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TMI Blog2022 (12) TMI 1019X X X X Extracts X X X X X X X X Extracts X X X X ..... n the phrase genuine hardship . As mentioned above. Technical consideration above cannot come in the way of substantial justice. It is neither an allegation of malafide nor an allegation that the delay has been deliberate. We do not find that the omission to file petitioner s return by the income tax consultant to be an act of negligence. Any person in his situation would have been mentally disturbed. The very fact that not only the petitioner s ITR was not filed in time, there were also 28 others whose return filing was delayed beyond the due date. The authorities should refrain from over analysis which leads to paralysis of justice. We are, therefore, of the view that the impugned order dated 7th May 2021 deserves to be set aside and is hereby set aside. The income tax authority to act accordingly and consider the claim for deduction under Section 80 IB(10) for AY 2011-12 made by the petitioner in accordance with law, as if there was no delay in filing the return. The authorities under the DTVSV Act also to act in accordance with the said findings and amend Form 3 in respect of the amounts to be paid by the petitioner. - WRIT PETITION NO. 4832 OF 2021 - - - Dated:- 23-8- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a submits that the present petition only pertains to the AY 2011-12, wherein the tax consultant was supposed to file the return on or before 30th September, 2011. However, due to the inadvertent delay on his account, the ITR was filed on 30 th September, 2012 after making a delay of 365 days. Learned counsel submits that the books of accounts of the petitioner were audited on 21st September, 2011 i.e., well within the due date. Learned counsel submits that therefore the petitioner firm filed an application dated 11th October, 2019 under Section 119 (2) (b) of the Act seeking condonation of delay in filing of the ITR for AY 2011-12 caused due to the said tax consultant, depriving the petitioner of a deduction of Rs. 2,42,88,917/- causing grave hardship to the said firm. 5. He submits that thereafter the respondent no. 2 vide his letter dated 3rd February, 2021 called upon the petitioner to make submissions as to why the application under Section 119(2)(b) of the Act should be maintained. It is submitted that the petitioner vide its letter dated 17th March, 2021 made it submissions in reply to the aforesaid letter by the CBDT and thereafter, on 7th May, 2021, the CBDT has rejecte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itioner has already been issued Form 3 whereby petitioner is liable to pay 100% of the tax liability without any interest and penalty, the petition deserves to be dismissed. 11. We have heard the submissions made by learned counsel for the parties and with their able assistance perused the papers and proceedings. 12. It is not in dispute that petitioner having been a joint venture partner of Sanghvi Premise Pvt. Ltd. was involved in the housing project named Sanghvi Nakshatra at Nasik. It is also not disputed by the respondents that Sanghvi Premises Pvt. Ltd. has been allowed the deductions under Section 80 IB (10) of the Act for the AYs 2010-11 to 2013-14. Admittedly, the petitioner has also been allowed deduction under Section 80 IB (10) for the said project for the AYs 2010-11, 2012-13 and 2013-14. It is only in respect of the AY 2011-12 that the return of income came to be filed on 30th September, 2012 after a delay of 365 days. For the said assessment year, the petitioner has claimed deduction of Rs. 31,06,990/- under Section 80 IB (10) of the Act which was disallowed by the Assessing Officer under intimation issued under Section 143 (1) of the Act by application of Sect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of other clients of B. S. Mart but he filed the return of income of the applicant for AY 2011-12 afterwards on 30.09.2012 only. iii. As claimed, the application for condonation of delay u/s 119(2)(b) has been filed quite late as the applicant s Chartered Accountants M/s B. S. Mart have never advised about filing the petition u/s 119(2)(b) of the Act and said that the delay in filing of the return will not stand in the way of deduction u/s 80 IB(10) of the Act. In this respect, it is submitted that the applicant would have enjoyed the benefits based on the advice of its Chartered Accountants such as preparation of audit reports, filing of returns of income in time for other assessment years etc. Then, it cannot shift its responsibility cast upon by the law of land to its Chartered Accountant when their advice, as claimed, did not result in its favour. iv. The applicant appears to be well aware of the position of law in respect of the dealing with the petitions for condonation of delay u/s 119(2)(b) as while referring to the judgments of the various Tribunals where it was held that the deduction u/s 80 IB cannot be disallowed merely for the reason that there have been a d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... idering the reasonable cause and genuine hardship. In this respect, it is submitted that :- a. In the case of Mr. Laddulal Sharma in writ petition No. 9350/2019 order dated 14.01.2020 [Hon ble High Court of Madhya Pradesh]-The application of the assessee for condonation of delay u/s 119(2)(b) of the Act, was allowed as the illness and hospitalization of the wife of the assessee, which lead to the delay, was considered a reasonable and genuine cause of delay in filing of return of income and a case of genuine hardship to the assessee. Here the delay caused is directly related to the assessee. But, in the present case, the poor health of the son of the representative CA is held to be the main cause of delay, which is not directly related to the applicant. b. Surendranagar District Co-operative Bank Ltd. (2019) Nikita Gadgil 11 of 25 311 CTR 0091 (Hon ble High Court of Gujrat)- In this case, the assessee had made out a case of genuine hardship for admitting the claim after the expirty of the period specified under the Act. It was further held that if the circumstances leading to the delay in filing of the return were beyond the control of the assessee the delay in filing o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the applicant). ix. The Hon ble High Court of Delhi vide its decision dated 12.03.2018 in case of M/s B. U. Bhandari Nandgude Patil Associates (on application for condonation of delay u/s 119 (2)(b) of the Act and order passed by the CBDT on 08.02.2017) has dwelled upon reasonable cause . The Hon ble Court has regarded the findings of the CBDT with respect to reasonable cause, genuine hardship diligence as lucid and cogent and has affirmed the following w.r.t. reasonable cause:- 10. In determining whether genuine hardship is caused to the assessee one has to see whether the delay in filing of return was due to a reasonable cause or not. In this case, delay is attributed ti(sic to) the Auditor. However, in such a case on has to see whether the Auditor had a reasonable for cause for delay and whether the assessee pursued the matter due to diligence to get his audit done in time. 11. On the question whether the auditor had a reasonable cause or not, the fact do not show any medical exigency of the kind which would cause so much delay when a statutory deduction of such a large amount was at stake. The auditor has not even been able to mention the nature of illness. