2025 (4) TMI 650 - HC - Income Tax

Registration u/s 12A - Dismissal of application for condonation of delay in filing audit report in Form 10B - There was a delay in filing the audit report an application was filed before the Commissioner u/s 119 (2) (b) of the Act for condonation - According to the petitioner the delay in filing the audit report was inadvertent and it was during the Covid-19 Pandemic time - HELD THAT - A perusal of the impugned order reveals that no specific reasons have been given by the Commissioner and instead he merely came to the conclusion that the petitioner had failed to provide any reasons or documentary evidence to prove that the delay was caused due to circumstances beyond petitioner s control. The approach of the Commissioner has been highly hyper-technical and contrary to the well established principles on condonation of delay. The requirement of audit report to be filed one month before filing the returns have been brought in by an amendment only recently. Till then the audit reports could be filed along with the returns. In the instant case the delay in filing the audit report occurred at a time when Covid-19 Pandemic had struck the country. The supreme Court had in Re Cognizance for Extension of Limitation 2021 (11) TMI 387 - SC ORDER suo motu extended the time for filing various applications in judicial and quasi judicial proceedings. Though the respondents have objects to the applicability of the said judgment to the filing of an audit report principles embodied in the said judgment of the Supreme Court could be adopted especially since the delay in filing audit report is only 25 days. Ext.P8 order is set aside and the delay in filing the audit report for the assessment year 2021-2022 is hereby condoned.

Summary

In the case before the Kerala High Court, presided over by Honourable Mr. Justice Bechu Kurian Thomas, the petitioner, a charitable trust registered under Section 12A of the Income Tax Act, 1961, challenged an order dismissing their application for condonation of delay in filing an audit report in Form 10B for the assessment year 2021-2022. The audit report was filed 25 days late, although the tax return was submitted on time.The petitioner argued that the delay was inadvertent and occurred during the Covid-19 Pandemic, a period during which the Supreme Court had condoned delays in many matters. The Commissioner dismissed the application without providing specific reasons, stating that the petitioner failed to prove the delay was beyond their control. The court found the Commissioner's approach to be "highly hyper-technical" and inconsistent with established principles on condonation of delay.Justice Thomas noted that the requirement for the audit report to be filed a month before the returns was a recent amendment and that the Supreme Court had extended deadlines during the pandemic. Given the minimal delay and the confusion caused by date changes, the court concluded that a rigid stance was inappropriate. The court set aside the Commissioner's order, condoned the delay, and allowed the writ petition.