Bombay HC sets aside compounding plea rejection despite 36 month delay

L. T. Stock Brokers Pvt. Ltd. Vs Chief Commissioner of Income Tax (Bombay High Court) The Bombay High Court, in L.T. Stock Brokers Pvt. Ltd. v. Chief Commissioner of Income Tax, set aside an order rejecting a compounding application solely due to delay. The petitioner challenged the Chief Commissioner’s decision dated January 17, 2024, which dismissed the application under Section 279(2) of the Income Tax Act, 1961, citing a delay beyond 36 months, as per the Central Board of Direct Taxes (CBDT) guidelines of 2022. The court ruled that such rigid timelines imposed through guidelines could no...