CBDT refusal to condone delay in filing return u/s 119(2)(b) cannot be contrary to decision of another IT authority

CBDT refusal to condone delay in filing return u/s 119(2)(b) cannot be contrary to the decision arrived at by another authority exercising analogous powers under the Income Tax Act.

ABCAUS Case Law Citation:
ABCAUS 2070 (2017) (09) HC

The Grievance:
The instant Writ Petition was filed under Article 226 of Constitution of India against the order of CBDT passed u/s 119(2)(b) rejecting the petition for condonation of delay in filing return of income.

Assessment Year :  1996-97

Brief Facts of the Case:
The petitioner’s had application filed under Section 119(2)(d) of the Income Tax Act, 1961 was rejected by the CBDT on the ground that the reasons given by the petitioner for belated filing of return was not a case of genuine hardship and not a fit case to condone the delay under Section 119 (2)(d) of the Act.

The petitioner had filed his returns for the assessment year 1996-97 and 1997-98 belatedly after two years than the time prescribed.

Therefore, in order to make the returns be accepted and processed, the petitioner’s filed an application for both the assessment years for condonation of delay in filing under Section 119(2)(b).

For the assessment year 1997-98, the delay was condoned by the Assessing Officer, the returns were processed and the petitioner was also granted a refund of Rs.17,076/-. However, with respect of the application filed for condonation of delay in filing the return for the assessment year 1996-97 which involved claim of Refund of Rs.1,63,190/- on account of the jurisdictional hierarchic, the matter travelled to CBDT.

The CBDT rejected the same by an order passed u/s 119(2)(b) which was challenged by the petitioner by filing a writ petition in the High Court .The High Court allowed the writ and the matter was remanded to the CBDT for fresh consideration with a direction to dispose of the same after affording an opportunity to the petitioner.

In terms of the above directions, the CBDT after reconsidering the case, again rejected the request for condonation of delay by the impugned  order.

Observations made by the High Court:
The High Court observed that CBDT did not even adverted to the fact that the petitioner belated return for the assessment year 1997-98 was accepted and the relief was granted.

The High Court opined that this being so, the return for Ay 1996-97 should also be equally acceptable under Section 119(2)(b). Merely because on account of jurisdiction hierarchic, another authority superior to the authority was to decide the matter of the year 1997-98, the such decision cannot be contrary to the decision arrived at by another authority exercising analogous powers under the Income Tax Act.

The High Court further observed that the petitioner was an individual assessee and was granted relief for the assessment year 1997-98. No prejudice would be caused if the same yardstick are made applicable for the assessment year 1996-97 also.

Held:
CBDT order was set aside, the Income Tax Officer (ITO) was directed to process the return for the assessment year 1996-97 in accordance with law