Karnataka HC allows Trust’s delay in filing Income Tax Return & Form 10

Jawaharlal Nehru Educational & Charitable Trust Vs CIT (Karnataka High Court)

Petitioner sought  quashing of the  order   passed by CIT(E) whereby the application filed by the petitioner u/s 119(2)(b) seeking condonation of delay of 151 days in filing the income tax returns & Form 10 in relation to the AY 2018-19 was rejected

Dept argued that there is no merit in the petition & the same is liable to be dismissed.

The High Court opined that CIT(E) has adopted hyper technical approach in refusing to condone the delay without appreciating that the inability & omission on the part of the petitioner to file I.T. returns & Form 10 within the prescribed period was due to non-compliance on the part of the tax consultant of the petitioner as a result of which, the petitioner could file the I.T. returns & Form 10 subsequent to expiry of the prescribed period. The Dept failed to appreciate that the petitioner could not file its I.T. returns & Form 10 within the prescribed period on account of bonafide reasons, unavoidable circumstances & sufficient cause, which clearly constituted genuine hardship on the part of the petitioner/assessee as contemplated in the Circular dated 09.06.2015 & failure to appreciate this, has resulted in erroneous conclusion warranting interference by the Court.

Adopting justice oriented approach & having regard to valid & sufficient ground pleaded by the petitioner in support of his claim for condonation of delay, the High Court  set aside the  order & condone the delay in filing the returns & Form 10.

FULL TEXT OF THE JUDGMENT/ORDER OF KARNATAKA HIGH COURT

In this petition, petitioner seeks quashing of the impugned order at Annexure – A dated 31.01.2024 passed by the respondent No.1, whereby the application filed by the petitioner under Section 11 9(2)(b) seeking condonation of delay of 151 days in filing the income tax returns and Form 10 in relation to the Assessment Year 2018-19 was rejected by the respondent No.1.

2. Heard learned counsel for the petitioner and learned counsel for the respondents and perused the material on record.

3. A perusal of the material on record will indicate that in relation to the aforesaid Assessment Year 2018-19, the petitioner filed returns after the prescribed period along with the application seeking condonation of delay of 151 days in filing the return of income and Form 10 interalia contending that the tax consultant who was entrusted with filing of returns for the petitioner failed to do so and owing to bonafide reasons, unavoidable circumstances and sufficient cause, the petitioner was not in a position to file the returns within the prescribed period. It was contended that the delay in filing the I.T. returns and Form 10 was due to genuine hardship as contemplated in the Circular No.9/2015 dated 09.06.2015 and as such, the respondent committed an error in rejecting the application for condonation of delay filed by the petitioner under Section 11 9(2)(b) of the I.T.Act, which deserves to be set aside.

4. Per contra, learned counsel for the respondents-Revenue would support the impugned order and submits that there is no merit in the petition and the same is liable to be dismissed.

5. A perusal of the impugned order will indicate that the respondents have adopted hyper technical approach in refusing to condone the delay without appreciating that the inability and omission on the part of the petitioner to file I.T. returns and Form 10 within the prescribed period was due to non-compliance on the part of the tax consultant of the petitioner as a result of which, the petitioner could file the I.T. returns and Form 10 subsequent to expiry of the prescribed period. The respondents failed to appreciate that the petitioner could not file its I.T. returns and Form 10 within the prescribed period on account of bonafide reasons, unavoidable circumstances and sufficient cause, which clearly constituted genuine hardship on the part of the petitioner/assessee as contemplated in the said Circular dated 09.06.2015 and failure to appreciate this, has resulted in erroneous conclusion warranting interference by this Court in the present petition.

6. Under these circumstances, adopting justice oriented approach and having regard to valid and sufficient ground pleaded by the petitioner in support of his claim for condonation of delay, I deem it just and appropriate to set aside the impugned order and condone the delay in filing the returns by the petitioner by allowing the application filed by the petitioner.

7. In the result, I pass the following:

O R D E R

(i) The petition is hereby

(ii) The impugned order at Annexure – A dated 01.2024, is hereby set-aside;

(iii) The application filed by the petitioner under Section 11 9(2)(b) for condonation of delay of 151 days in filing Income Tax Returns and Form 10 for the Assessment Year 2018-19, is hereby allowed;

(iv) The respondents are directed to accept the return of income and Form 10 submitted by the petitioner for the aforesaid Assessment Year 201 8-1 9;

(v) It is needless to state that respondents are at liberty to verify the claim of the petitioner and proceed further in accordance with law.