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2021 Supreme(Bom) 142
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
UJJAL BHUYAN, ABHAY AHUJA, JJ.
Sanjay Ghodawat University, Kolhapur – Petitioner
Versus
Commissioner of Income Tax (Exemptions), Pune and Others – Respondents
Writ Petition (Stamp) No. 94842 of 2020
Decided On : 28-01-2021
Advocate Appeared:
For the Petitioners: Mihir Naniwadekar, Farzeen Khambatta.
For the Respondent: Sham Walve.
The central legal point established in the judgment is the power of the CBDT under section 119(2)(b) of the act to authorize the condonation of delay in filing applications for exemption under section 10(23C)(vi) of the Income Tax Act, 1961.
Headnote:
CBDT - Exemption under section 10(23C)(vi) - 10th proviso, 16th proviso, CBDT Circular No.19/2020 dated 03.11.2020 - The court discussed the provisions of section 10(23C)(vi) of the Income Tax Act, 1961, the 10th proviso, and the 16th proviso. It also highlighted the CBDT Circular No.19/2020 dated 03.11.2020 and its clarification dated 07.12.2020. The court emphasized the difference between Form No.10BB and Form No.56D and the power of the CBDT under section 119(2)(b) of the act.
Fact of the Case:
The petitioner, Sanjay Ghodawat University, Kolhapur, filed a petition seeking quashing of the order rejecting its application for exemption under section 10(23C)(vi) of the Income Tax Act, 1961 for the assessment year 2019-20 onwards.
Finding of the Court:
The court found that while the application for the assessment year 2019-20 was time-barred, the application for subsequent assessment years was not. It directed the petitioner to file an application before the CBDT to condone the delay for the assessment year 2019-20 and directed respondent No.1 to consider the application for the assessment year 2020-21 onwards.
Issues: The main issue was the rejection of the petitioner's application for exemption under section 10(23C)(vi) of the act and the jurisdiction of the CBDT and respondent No.1 to condone the delay in filing the application.
Ratio Decidendi: The court held that while the application for the assessment year 2019-20 was time-barred, the subsequent assessment years' applications were not. It emphasized the power of the CBDT under section 119(2)(b) of the act to authorize the condonation of delay in filing such applications.
Final Decision: The court directed the petitioner to file an application before the CBDT to condone the delay for the assessment year 2019-20 and directed respondent No.1 to consider the application for the assessment year 2020-21 onwards. The impugned order was interfered with to the extent mentioned.
JUDGMENT :
UJJAL BHUYAN, J.
1. Heard Mr. Mihir Naniwadekar, learned counsel for the petitioner and Mr. Sham Walve, learned standing counsel revenue for the respondents.
2. By fling this petition under Articles 226/227 of the Constitution of India, petitioner seeks quashing of order dated 29.09.2020 passed by the Commissioner of Income Tax (Exemptions), Pune rejecting the application of the petitioner dated 31.10.2019 for exemption under section 10(23C)(vi) of the Income Tax Act, 1961 for the assessment year 2019-20 onwards and further seeks a direction to the respondents to consider the said application on merit and thereafter to allow the same.
3. Case of the petitioner is that it is a university called Sanjay Ghodawat University, Kolhapur established by an act of the State Legislature of Maharashtra and which became operational on and from 13.07.2017.
4. It is stated that because of heavy rainfall and resultant flood in different parts of the country, Central Board of Direct Taxes (CBDT) passed an order dated 27.09.2019 under section 119 of the Income Tax Act, 1961 (briefly “the act” herein-after) extending the due date for filing of income tax returns as well as reports of audit for the assessment year 2019-20 from 30.09.2019 to 31.10.2019.
5. With a view to avail exemption under section 10(23C)(vi) of the act for the assessment year 2019-20 and onwards, petitioner filed the related application in Form No.56Di before Commissioner of Income Tax (Exemptions), Pune i.e. respondent No.1 on 31.10.2019. Petitioner has explained that due to exceptional situation prevailing in Kolhapur region because of flood, it was not possible to complete the audit of the accounts of the petitioner before the said date which caused delay in filing the application.
6. Responding to letter dated 26.06.2020 of respondent No.1, petitioner submitted a detailed reply providing all the details and documents as sought for vide its reply dated 29.06.2020.
7. However, notice dated 15.09.2020 was issued to the petitioner by respondent No.1 informing the petitioner that its application filed on 31.10.2019 was not within the prescribed time limit; such application was required to be filed on or before 30th September of the relevant assessment year from which exemption was sought. However, referring to the earlier letter dated 26.06.2020 it was stated that the same was not complied with and therefore petitioner was called upon to furnish the details on or before 18.09.2020 which was duly complied with by the petitioner by filing detailed reply dated 18.09.2020. It was contended that though the time limit for filing application seeking exemption under section 10(23C)(vi) of the act was till 30.09.2019 the same stood extended till 31.10.2019 in terms of CBDT order dated 27.09.2019. Referring to the earlier letter dated 26.06.2020 petitioner pointed out that it had responded to the said letter by furnishing the required particulars.
8. However, by the impugned order dated 29.09.2020 respondent No.1 rejected the said application of the petitioner on the ground that the application was filed beyond the prescribed time limit and that respondent No.1 had no jurisdiction to condone the delay in the filing of such delayed application.
9. Aggrieved, present Writ Petition has been filed seeking the reliefs as indicated above.
10. In the hearing held on 05.11.2020 learned counsel for the petitioner had produced before us a copy of Circular No.19/2020 dated 03.11.2020 issued by CBDT and had contended that by the said circular power of condonation of delay had been delegated by the CBDT to the Commissioners. However, Mr. Walve, learned standing counsel revenue had contended that the said circular was not applicable to the case in hand. Thereafter the matter was heard. In the hearing clarification of the CBDT dated 07.12.2020 regarding Circular No.19/2020 dated 03.11.2020 was also produced. Both the said Circular No.19/2020 dated 03.11.2020 and the clarification dated 07.12.2020 have
