Introduction: Circular No. 13/2023-Income Tax, Dated: 26th July, 2023, addresses the condonation of delay under section 119 of the Income Tax Act, 1961, specifically for returns claiming deduction under section 80P for assessment years 2018-19 to 2022-23.
This communication addresses the condonation of delay under clause (b) of sub-section (2) of section 119 of the Income Tax Act, 1961, specifically for returns of income claiming deduction under section 80P of the Act for various assessment years from AY 2018-19 to AY 2022-23.
The Finance Act of 2018 introduced changes to section 80AC of the Act, stating that no deduction shall be allowed unless the taxpayer furnishes the return of income by the specified due date.
The Central Board of Direct Taxes (CBDT) has received applications from co-operative societies seeking condonation of delay for filing returns of income, citing delays in getting accounts audited under respective State Laws.
In response, the CBDT, under its powers conferred by section 119 of the Act, directs Chief Commissioners of Income Tax (CCsIT) and Directors General of Income Tax (DGsIT) to handle applications for condonation of delay. They are instructed to decide on the merits of each case, admitting both pending and new applications for assessment years 2018-19 to 2022-23.
In assessing these applications, CCsIT/DGsIT are required to ensure that the delay was due to circumstances beyond the control of the assessee, supported by appropriate documentary evidence. They must also consider cases where the delay resulted from the audit process under State Laws, examining the completion date of the audit in comparison to the due date for filing the return of income. Additionally, any issues indicating tax avoidance or evasion specific to the case should be thoroughly scrutinized.
Cases falling under specific circumstances (para 6(iii)) may require further legal action.
CCsIT/DGsIT are expected to expedite the processing of these applications, ideally disposing of them within three months from the end of the month in which the application is received or transferred by the Board. The communication emphasizes that no order rejecting the application should be passed without providing the applicant an opportunity to be heard.
Conclusion: Circular 13/2023 facilitates the condonation process for 80P deduction returns, acknowledging genuine delays and ensuring a fair evaluation of each case. The emphasis on timely processing and a fair hearing demonstrates the CBDT’s commitment to facilitating genuine claims while maintaining tax compliance.
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