The central legal point established in the judgment is that the power given to the Central Board of Direct Taxes under section 119(2) of the Income Tax Act, 1961, allows it to admit a belated claim of refund, incorporating the provisions of section 5 of the Limitation Act, 1963, and ensuring fair enforcement of the tax provisions.

N.K.Sud, J.

1. The petitioner in this writ petition had filed a refund claim for the assessment year 1995-96 under section 237 of the Income Tax Act, 1961 (hereinafter referred to as "the Act"). Since the claim was made after the period of limitation prescribed in section 239 of the Act, he moved an application for condonation of delay under section 119(2)(b) of the Act which has been rejected by the Central Board of Direct Taxes (for short "the Board") without assigning any reasons vide order dated May 25, 2003 (annexure P-1). The petitioner impugns this order.

2. When the matter came up for motion hearing before a Division Bench of which one of us (N. K. Sud J) was a member, a decision of another Division Bench of this court in Niranjan Dass V/s. CBDT, 2004 266 ITR 489 (P&H), was relied upon to contend that the mandatory provisions of section 239 of the Act were not amenable to relaxation by the Board through instructions under section 119 of the Act. Interestingly, learned counsel for the assessee as well as the revenue contended that section 119(2)(b) of the Act specifically conferred such powers on the Board which had not been specifically noticed in Niranjan Dass (2004) 266 ITR 489 (P&H). Learned counsel for the revenue also pointed out that even the revenue had not accepted the judgment of this court in Niranjan Dass (2004) 266 ITR 489 (P&H) and had filed a special leave petition before the Supreme Court. The Division Bench also entertained its doubt about the correctness of the view expressed in Niranjan Dass (2004) 266 ITR 489 (P&H) and referred the following question of law for consideration by a Full Bench :

"Whether the conditions prescribed in section 239 of the Income Tax Act, 1961 , are amenable to relaxation at the hands of the Central Board of Direct Taxes through instructions under section 119 of the Act?"

Mr. P. C. jain, learned counsel for the assessee, contended as under :

3 Article 245 of the Constitution of India permits the Legislature to delegate various powers to the administrative agencies. The Legislature only declares the main law and its policy and it is not possible for it to apprehend and visualise each and every circumstance arising for the public so as to pronounce law for every situation. The powers are, thus, given to the administrative authorities to supplement the main law and not to supplant the main provision of law. The power conferred upon the Board under section 119(2)(b) of the Act to direct admission of an application for refund after the expiry of the period of limitation specified in section 239 of the Act does not violate or override the main provisions of law. It is in conformity with articles 265 and 300A of the Constitution of India which enshrine the principles of collection of tax, viz., "that no tax shall be levied or collected except by authority of law" and "that no person shall be deprived of his property save by the authority of law". These articles are based on the doctrine of unjust enrichment which provides that any tax collected without any entitlement or legality must be refunded to the citizen. Section 237 of the Act embodies these principles and mandates that in case a person has paid tax more than the amount properly chargeable from him, he shall be entitled to refund of the excess. However, the machinery for claiming refund has been provided in section 239 of the Act which also prescribes the period of limitation within which the claim for refund can be made. The time limit so prescribed is, however, subject to relaxation by the Board in terms of section 119(2)(b) of the Act, which is pari materia with the provisions of section 5 of the Limitation Act and empowers the Board to admit a belated claim of refund under certain circumstances.

4. Mr. Rajesh Bincial, learned counsel for the revenue, contended as follows : Section 119(2)(b) of the Act specifically provides that the Board may, if it considers desirable or expedient so to do, for avoiding genuine