay is marginal and attributed to technical glitches.Consequently, the court set aside and quashed the impugned order, directing that the audit report filed in Form 10B be considered compliant. The writ petition was disposed of, favoring the petitioner.