Case Law Details
DD 203 Aranmanaipatty Primary Agricultural Co-operative Credit Society Vs Chief Commissioner of Income Tax (Madras High Court)
The Madras High Court allowed the writ appeal filed against the order dated 23.01.2025 passed in WP(MD) No.1810 of 2025 concerning rejection of a delay condonation application for filing income tax returns for the assessment year 2021-22.
The appellant, a Co-operative Society registered under the provisions of the Tamil Nadu Co-operative Societies Act, 1983, had failed to file its annual income tax returns within the time prescribed by the Income Tax Department. Subsequently, the Society filed an application seeking condonation of the delay. The authorities rejected the application, and since no appeal was available against such rejection, the appellant approached the Court. The learned Single Judge had dismissed the petition on the ground that the appellant had failed to produce documents substantiating the request for condonation of delay.
Before the Division Bench, the respondents argued that the Society had not furnished any documents or sufficient reasons to justify the prolonged delay in filing the returns and, therefore, the rejection of the condonation application was justified.
The Court noted that the appellant was a Co-operative Society whose members consisted of farmers investing their hard-earned money in the Society. The Society functioned using funds contributed by its own members without any direct contribution from the Government. The Court observed that if the Society’s case for acceptance of delayed returns was not considered, the interests of these small farmers, who were members and investors, would be adversely affected.
At the same time, the Court found that the delay had occurred due to lapses committed by the Administrators of the Society. It held that the Administrators were accountable and responsible for the prolonged delay in filing the annual income tax returns within the prescribed timelines. The Court further directed that the Joint Registrar of Co-operative Societies should initiate appropriate action against the Administrators responsible for such lapses before the competent authority.
However, the Court held that the farmers who had invested in the Society should not suffer because of the mistakes committed by the Society’s staff or administrators. Exercising its discretion, the Court condoned the delay and directed the appellant to submit copies of the income tax returns to the respondent authorities. The respondents were directed to take the returns on file, scrutinize them, and pass appropriate orders in accordance with the provisions of the Act and Rules.
Accordingly, the writ appeal was allowed, without any order as to costs.
FULL TEXT OF THE JUDGMENT/ORDER OF MADRAS HIGH COURT
The writ appeal has been filed against the order dated 23.01.2025 made in WP(MD). No.1810 of 2025.
2. The facts in nutshell shows that the appellant Co-Operative Society failed to file annual returns for the assessment year 2021-2022 within the time limit prescribed by the Income Tax Department. There was a delay and condone delay petition was filed and the same was rejected by the authorities. No appeal lies against the order of rejecting the condone delay application and therefore the writ appeal came to be instituted. The learned Single Judge made a finding that the appellant failed to submit any of the documents to substantiate the condone delay petition.
3. The learned counsel for the respondent would strenuously opposed by stating that the appellant Society has not produced any document or reason for condoning their long delay in filing the returns and therefore, the Writ Court has rightly rejected the application.
4. Appellant is a Co-Operative Society registered under the provisions of the Tamil Nadu Co-Operative Societies Act, 1983. The members of the appellant Society are farmers and they are investing their hard earned money in the Co-Operative Society. The Society is serving to its members from and out of the funds invested by its own members and there is no direct contribution from the Government. In the event of not considering the case of the appellant for filing returns, the interest of these small farmers who all are the members of the Co-Operative Society will be get affected. Undoubtedly, the delay in filing return arose on account of the lapses committed by the Administrators of the Society. The Administrators are accountable and responsible for such a long delay in filing the annual income tax return as per the time line fixed by the Income Tax Department. Therefore, the Joint Registrar of Co-Operative Societies has to initiate appropriate action against the Administrators who have committed lapses in filing the income tax return to the competent authority. However, on account of such lapses on the part of the staff of the appellant Co-operative Society, the farmers who are investors in the Society need not made to suffer.
5. Therefore, this Court is inclined to exercise its discretion for the purpose of condoning the delay and for the acceptance of returns, if it is otherwise in order and in accordance with the provisions of the Act and Rules.
6. In view of the facts and circumstances, the delay in filing the income tax returns stands condoned and the appellant is directed to file the copy of the income tax returns to the respondent and the respondent is directed to take on file the income tax returns to be filed by the appellant, scrutinize the same and pass appropriate orders.
7. With the above observations and directions, the writ appeal stands allowed. There shall be no order as to costs. Consequently, the connected miscellaneous petition is closed.
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