Arulmigu Gnanamalai Murugan Educational Trust Vs CIT (Exemption (Madras High Court)
Summary: The Madras High Court considered a writ petition challenging the order dated 08.09.2025 rejecting the petitioner’s application for condonation of delay under Section 119(2)(b) of the Income Tax Act, 1961. The petitioner, an educational trust, stated that its statutory audit report was made ready only on 30.12.2020 and, consequently, the return of income could be filed only on 15.02.2022. After receiving a demand notice dated 24.06.2025, the petitioner replied and thereafter filed the application seeking condonation of delay. An appeal filed before the Income Tax Tribunal was rejected on the ground that an appeal would not lie against such order. The Revenue relied on Circular No.16/2024 dated 18.11.2024, submitting that the circular was binding on the Income Tax Department and precluded consideration of such an application after three years from the end of the relevant financial year. The High Court observed that Section 119(2)(b) does not contain any restriction fettering the discretion of the Income Tax authority to condone delay. Taking note that the petitioner was a charitable trust and had cited delay in submission of the statutory audit report as the reason for delayed filing, the Court held that the petitioner had approached the Commissioner belatedly. Subject to payment of Rs.15,000 as costs to the Adyar Cancer Institute, Chennai within two weeks from receipt of a copy of the order, the Court set aside the order dated 08.09.2025 and condoned the delay. The second and third respondents were directed to give effect to the order and proceed further with the assessment accordingly. The writ petition was disposed of and connected writ miscellaneous petitions were closed.
Related TaxGuru Coverage: The ruling concerns the scope of Section 119(2)(b) and condonation of delay in matters involving charitable and educational trusts. TaxGuru has also reported on Madras High Court condoning delay in Form 10B filing despite a CBDT time limit, as well as cases concerning delay in Form 10B filing and trust exemption. TaxGuru has also published material on CBDT condonation of delay under Section 119(2)(b) for Form 10B and authority to condone delay for charitable institutions.
FULL TEXT OF THE JUDGMENT/ORDER OF MADRAS HIGH COURT
An order dated 08.09.2025 rejecting the petitioner’s application to condone delay under Section 119(2)(b) of the Income Tax Act, 1961 (I-T Act) is assailed in this writ petition.
2. Learned counsel for the petitioner submits that the petitioner is an educational trust. In view of the statutory audit report being made ready only on 30.12.2020, it is stated that the return of income could be filed only on 15.02.2022. Upon receiving demand notice dated 24.06.2025, it is stated that the petitioner replied thereto and thereafter filed the application to condone https://www.mhc.tn.gov.in/judis delay. Against the rejection order, she submits that an appeal was filed before the Income Tax Tribunal. Said appeal was rejected on the ground that an appeal would not lie against such order.
3. Mr.V. J. Arul Raj, learned senior standing counsel, appears on behalf of the respondent. He places reliance on Circular No.16/2024 dated 18.11.2024 and submits that the circular is binding on the Income Tax Department. He points out that such circular precludes the consideration of such application after the lapse of three years from the end of the relevant financial year.
4. Section 119(2)(b) of the I-T Act does not contain any restriction fettering the discretion of the Income Tax authority to condone delay. The petitioner is a charitable trust. The reason cited for delayed filing of returns is the delay in the submission of the statutory audit report. Undoubtedly, the petitioner has approached the Commissioner belatedly. Therefore, subject to the payment of a sum of Rs.15,000/- (Rupees Fifteen Thousand only) as costs to the Adyar Cancer Institute, Chennai within two weeks from the date of receipt of a copy of this order, the order dated 08.09.2025 is set aside and the delay is condoned. Consequently, the second and third respondents are directed to give effect to this order and proceed further with the assessment on such basis.
5. This writ petition is disposed of on the above terms. Consequently, the connected writ miscellaneous petitions are closed. There shall be no order as to costs
