Sirez Limited Vs Union of India & Ors. (Supreme Court of India)
In Sirez Limited Vs Union of India & Ors., the issue concerned condonation of delay in filing the Income Tax Return (ITR) for Assessment Year (AY) 2018–19 under Section 119(2)(b) of the Income Tax Act, 1961. The petitioner filed its ITR on 20.09.2021 with a delay of 30 months beyond the extended due date of 31.10.2018. An application was made seeking condonation of delay to enable carry forward of business loss of Rs. 1,06,60,750/- and claim refund/credit of TDS amounting to Rs. 19,73,540/-. The Central Board of Direct Taxes (CBDT) rejected the application by order dated 23.11.2023.
The petitioner contended that delay occurred due to inter se disputes among directors and financial hardship. It was argued that the dispute led to resignations, operational disruption, and inability to ensure timely compliance. The petitioner also relied on various judicial precedents emphasizing liberal interpretation of “genuine hardship” and argued that refusal to condone would result in denial of benefits under Section 72 and loss of TDS credit.
The respondents opposed the plea, submitting that statutory timelines must be adhered to and that internal disputes do not constitute genuine hardship. It was pointed out that the petitioner had filed ITRs for AY 2017–18 and AY 2019–20, demonstrating capacity to comply. The respondents further contended that no documentary evidence substantiated the alleged disputes or extraordinary circumstances.
