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HIGH COURT OF MADRAS
Honourable Mr Justice SENTHILKUMAR RAMAMOORTHY
SERAMUDALI KABEER HAMIDALI – Appellant
Versus
THE ADDITIONAL COMMISSIONER OF INCOME TAX – Respondent
Income Tax - Income Tax Act - [Section 119(2)(b), 139(4)] - The court evaluated the application for delay condonation in filing tax returns, focusing on genuine medical hardships and the importance of timely tax compliance. It established the criteria under which delays can be excused based on genuine difficulties faced by taxpayers.
Fact of the Case:
The petitioner sought to condone a delay of 927 days in filing an income tax return for the assessment year 2020-21 due to the prolonged illness and subsequent death of his Chartered Accountant. The application for condonation was rejected, prompting the writ petition.
Finding of the Court:
The court found that the petitioner provided valid reasons for the delay and established genuine hardships, citing the illness and death of the Chartered Accountant as key factors that warranted the condonation of delay.
Issues: Whether the rejection of the application for condonation of delay under Section 119(2)(b) was justified given the circumstances surrounding the delay in filing the income tax return.
Ratio Decidendi: The court held that genuine hardships, when established adequately, should warrant the condonation of delays in compliance with tax filing requirements, especially when the taxpayer adheres to all other obligations.
Final Decision: The court set aside the rejection order and directed the respondents to process the petitioner's return of income.
ORDER
An order rejecting an application under Section 119(2)(b) of the Income Tax Act,1961, (“I-T-Act”) is challenged in this writ petition.
2. The petitioner is assessed to tax under PAN AAPH6489G. As regards assessment year 2020-21, the petitioner asserts that he was unable to file the return within time on account of the prolonged illness of his former Chartered Accountant, namely, Mr. U. Mohamed Sahabdeen and his eventual demise on 07.11.2022. In those circumstances, the petitioner filed an application for condonation of delay for filing the return on 13.07.2023. The present writ petition was filed on account of rejection of such application by order dated
23.02.2024.
3. Learned counsel for the petitioner submitted that the petitioner does not seek a refund or exemption and that the application to condone delay was filed so as to enable the petitioner to file the return of income for assessment year 2020-21 along with applicable taxes and interest. He points out that the petitioner filed returns for preceding assessment years such as 2015-16, 2016-17, 2017-18, 2018-19 and 2019-20. He also points out that the certificate issued by the doctor to the petitioner's erstwhile Chartered Accountant was placed on record as evidence of his prolonged illness on account of the Covid-19 pandemic. By referring to the death certificate, he pointed out that the former Chartered Accountant passed away on 07.11.2022. Learned counsel also submits that the impugned order warrants interference because the application was rejected in spite of the petitioner establishing that there were bona fide reasons for not filing the return in time.
4. Mrs. Premalatha, learned junior standing counsel, accepts notice for the respondents. By inviting my attention to the impugned order at paragraphs 6.1 & 6.6 thereof, she submits that the petitioner failed to explain the delay in filing the return of income. She also points out that there was a delay of 927 days and that there is no infirmity in the impugned order.
5. The petitioner has placed on record the returns filed in respect of preceding assessment years commencing from 2015-16 to 2019-20. In the impugned order, such returns were construed as belated returns because such returns were filed within the extended time under Section 139(4) of the Act. As regards the ill health of the former Chartered Accountant of the petitioner, the explanation was considered as insufficient because the Chartered Accountant died on 07.11.2022, whereas the return was required to be filed on 15.02.2021. The petitioner has placed on record the medical certificate dated 13.03.2022, which indicates that the Chartered Accountant was under treatment between February and March 2022. This aspect was not taken into consideration in the impugned order. Another material consideration is that the petitioner does not seek any refund or exemption as is evident from the statement of income annexed to the petitioner's return of income. In fact, the petitioner has also computed interest up to the date of filing of the application under Section 119(2)(b) of the I-T-Act.
6. When the above facts and circumstances are considered cumulatively, the petitioner makes out a case to condone delay for genuine hardship. Consequently, the order impugned herein warrants interference.
7. Therefore, the impugned order dated 23.02.2024 is set aside and the delay in filing the return of income of the petitioner for assessment year 2020-21 is condoned. As a corollary, the respondents are directed to receive and process the petitioner's return of income subject to the petitioner paying interest and late filing fee in accordance with law. In order to facilitate the above, the respondents are directed to provide access to the portal so as to enable the petitioner to upload the return of income.
8. W.P.No.10127 of 2024 is disposed of on the above terms. There shall be no order as to costs. Consequently, connected miscellaneous petition is also closed.
17.04.2024 Index
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