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rn of Income for A. Y. 2012-12 is rejected. 14. It is observed from the aforequoted decision that the CBDT has rejected the explanation with respect to the delay caused due to the health condition of the son of the income tax consultant of the petitioner. The income tax consultant has on page 80 to 81 of the petition sworn or an affidavit the reasons due to which the return of the petitioner for the year remained to be filed by 30 th September, 2011 and was filed only on 30th September, 2012. The said reasons of the paragraphs 3 and 4 are quoted as under:- 3) That for the reasons mentioned here below besides due to oversight the said Return remained to be filed and finally it is filed on 30.09.2012. My son, Master Rushikesh, aged 15 years is unfortunately born handicapped and requires constant attention on some of the serious occasions that develop periodically. I state on oath that right from first week of October 2010 his health deteriorated and that remained great concern form me and my other family members. Since there was no satisfactory response, I and my wife had quite a bad time in concentrating on his day to day behaviour. We were laboring under severe mental ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in Section 119(2)(b) should have been construed liberally even when the petitioner has complied with all the conditions mentioned in Circular dated 12th October, 1993. The Legislature has conferred the power to condone delay to enable the authorities to do substantive justice to the parties by disposing of the matters on merit. The expression genuine has received a liberal meaning in view of the law laid down by the Apex Court referred to hereinabove and while considering this aspect, the authorities are expected to bear in mind that ordinarily the applicant, applying for condonation of delay does not stand to benefit by lodging its claim late. Refusing to condone delay can result in a meritorious matter being thrown out at the very threshold and cause of justice being defeated. As against this, when delay is condoned the highest that can happen is that a cause would be decided on merits after hearing the parties. When substantial justice and technical considerations are pitted against each other, cause of substantial justice deserves to be preferred for the other side cannot claim to have vested right in injustice being done because of a non-deliberate delay. There is no presump ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rdinarily a litigant does not stand to benefit by lodging an appeal late. 2. Refusing to condone delay can result in a meritorious matter being thrown out at the very threshold and cause of justice being defeated. As against this when delay is condoned the highest that can happen is that a cause would be decided on merits after hearing the parties. 3. 'Every day's delay must be explained' does not mean that a pedantic approach should be made. Why not every hour's delay, every second's delay? The doctrine must be applied in a rational common sense pragmatic manner. 4. When substantial justice and technical considerations are pitted against each other, cause of substantial justice deserves to be preferred for the other side cannot claim to have vested right in injustice being done because of a non- deliberate delay. 5. There is no presumption that delay is occasioned deliberately, or on account of culpable negligence, or on account of mala fides. A litigant does not stand to benefit by resorting to delay. In fact he runs a serious risk. 6. It must be grasped that judiciary is respected not on account of its power to legalize injustice on t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ner of Income Tax and Another, (2008) 306 ITR 196 (SC). Paragraph 13 of the decision of this Court in Sitaldas K. Motwani vs. Director General of Income Tax and Others (supra) is usefully quoted as under:- 13. The apex court, in the case of B.M. Malani Vs. CIT, (2008) 306 ITR 196 (SC); (2008) 10 SCC 617, has explained the term genuine in the following words (page 207): The term genuine as per the New Collins Concise English Dictionary is defined mere a ruse) The ingredients of genuine hardship must be determined keeping in view the dictionary meaning thereof and the legal conspectus attending thereto. For the said purpose, another well known principle, namely, a person cannot take advantage of his own wrong, may also have to be born in mind. 19. In this case, there is no doubt that the petitioner as well as its joint venture partner were entitled to deductions under Section 80 IB (10) of the Act. In fact as mentioned above, it is undisputed that for all the years from 2010-11 to 2013-14 except the year 2011-12 the deduction as claimed under the Section have been allowed by the department. That the income tax consultant has, as quoted above, stated on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... malafide nor an allegation that the delay has been deliberate. We do not find that the omission to file petitioner s return by the income tax consultant to be an act of negligence. Any person in his situation would have been mentally disturbed. The very fact that not only the petitioner s ITR was not filed in time, there were also 28 others whose return filing was delayed beyond the due date. The authorities should refrain from over analysis which leads to paralysis of justice. We are, therefore, of the view that the impugned order dated 7th May 2021 deserves to be set aside and is hereby set aside. 22. The income tax authority to act accordingly and consider the claim for deduction under Section 80 IB(10) for AY 2011-12 made by the petitioner in accordance with law, as if there was no delay in filing the return. The authorities under the DTVSV Act also to act in accordance with the said findings and amend Form 3 in respect of the amounts to be paid by the petitioner. 23. We make it clear that we have not delved into the merits of petitioner s claim under Section 80 IB (10) for AY 2011-2012 and if any observation has been made in this regard, it has only been for considering ..... X X X X Extracts X X X X X X X X Extracts X X X X
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