Monica Elande Vs CIT (IT And TP) (Gujarat High Court)
Gujarat High Court recently overturned a decision by the Commissioner of Income Tax, International Taxation & Transfer Pricing, Ahmedabad, to reject a non-resident Indian’s application for condonation of delay in filing her income tax return for Assessment Year 2022-23. The ruling, in the case of Monica Elande Vs. CIT (IT & TP), emphasizes a liberal interpretation of “genuine hardship” under Section 119(2)(b) of the Income Tax Act, 1961, particularly when substantial justice is at stake.
The petitioner, a U.S. resident, had not filed an income tax return in India for 22 years. During Assessment Year 2022-23, she sold a jointly owned residential flat for ₹29,50,000, leading to a Tax Deducted at Source (TDS) of ₹6,74,960 on the gross sale consideration, disregarding expenses and acquisition costs. The petitioner later calculated her actual tax liability as “NIL,” entitling her to a full refund of the TDS amount.
However, the petitioner, being a non-resident and unaware of recent amendments to Section 139(4) of the Act, believed no return was necessary given her zero tax liability. Section 139(4) now limits the filing of belated returns to three months prior to the end of the relevant assessment year, meaning her return for AY 2022-23 was due by December 31, 2022. It was only upon her visit to India in September 2023 that her tax consultant informed her of the invalidity of a belated filing.
