Sikkim Ferro Alloys Ltd Vs Central Board of Direct Taxes & Ors (Bombay High Court)
This writ petition challenged an order dated 17 January 2024 passed by the Central Board of Direct Taxes (CBDT) under Section 119(2)(b) of the Income Tax Act, 1961, whereby the petitioner’s application for condonation of delay in filing its return of income for Assessment Year (AY) 2018–19 was rejected. The rejection resulted in denial of the benefit of carrying forward a business loss of ₹21,32,55,935.
The petitioner, a limited company engaged in trading ferrous and non-ferrous metals, computed a business loss of ₹22,14,64,051 and short-term capital gains of ₹33,81,310 for AY 2018–19. After inter-head adjustment under Section 71, it declared nil income under both normal provisions and Section 115JB. Business loss of ₹21,32,55,935 and unabsorbed depreciation of ₹48,26,806 were claimed to be carried forward.
The petitioner’s accounts were subject to tax audit under Section 44AB and audit under the Companies Act, 2013. The due date for filing the return under Section 139(1) was 31 October 2018. The tax audit report dated 7 August 2018 was uploaded at 11:44 p.m. on 31 October 2018. However, the return of income in Form 6 was uploaded at 12:08 a.m. on 1 November 2018, resulting in a delay of eight minutes. Consequently, only depreciation was permitted to be carried forward, while the business loss was disallowed under Section 80 due to late filing.
