Searching Case Laws & Precedent on Legal Query.....!
Analysing the retrieved Case Laws
Scanned Judgements…!
Searching Case Laws & Precedent on Legal Query.....!
Analysing the retrieved Case Laws
Scanned Judgements…!
Condonation of delay for filing audit reports in Form 10B under the Income Tax Act is generally governed by Section 119(2)(b) of the Act, which empowers the Commissioner or CIT(E) to condone delays if sufficient cause is shown ["Laxmidhar Educational Trust vs Commissioner of Income Tax - Orissa"].
Several orders demonstrate that authorities have the discretion to condone delays beyond the prescribed due dates, especially when delays are caused by genuine reasons, oversight, or unavoidable circumstances ["ASSOCIATION FOR LUMINOUS AND INTENSIVE SOCIAL HEALTH AWARNESS RAYAGADA vs COMMISSIONER OF INCOME TAX TELANGANA - Orissa"], ["INDIAN INSTITUTE OF FOREIGN TRADE NEW DELHI vs DCIT CIRCLE- EXEMPT 1(1) NEW DELHI - Income Tax Appellate Tribunal"], ["Sri Paspo Educational and Charitable Trust vs The Commissioner of Income Tax (Exemptions) - Madras"], ["LATE NAMMALVAR REP. BY PADMA NAMMALVAR NANNILAM vs ITO WARD-1 TIRUVARUR - Income Tax Appellate Tribunal"].
Circular No.16 of 2024 (dated 18.11.2024) explicitly delegates powers to the CIT to exercise discretion in condoning delays in filing Form 10B, indicating a move towards a more lenient approach in appropriate cases ["ASSOCIATION FOR LUMINOUS AND INTENSIVE SOCIAL HEALTH AWARNESS RAYAGADA vs COMMISSIONER OF INCOME TAX TELANGANA - Orissa"].
The courts have reiterated that filing of audit reports in Form 10B is procedural and that substantial compliance, including late filing, can be condoned if justified by bonafide reasons or circumstances beyond control ["INDIAN INSTITUTE OF FOREIGN TRADE NEW DELHI vs DCIT CIRCLE- EXEMPT 1(1) NEW DELHI - Income Tax Appellate Tribunal"], ["VISHVA KALYAN FOUNDATION SURENDRANAGAR vs ITO WARD 2 EXEMPETION AHMEDABAD AHMEDAABD - Income Tax Appellate Tribunal"].
Many cases highlight that delays caused due to administrative oversight, communication gaps, or technical issues can be considered sufficient cause for condonation, provided the applicant submits proper justification ["ASSOCIATION FOR LUMINOUS AND INTENSIVE SOCIAL HEALTH AWARNESS RAYAGADA vs COMMISSIONER OF INCOME TAX TELANGANA - Orissa"], ["COSMOPOLITAN EDUCATION SOCIETY MUMBAI vs ACIT EXEMPTION CIRCLE -1 MUMBAI - Income Tax Appellate Tribunal"], ["Khandelwal Vaishya Samaj Charitable Trust vs Commissioner Of Income Tax (Exemptions) - Rajasthan"].
Orders often specify that the authorities should consider the facts and reasons presented, and if they find the cause genuine, they are empowered to condone the delay, thereby enabling the assessee to claim benefits under sections like 12A and 11 ["Laxmidhar Educational Trust vs Commissioner of Income Tax - Orissa"], ["SWAMY VIVEKANANDA RURAL WELFARE AND EDUCATIONAL T vs COMMISSIONER OF INCOME TAX (Exemptions) - Madras"], ["COSMOPOLITAN EDUCATION SOCIETY MUMBAI vs ACIT EXEMPTION CIRCLE -1 MUMBAI - Income Tax Appellate Tribunal"].
