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TMI Blog2024 (11) TMI 1434X X X X Extracts X X X X X X X X Extracts X X X X ..... ercise of option under Section 115BAA of the Act would cause genuine hardship and it is desirable and expedient to permit the petitioner to file Form 10-IC in support of its claim / option under Section 115BAA of the Act and deal with such claim on merits in accordance with law.
The impugned order is set-aside, the respondent shall keep the portal open to enable the petitioner to upload the Form 10-IC and the petitioner shall file the Form 10-IC within a period of four weeks from the date of receipt of a copy of this order, thereafter the respondent shall proceed to deal with the claim of the petitioner under Section 115BAA on merit. X X X X Extracts X X X X X X X X Extracts X X X X ..... nique number/Document Identification number (DIN) Date of such Notice or Order or if filed u/s 92CD enter date of advance pricing agreement Residential Status RES-Resident Whether the assessee has opted for taxation under section 115BA/115BAA/115BAB? (applicable on Domestic Company) Section 115BAA Whether total turnover/gross receipts in the previous year 2017-18 exceeds 400 crore rupees? (Yes/No) (applicable for Domestic If filed, in response to a notice u/s 139(9)/142(1)/148/153A/153C or order under section 119(2)(b), enter unique number/Document Identification Number (DIN) and date of such notice/Order, or if filed u/s 92CD enter date of advance pricing agreement Company) Whether assessee is a resident of a country or specified territory with which India has an agreement referred to in section 90(1) or Central Government has adopted any agreement under sec 90A(1) In the case of non-resident, is there a permanent establishment (PE) in India 3.2. Thereafter, a notice was issued on 06.08.2021 under Section 143(1) of the Act, raising a demand levying taxes at 30%, wherein it was indicated that the tax paid/discharged by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Officers to pass appropriate orders reducing the levied rate of tax to 22% as applicable to the class of assessees who had opted for taxation under Section 11BAA of the Act." 7. The said prayers were rejected vide impugned order dated 02.11.2023, after receiving the report from the Assessing Officer. The first respondent has proceeded to pass the impugned order rejecting the request under Section 119(2)(b) of the Act, on the premise that the petitioner has not put forward any reasonable cause beyond its control which prevented it from filing Form 10-IC for the Assessment Year 2020-2021. It was also found that the petitioner had no valid reasons to justify the delay. The relevant portion is extracted hereunder: "b. With respect to the submission of the applicant that it has filed three grievance petitions it is stated that these are not related to filing of Form 10-1C and filed after the extended date of filing Form 10-IC (Le., 30.06.2022). 8. It is noted that no reasonable cause has been shown or established to justify the claim of genuine hardship under section 119(2)(b) of the Act. The legislature has provided time limits for certain obligation under the act and these time l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ould be relevant to extract Section 119(2)(b) of the Act, which reads as follows: "(b) the Board may, if it considers it desirable or expedient so to do for avoiding genuine hardship in any case or class of cases, by general or special order, authorise [any income-tax authority, not being [a Joint Commissioner (Appeals) or] a [***] Commissioner (Appeals)] to admit an application or claim for any exemption, deduction, refund or any other relief under this Act after the expiry of the period specified by or under this Act for making such application or claim and deal with the same on merits in accordance with law;" 10. Section 119(2)(b) vests power in the Board to admit an application or claim for any exemption, deduction, refund or any other relief under the Act after the period specified under the said Act, for making such application or claim, if it is considered by the Board to be desirable or expedient so to do for avoiding genuine hardship in any case or class of cases. 11. On a reading of Section 119(2)(b) of the Act, in particular, the enabling words "may" employed therein, would suggest that power conferred is prima facie discretionary. However, if the object for which th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ne occasion before various Court, including this Court and the Apex Court. It appears that it has been consistently held that the power conferred under Section 119(2)(b) of the Act, ought to be exercised liberally provided circumstances set out therein exist. Here it may be relevant to keep in view the decision of the High Court of Bombay in the case of Pankaj Kailash Agarwal v. CIT, reported in (2024) 464 ITR 65, wherein it was held that no assessee would stand to benefit by lodging its claim late. More so, where the assessee would get tax advantage/benefit. It was held that the fact that an assessee feels that he would be paying more tax if he does not get the advantage of deduction will certainly constitute "genuine hardship". The phrase "genuine hardship" used in section 119(2)(b) of the Act should be construed liberally. The Legislature has conferred the power to condone the delay to enable the authorities to do substantial justice to the parties by disposing of the matters on merits. 14. This Court is of the view that there is a gross mis-direction by the respondent inasmuch as there is non-application of mind as to whether the failure to consider the claim of option to disc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ge the tax was exercised under Section 115BAA of the Act and taxes were in fact paid @ 22% without claiming deductions as contemplated under Section 115BAA of the Act. In this regard, it may be relevant to refer to the Hon'ble Supreme Court, in the case of Dilip Kumar (2018) 9 SCC , wherein while deciding the Doctrine of Substantial Compliance held as under: "33. A fiscal statute generally seeks to preserve the need to comply strictly with regulatory requirements that are important, especially when a party seeks the benefits of an exemption clause that are important. Substantial compliance with an enactment is insisted, where mandatory and directory requirements are lumped together, for in such a case, if mandatory requirements are complied with, it will be proper to say that the enactment has been substantially complied with notwithstanding the non-compliance of directory requirements. In cases where substantial compliance has been found, there has been actual compliance with the statute, albeit procedurally faulty. The doctrine of substantial compliance seeks to preserve the need to comply strictly with the conditions or requirements that are important to invoke a tax or du ..... X X X X Extracts X X X X X X X X Extracts X X X X
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