Case Law Details
Case Name : Avinash Gupta Vs UOI (Delhi High Court)
Appeal Number : WP No. 9032/2015
Date of Judgement/Order : 21/09/2015
Related Assessment Year :
In a Historic/Landmark Judgment Delhi High Court in the case Avinash Gupta Vs. UOI has although not allowed extension of due date for filing ITR for AY 2015-16 but instructed the Govt. to ensure availability of forms for tax audit from the beginning of next assessment year. The Court has taken the cognisance of delay by CBDT in release of ITR forms which has become a habit of CBDT.
The Judgment will have long lasting effect as it may awake those involved and responsible for timely release of Income Tax Forms. Let’s Hope that CBDT/Govt will release ITR and other forms related to Tax Audit timely and as per the direction of Hon’ble Delhi High Court from A.Y. 2016-17.
Brief of the case:
In the present case petitioner, who is a chartered accountant, filed writ before Hon’ble HC and prayed to give direction to CBDT or Govt. of India to extend the date of filing the ITR and tax audit report u/s 44 AB to extent of the delay in number of days in notifying the prescribed forms under rule 12 of the IT Rules. It was also prayed to quash the notification dated 09.09.2015 by which respondents has not extended the date of filing ITR due by 30.09.2015. It was argued that in another category of assessees the time limit for filing ITR was extended due to which tax practitioner remained engaged in filing ITR of those assessees. After considering all the facts and circumstances court found itself unable to grant relief to the petitioner in absence of any legal mistake but after taking into consideration of moral mistake of respondents in not notifying the prescribed forms directed Govt. of India and CBDT to ensure the availability of prescribed forms under rule 12 of the IT Rules from the beginning of the next assessment year.
Facts of the case:
- The notification dated 09.09.2015 was challenged before HC by way of writ no. 8771/2015 which was withdrawn by the petitioner as non-maintainable in absence of cause of action in favour of petitioner with a liberty to file PIL.
- Again now in this writ bearing no. 9032/2015 the petitioner pleaded his own cause of action.
- The petitioner is a chartered accountant who was engaged by various clients/assessees to file their ITRs and also in his own personal capacity in not filing his own ITR being subject to audit.
Relief sought by way of present writ petition:
- To declare that the time prescribed for filing ITR is constitutional and statutory right of the assessee.
- To declare that delay in notifying prescribed forms under rule 12 of IT Rules was unconstitutional and is consequences of abdication or resignation of powers by respondents.
- To extend the due date of filing ITRs and furnishing tax audit report u/s 44AB to the extent of delay in notifying the prescribed forms.
- To declare notification dt. 09.09.2015 as null and void and to quash the same.
- To extend the due date of filing ITR due by 30.09.2015 for categories of assesses Including Companies, and Firms and, Individuals Engaged in Proprietary Business / Profession etc., whose Accounts are required to be Audited as per Income Tax Act, 1961 from 30.09.2015 to 31.12.2015.
Contention of the Assessee:
- Explanation 2 to Section 139(1) of the IT Act as amended by Finance Act, 2015 prescribes the “Due Date” i.e. the date for filing the ITRs of entities whose accounts are required to be audited as 30th September of the assessment year i.e. to say for the Financial Year 1st April, 2014 to 31st March, 2015, the due date of the Assessment Year 2015-2016 would be 30th September, 2015.
- Section 119(2) empowers the CBDT to issue general or special orders on various times including by way of relaxation of any of the provisions of inter alia Section 139.
- CBDT can extend the due date as done in the same year in another group of assessees i.e. not responsible to audit. The date was extended from 31.07.2015 to 31.07.2015 which was again extended to 07.09.2015.
- There is a delay on the part of the respondents in prescribing the form of the return to be filed by the assessees due date wherefor is 30.09.2015. The said forms were prescribed only vide Notification dated 29.07.2015 and were made available only w.e.f. 07.08.2015.
- There is laxity found on part of respondents in in notifying the prescribed forms, which was made available much after the commencement of assessment year i.e. w.e.f 07.08.2015.
- The due date should be extended to the extent of delay in notification of forms.
- Since the Assessment Year 2015-2016 commenced on 01.04.2015 and the due date for filing the return is 30.09.2015, i.e. after 180 days after commencement of AY and hence 180 days are required to be given as a matter of right, it matters not whether the petitioner has suffered any prejudice or not.
- The persons practising in taxation were under the bona fide impression that upon the promulgation of the Financial (No.2) Act, 2014, Form 3CD for furnishing the Tax Audit Report would be amended / modified but which was not done for the Assessment Year 2015-2016.
- The respondents will not suffer any prejudice by granting such extension of time beyond 30th September, 2015 for filing ITR inasmuch as interest, if any payable on the tax due would then be paid till the extended date for filing of the ITR.
- Since the due date of 31st July was extended till 7th September, the practitioners of Income Tax remained busy till 7th September, 2015 in filing the returns of the assessees due date wherefor was 31st July and have been left with very little time for assessees due date wherefor is 30th September, 2015.
- Such a representation was also made by Institution of Chartered Accountant of India.
Held by the Court:
- The period claimed by the petitioner as a matter of right of 180 days for filing the ITR is admittedly not prescribed, neither in the Statute nor in the Rules.
- Filing of ITR within 180 days is dependent upon the accounts of the assessee being audited and which the counsel for the petitioner begins only on the beginning of assessment year. The said audit, in the case of some assesses may be completed in a few days and in case of others may take longer.
- The said audit is not dependent upon the prescription of the forms for report of the said audit and / or for filing of the ITR. Audit, as per my understanding is to be as per the Guidelines prescribed by the Institute of Chartered Accountants of India
- If any for amendment to the form of the Audit Report and /or of the form for filing the ITR is not to interfere with the commencement or completion of the audit and which can by no stretch of imagination be said to be a small task.
- Once the audit is complete, in my opinion, the time admittedly available from 29th July, 2015 / 7th August, 2015 to 30th September, 2015 cannot be said to be so small / short which would qualify as unreasonable and in which the Chartered Accountants and the other practitioners of the field cannot be said to be having sufficient time to fill up the forms as per the audit already completed and to file the ITR.
- The respondents, while have extended time for filing of the ITR from the due date of 31st July to 7th September, after having brought out the Notification dated 29th July, 2015 were of the opinion that there was no need for extension of due date of 30th September.
- The respondents, vide Press Release dated 09.09.2015 have notified that the date of 30th September will not be extended and have advised the taxpayers to file the returns accordingly. It is thus not as if the respondents have kept the decision in this regard pending till the last date. After 9th September also, sufficient time is available for filing the ITR.
- The petitioner, has neither been able to make out any case of any time being prescribed to be made available to the assessee, after the form of audit report and ITR have been prescribed, for filing the ITR nor has been able to make out a case of the same causing any prejudice to himself.
- As regarding the delay in notifying prescribed forms court held that there is sufficient time available to the Government, after the Finance Act of the financial year, to finalise the forms and if no change is intended therein, to notify of the same immediately. There appears to be no justification for delay beyond the assessment year in prescribing the said forms.
- There is however some merit, if not legal then otherwise, in the grievance of the petitioner. Considering the same the respondents are directed to, with effect from the next assessment year, at least ensure that the forms etc. which are to be prescribed for the Audit Report and for filing the ITR are available as on 1st April of the assessment year unless there is a valid reason therefor and which should be recorded in writing by the respondents themselves, without waiting for any representations to be made.
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Tax Audit Date Extension- Status of High Courts Appeals