The principle established is that delay in filing audit reports should not automatically result in denial of exemption if the delay is minor, justified, or due to unavoidable circumstances, and the authorities are expected to exercise their discretion judiciously ["ASSOCIATION FOR LUMINOUS AND INTENSIVE SOCIAL HEALTH AWARNESS RAYAGADA vs COMMISSIONER OF INCOME TAX TELANGANA - Orissa"], ["VISHVA KALYAN FOUNDATION SURENDRANAGAR vs ITO WARD 2 EXEMPETION AHMEDABAD AHMEDAABD - Income Tax Appellate Tribunal"].
Analysis and Conclusion:The legal framework and judicial orders affirm that condonation of delay in filing audit reports under the Income Tax Act is permissible under Section 119(2)(b). Authorities have the discretion to condone delays caused by genuine reasons, administrative lapses, or unavoidable circumstances, especially when supported by proper justification. Circular No.16 of 2024 further clarifies the delegation of such powers, fostering a more flexible approach. Courts emphasize that procedural delays should not hinder substantive benefits if the delay is reasonable and justified, promoting fairness and equity in tax administration.
Filing tax audit reports on time is crucial for businesses and trusts under the Income Tax Act, 1961. But what happens when unavoidable circumstances cause a delay? The question of condonation of delay for filing audit report under the Income Tax Act arises frequently, especially with tight deadlines under Section 44AB or for charitable trusts via Form 10B. This post breaks down the legal landscape, judicial views, and real-world exceptions to help you navigate this complex area.
Note: This is general information based on precedents and not specific legal advice. Consult a tax professional for your situation.
Condonation refers to the authorities' discretion to overlook or excuse a delay in filing required documents, like tax audit reports. Under the Income Tax Act, timelines are strict—audit reports must typically be filed one month before the return due date. However, courts have clarified that such condonation is generally not permissible unless explicitly provided by law or supported by specific statutory provisions or judicial exceptionsCommissioner of Income Tax, New Delhi VS Ram Kishan Dass - 2019 0 Supreme(SC) 362.
Procedural provisions do not inherently allow condoning delays; any power must be expressly conferred Commissioner of Income Tax, New Delhi VS Ram Kishan Dass - 2019 0 Supreme(SC) 362. The burden lies on the applicant to show sufficient cause, which must be bona fide and free from negligence Commissioner of Income Tax, New Delhi VS Ram Kishan Dass - 2019 0 Supreme(SC) 362.
The Income Tax Act, 1961, prescribes time limits but does not explicitly provide for condonation of delay in filing audit reportsCommissioner of Income Tax, New Delhi VS Ram Kishan Dass - 2019 0 Supreme(SC) 362. Section 142(2C) allows extensions within limits but not post-deadline condonation Commissioner of Income Tax, New Delhi VS Ram Kishan Dass - 2019 0 Supreme(SC) 362.
Courts emphasize strict construction of procedural laws. For instance, in analogous tax laws like the Central Excise Act, 1944, no condonation power exists for certain filings Commnr. of Customs, Central Excise, Noida VS M/s. Punjab Fibres Ltd. , Noida - 2008 2 Supreme 11. Similarly, under the Maharashtra Value Added Tax Act, 2002, Section 5 of the Limitation Act, 1963, is excluded, barring condonation Viraj Profiles Ltd. VS Addl Commissioner Of Sales Tax, Mumbai - 2018 0 Supreme(SC) 1592.
In Income Tax contexts, delays in revised returns or audit submissions are typically not overlooked without explicit provisions Dalmia Power Limited VS Assistant Commissioner of Income Tax Circle 1, Trichy - 2019 0 Supreme(SC) 1387.
Courts consistently uphold timelines. The Supreme Court and High Courts have ruled that procedural delays, including those related to audit reports, cannot be condoned unless statutory provisions or specific rules permit itCommissioner of Income Tax, New Delhi VS Ram Kishan Dass - 2019 0 Supreme(SC) 362.
For example:- In assessment-related filings, courts refuse condonation where law mandates timely submission Commissioner of Income Tax, New Delhi VS Ram Kishan Dass - 2019 0 Supreme(SC) 362.- The phrase 'sufficient cause' is interpreted contextually but requires proof of genuine reasons Commissioner of Income Tax, New Delhi VS Ram Kishan Dass - 2019 0 Supreme(SC) 362.
