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TMI Blog2018 (3) TMI 965X X X X Extracts X X X X X X X X Extracts X X X X ..... of time have to be proved and established. Any indulgence on the pretext that the petitioner has been denied benefit under Section 80IB, which on merits would have been allowed, would be contrary to law, if it is held that there was no reasonable ground or reason for extension of time in filing of the return. - Decided against assessee - Writ Petition(Civil) No. 6537/2017 - - - Dated:- 12-3-2018 - MR. SANJIV KHANNA AND MR. CHANDER SHEKHAR JJ. Petitioner Through Ms. Mihira Sood Mr. Prateek Krishan Chadha, Advocates. Respondents Through Mr. Sanjay Kumar Mr. Rahul Chaudhary, Sr. Standing Counsel. SANJIV KHANNA, J. (ORAL ): M/s B.U. Bhandari Nandgude Patil Associates, an association of persons, has filed the present writ petition under Articles 226 and 227 of the Constitution of India impugning the order dated 8th February, 2017 passed by the Central Board of Direct Taxes (CBDT, for short) under Section 119(2)(b) of the Income Tax Act, 1961 (Act, for short). 2. The impugned order passed by the CBDT dismisses application dated 11th May, 2011 (wrongly mentioned in the impugned order as 11th May, 2015) for extension of time for filing of the income tax return f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the present case, we are not examining merits of the order dated 31st October, 2012 passed by the Tribunal denying or rather upholding disallowance of deduction under Section 80IB of the Act. Subject matter of challenge before us is the order passed by the CBDT dated 8th February, 2017 rejecting the petitioner s application for extension of time for filing of the return for the Assessment Year 2006-07 under Section 119(2)(b) of the Act. 9. Learned counsel for the petitioner is correct that the date of the application for extension of time has been incorrectly recorded in the impugned order as 11th May, 2015 as the application for extension of time was dated 11th May, 2011. However, wrong date recorded in the first paragraph of the impugned order dated 8th February, 2017, would not be a good ground and justification to set aside the impugned order, unless date of the application was the reason for rejection. The date of filing of the application is not the reason for rejection. This was inconsequential. Typographical errors are also noticed in other paragraphs. For example, paragraph 2 refers to purported letter dated 29th November, 2006 and hearing held on 5th January, 2007, whe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... audits are completed in time and this being the big Audit assignment, my personal attention was required to complete the same. Query(viii) No. of audits conducted for A.Y.2006-07 and details thereof No Name and Address of the Assessee Due date of Audit Date of completion of Audit Reply: No response received. 4. In the show-cause letter dated 15.11.16, the above response was confronted to the assessee and it was put to him that the above response did not show the existence of a reasonable cause for delay on the part of the auditor. In the reply dated 29.11.16, the assessee has stated that he is not aware of the auditor s response on the issues stated. It was also argued that the assessee has adopted the percentage completion method in recognizing revenue. Project completion method could also have been alternatively adopted by the assessee resulting in postponement of revenue and deferment of the claim u/s 80IB(10). In such an event, the issue of claiming deduction u/s 80IB(10) would have arisen in a subsequent year and would have been allowed. This proposition is also supported ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e is true and correct to the best of my knowledge belief. 13. The auditor it is accepted had failed furnished even a single document or prescription regarding his illness, purportedly for the reason that he had not maintained record or evidence of illness that had occurred 8 to 9 years back. This was notwithstanding that the purported illness would have been serious and prolonged for this was the sole reason and ground for delay of 5 months. Interestingly, as observed above, the petitioner had belatedly filed the application for extension of time on 11th May,2011 more than four years after the return of income was filed. Petitioner was responsible and would have to suffer if evidence had dissipated with efflux of time and due to delay. 14. CBDT after examining the entire aspects, has come to the following finding and conclusion:- 7. In the submission dated 5.1.2007, it is also argued that no steps were taken by the auditor in 2007 as the assessee was given to understand that the claim would be available even if the return filed upto 31.03.2007. However, the assessment order for A.Y. 2006-07 was passed on 26.11.2008 where the claim u/s 80IB(10) was rejected. Even the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is noted that the auditor has mentioned that it was a big audit assignment and it needed his personal attention. Yet such an assignment is the only delayed without any memory of the extraordinary medical exigency which had caused it. It is also noted that the delay in audit is of five months and not a few days and therefore, a general explanation of medical exigency without any details does not explain the justification for long delay. 12. The assessee has also not been able to show that it pursued the matter with any diligence after all the responsibility of filing the return in time is the assessee and he is expected to be even more diligent if a large claim of deduction is involved. There is nothing to show that the assessee pursued the matter with auditor to get audit done. The fact that all other audit were done timely by the auditor except for this audit also does not help the assessee s case as any medical exigency of the magnitude being claimed would have delayed at least a few more audits. 15. We have considered the said findings recorded by the CBDT, which are primarily factual and also lucid and cogent. Deduction under Section 80IB was not examined and consider ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ner cannot take benefit and advantage of the delay and failure. (vii) CBDT has refused to grant extension of time for filing of return in view of the vague assertions, absence of details and adequate proof. (viii) Delay of 5 months was substantial. 17. Statutory time limits fixed have to be adhered to as it ensures timely completion of assessments. Discipline on time limits regarding filing of returns have to be complied and respected, unless compelling and good reasons are shown and established for grant of extension of time. Extension of time cannot be claimed as a vested right on mere asking and on the basis of vague assertions without proof. Statutory audits it is a common knowledge are not undertaken by one person but by a team consisting of auditor(s), article clerks and others. 18. In the present case, we do not know the nature of illness or medical emergency suffered by the auditor and how long the auditor was incapacitated and could not work. The assertions made to justify extension of time have to be proved and established. Any indulgence on the pretext that the petitioner has been denied benefit under Section 80IB, which on merits would have been allowed, wou ..... X X X X Extracts X X X X X X X X Extracts X X X X
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