2021 (1) TMI 689 - HC - Income Tax

Extension of due date of filing the Tax Audit Report and Income Tax Return for the assessment year 2021-21 both for tax audit assessee and for non-tax audit assessee for a reasonable time atleast till March 31 2021 - COVID- 19 pandemic - HELD THAT - Admittedly the country continues to suffer and to reel under the COVID-19 pandemic. A large number of assesses still find it difficult to even meet their Chartered Accountants and to file their Income Tax Audit Reports and the Income Tax Returns. Therefore this Court permits the petitioner to submit a fresh representation voicing all their grievances with regard to the consequences which would flow from different provisions of the Act. The CBDT is directed to leniently consider the said representation after giving an opportunity of hearing to the petitioner and to pass a reasoned order thereupon.

Summary

Issues:
Extension of due date for filing Tax Audit Report and Income Tax Return for assessment year 2020-21 due to COVID-19 pandemic.

Analysis:
The Dehradun Chartered Accountants Society filed a Public Interest Litigation (PIL) seeking a writ to extend the due date for filing Tax Audit Report and Income Tax Return for the assessment year 2020-21 until at least March 31, 2021. The petitioner's counsel argued that due to the COVID-19 pandemic, income tax assessees faced challenges in meeting the specified filing dates set by the Government. Despite representations made by various Chartered Accountants Societies, the Government had not extended the filing deadline beyond 10.01.2021 for non-tax assesses, 15.01.2021 for Tax Audit Reports, and 15.02.2021 for Income Tax Returns.

The respondent's counsel referred to a similar case in the Hon'ble High Court of Gujarat where the issue of extending the filing date was dismissed. In response, the petitioner's counsel highlighted that the Gujarat High Court had directed the Central Board of Direct Taxes (CBDT) to consider issuing a lenient circular regarding late filing consequences under Section 271B of the Income Tax Act. The petitioner sought a similar order for considering other provisions with consequences for late filing and requested to submit a fresh representation to the CBDT.

Considering the ongoing COVID-19 situation and the difficulties faced by assesses in filing their reports and returns, the court allowed the petitioner to submit a fresh representation outlining all grievances related to various provisions of the Income Tax Act. The CBDT was directed to consider the representation leniently after providing an opportunity for a hearing to the petitioner and to issue a reasoned order accordingly. The court disposed of the petition with these directions, emphasizing the need for a compassionate approach towards the challenges posed by the pandemic on income tax filers.

In conclusion, the court's decision to permit a fresh representation and direct the CBDT to consider the grievances of the petitioner in light of the various provisions of the Income Tax Act demonstrates a balanced approach to address the hardships faced by income tax assessees during the COVID-19 pandemic. The judgment underscores the importance of flexibility and understanding in dealing with the practical difficulties encountered by taxpayers in meeting statutory deadlines amidst exceptional circumstances.