While the rule is strict, exceptions exist under Section 119(2)(b), which empowers the CBDT or authorities to condone delays for genuine hardship, especially for exemptions under Sections 11, 12, or 12A(1)(b).
Several High Court rulings show leniency for trusts:- In one case, a public charitable trust's delay in e-filing Form 10B was condoned despite technical rejection. The court noted the assessee's 30-year compliance history and held that 'an assessee, which is a public charitable trust... should not be denied exemption merely on bar of limitation especially when legislature has conferred wide discretionary powers'Social Security Scheme of GICEA VS Commissioner of Income Tax (Exemptions), Ahmedabad - 2022 Supreme(Guj) 1594. The impugned order was quashed, and condonation allowed.- Another trust faced delay due to the Chartered Accountant's illness and death. The court quashed the rejection, ruling it a 'pedantic approach' and recognizing genuine hardshipVisha Oswal Tap. Shantibhuvan Upashray And Derasar-Jamnagar VS Commissioner Of Income Tax (Exemptions) - 2024 Supreme(Guj) 1582.- For a 34-day delay in Form 10B, citing accountant's illness and communication gaps, courts advocated a 'liberal interpretation of 'genuine hardship'' for trusts with compliance history Shri 108 Parshwanath Bhakti Vihar Jain Trust VS Commissioner of Income Tax (EXEM) or His Successor - 2024 Supreme(Guj) 1553.
These cases illustrate that judicial discretion may permit leniency in exceptional circumstances like bona fide reasons, no prejudice to revenue, or trust exemptions Commnr. of Customs, Central Excise, Noida VS M/s. Punjab Fibres Ltd. , Noida - 2008 2 Supreme 11.
To succeed in condonation:- Prove genuine hardship: Illness, technical glitches, or external factors (e.g., auditor issues) Social Security Scheme of GICEA VS Commissioner of Income Tax (Exemptions), Ahmedabad - 2022 Supreme(Guj) 1594.- Show compliance history: Long-standing filers get equitable treatment Shri 108 Parshwanath Bhakti Vihar Jain Trust VS Commissioner of Income Tax (EXEM) or His Successor - 2024 Supreme(Guj) 1553.- No prejudice to Department: Reports filed before assessment Chavakkad Service Co-Operative Bank Ltd. VS Income Tax Officer - 2024 Supreme(Ker) 1206.- File under Section 119(2)(b): Invoke for exemptions or audits Social Security Scheme of GICEA VS Commissioner of Income Tax (Exemptions), Ahmedabad - 2022 Supreme(Guj) 1594.
However, negligence or lack of effort leads to rejection Commissioner of Income Tax, New Delhi VS Ram Kishan Dass - 2019 0 Supreme(SC) 362.
Authorities should grant condonation only with explicit authority to preserve integrity Commissioner of Income Tax, New Delhi VS Ram Kishan Dass - 2019 0 Supreme(SC) 362.
Condonation of delay for filing audit reports under the Income Tax Act is generally not permissible without statutory backing or proven sufficient cause Commissioner of Income Tax, New Delhi VS Ram Kishan Dass - 2019 0 Supreme(SC) 362. Strict timelines prevail, but Section 119(2)(b) offers hope for genuine cases, particularly trusts and error-induced delays.
Key Takeaways:- No blanket condonation; prove sufficient causeCommissioner of Income Tax, New Delhi VS Ram Kishan Dass - 2019 0 Supreme(SC) 362.- Trusts often succeed via equitable discretion Social Security Scheme of GICEA VS Commissioner of Income Tax (Exemptions), Ahmedabad - 2022 Supreme(Guj) 1594.- Document everything and act promptly.- Courts balance technicality with justice, but negligence is fatal.
Stay compliant to avoid disputes. For tailored guidance, reach out to a tax expert.
References:- Commissioner of Income Tax, New Delhi VS Ram Kishan Dass - 2019 0 Supreme(SC) 362, Commnr. of Customs, Central Excise, Noida VS M/s. Punjab Fibres Ltd. , Noida - 2008 2 Supreme 11, Viraj Profiles Ltd. VS Addl Commissioner Of Sales Tax, Mumbai - 2018 0 Supreme(SC) 1592, Dalmia Power Limited VS Assistant Commissioner of Income Tax Circle 1, Trichy - 2019 0 Supreme(SC) 1387, Social Security Scheme of GICEA VS Commissioner of Income Tax (Exemptions), Ahmedabad - 2022 Supreme(Guj) 1594, P. Kavin And Company vs Principal Commissioner Of Income Tax-1, Surat - 2025 Supreme(Guj) 1336, Visha Oswal Tap. Shantibhuvan Upashray And Derasar-Jamnagar VS Commissioner Of Income Tax (Exemptions) - 2024 Supreme(Guj) 1582, Shri 108 Parshwanath Bhakti Vihar Jain Trust VS Commissioner of Income Tax (EXEM) or His Successor - 2024 Supreme(Guj) 1553, Chavakkad Service Co-Operative Bank Ltd. VS Income Tax Officer - 2024 Supreme(Ker) 1206, REGEN Powertech Private Ltd. VS Central Board of Direct Taxes, Rep by its Chairperson, New Delhi - 2018 Supreme(Mad) 401
#TaxAuditDelay, #IncomeTaxAct, #CondonationOfDelay
Section 12A of the Income Tax Act and in consequence thereof, the Commissioner of Income Tax (Exemptions)-opposite partyNo.1 is directed to grant all consequential relief to the petitioner by taking into account the Audit Report in Form 10B pertaining to the Assessment Year 2021-22
Challenging the order dated 15.07.2025 (Annexure-1) rejecting the petition for condonation of delay filed under Section 119(2)(b) of the Income Tax Act, 1961 for filing the audit report in Form 10B prescribed under Rule 17B of the Income Tax Rules, 1962 (for short, “IT Rules”) ... Dalai, learned counsel for the Petitioner submitted that despite sufficient cause being shown, the Opposite Party No.1 has rejected the ....
CIT(E) vide his order dated 18.12.2025 u/s 119(2)(b) of the Act, has condoned the delay in filing the Audit Report in Form 10B u/s 119(2)(b) of the Act. ... As per application, the assessee is registered u/s 12A of the Income Tax Act, 1961. The applicant filed its Audit report in Form 10B on 01.11.2023 beyond 01 days' delay as due date was on 31.10.2023. ... Accordingly, the #HL_....
The petitioner filed an application u/s.119(2)(b) of the Act seeking condonation of delay in filing audit report in Form No.10B. ... This petition is filed challenging the order dated 12.3.2021,passed by respondent under Section 119(2)(b) of Income Tax Act, 1961 (“The Act” for short), wherein application of the assessee to condone the delay in e-filing the audit....
The petitioner is a partnership firm and obtained Tax Audit Report for the year under consideration under Section 44AB of the INCOME TAX ACT , 1961 (for short ‘the Act’) on 25.09.2018 which was duly uploaded on the Income Tax portal on the 25.09.2018 and the petitioner filed return of income ... of Rs.45,227/-(i.e. first item of column 20b of the Tax Audit Report#HL_EN....
of delay in filing Form 10BB under Section 119(2)(b) of the Income Tax Act, 1961, as required under Section 12A(b)(ii) of the Act, has been rejected. ... petition for the delay in filing Audit Report for the AYs 2016-17,2018-20, 2022-23 and 2023-24 with CIT(E), Chennai on 13.02.2024. ... of upto 365 days in filing Form No.10BB for the AY 2018-19 or for any subsequent AYs, the Commissioners of #HL_....
By this petition under Article 227 of the Constitution of India, the petitioner has challenged the order dated 09.09.2019 passed by the respondent-Commissioner of Income Tax (Exemption) under Section 119(2)(b) of the Income Tax Act, 1961 (for short ‘the Act’) whereby, the application for condonation ... It is submitted that the assessee then filed application u/s 119(2)(b), seeking condonation of delay in filing #H....
Pursuant to the said realization, the petitioner submitted the said audit report in Form-10B along with an application on 09.02.2024 invoking Section 119(2)(b) of the I.T. Act seeking condonation of delay in submitting the said audit report. ... ii) Issue a writ of mandamus or a direction in the nature of writ of mandamus directing the Respondent No.1 to condone the delay in filing of audit report#HL_END....
It was pointed out that professional preparing the audit report in Form 10B and preparing computation of income tax returns were at different places resulting into communication gap and the return was filed earlier to the filing of Form 10B. 23. Learned advocate Mr. ... By this petition under Article 227 of the Constitution of India, the petitioner has prayed for quashing and setting aside the order dated 21.12.2021 passed under section 119(2)(b) of Income Tax #HL_STA....
No.ITBA/COM/F/17/2025-26/1080403353(1) dated 08.09.2025 in PAN- AAATL5028R for the Assessment Year (‘AY’) 2020-21 and quash the same and direct the Respondent to condone the delay in filing Form 10B under Section 12A(1)(b) of the Income Tax Act, 1961 read with Rule 17B of the Income Tax Rules, 1962. ... Consequently, the petitioner was required to file the audit report in Form No.10B under Section 44AB at least one month prior there....
The court ruled that reasonable cause for delay in filing audit reports negates the imposition of penalties under the Income Tax Act, especially when no prejudice is caused to the Department. 2. The appellants/assessees are Co-operative Societies who had filed returns of income for the purposes of assessment under the Income Tax Act [hereinafter referred to as the “I.T. Act”]. In breach of the provisions of Section 44AB of the I.T. Act, however, they did not file the audit report as mandated under the said provision within the time limit specified there under. However, the ....
The learned Joint Charity Commissioner inter linked the two charges i.e. Charge Number 3 and 4. The learned Joint Commissioner Commissioner held that filing application Exh.62 for condonation of delay for filing audit report till 2012 vide Exh.61 itself shows that there is delay. Charge No.4 is in respect of fine of Rs.1,00,000/- imposed by the Deputy Director of Education against Trust and thereby committed acts of ‘malfeasance’ and ‘misfeasance’. The third charge is in respect of non submission of audited reports in the office of the Deputy Charity Commissioner and failur....
The Managing Director of the appellant company along with his wife are engaged in the business of purchase and sale of dates, oats and honey as also manufacture of syrups, jams and squash under the brand -Lion dates-. According to the appellant, they are regularly filing the returns of income along with tax audit report as required under Section 44AB of the Income Tax Act, 1961 (in short, “the Act”). At the time of search, two sworn statements were recorded under Section 132 of the Act by two different officers of the investigation wing.
Further vide notification S.O. 4805 (E) dated 31st December, 2020 the above due dates were further extended to 15th February, 2021 and 10th January, 2021 respectively. 3. As per the provisions of the Act the due date for filing of the audit report under section 44AB is one month prior to the due date of filing of income tax return. Therefore, the said due date was extended to 31st October, 2020 vide the Taxation and Other laws (Relaxation and Amendment of Certain Provisions) Act, 2020, 31st December, 2020 vide notification s.o. 3906(E) dated 29th October, 2020 and further t....
Thereafter, after getting NOC from the erstwhile Auditor, the petitioner uploaded the Return of Income along with the Tax Audit Report on 07.01.2015, hence, there was a delay of 37 days in filing the Return Of Income. 8. It is pertinent to note that the petitioner cannot appoint an alternative Auditor without getting the written letter/NOC from the existing Auditor. By delaying the submission of the Return of Income, the petitioner did not stand to benefit in any manner whatsoever.
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