There is a difference between CBDT or its authorised member making an order u/s 119(2)(b) and some other officers making an order with the approval, even of the member of the CBDT.
In a recent judgment, Hon’ble Bombay High Court while quashing the order passed u/s 119(2)(b) by the Additional CIT denying the condonation for delay in filing return of income held that there is a difference between the CBDT or its (OSD). There is a difference between the CBDT or its authorised member making an order and some other officers making an order with the approval, even of the member of the CBDT.
ABCAUS Case Law Citation:
4431 (2025) (02) abcaus.in HC
In the instant case, the Petitioner/assessee had filed a Writ Petition challenging the order passed u/s 119(2)(b) of the Income Tax Act, 1961 (the Act) by the Additional Commissioner of Income Tax (CIT) (OSD) (OT & WT) dismissing the Petitioner’s application for condonation of a delay in filing the return of income for the relevant Assessment Year.
The Petitioner submitted that the impugned order had been made by the Additional Commissioner of Income Tax (CIT) (OSD) (OT & WT) “with the approval of competent authority”. It was submitted the power to consider and dispose of an application for condonation of delay is vested in the Central Board of Direct Taxes (CBDT) under the provisions of Section 119(2)(b) of the Act and the impugned order was neither by CBDT nor any of its members.
It was submitted that there was no clarity about which competent authority had approved the making of the order. In any event, even if the CBDT or its members approve the order, it cannot be regarded as an order made by the CBDT or its members. It cannot be regarded as an order made by the CBDT or its members. On this short ground, the impugned order was liable to be set aside. In support of his contentions, the Petitioner relied upon number of judgments.
On the other hand, the Revenue defended the impugned order and referred to the Central Secretariat Manual for Office Procedure and stresses paragraph 9.3, which deals with the authentication of Government orders. Reference was also made to the Central Boards of Revenue Act, 1963, to justify making the impugned order by the Additional CIT (OSD) (OT & WT). It was submitted that the Petitioner was found to be a habitual defaulter when it comes to filing the return. For all these reasons, the petition may be dismissed.
The Hon’ble High Court observed that the impugned order had been signed by the Additional CIT (OSD) (OT & WT). The last line stated that it was passed “with the approval of competent authority. However, It did not throw much light on the status of competent authority approving the making of this order by the Additional CIT (OSD) (OT & WT).
The Hon’ble High Court observed that it had to interfere with similar orders made by officers who neither had any authorisation from the CBDT to make such orders nor any authorisation authorisation from the CBDT to make such orders nor any authorisation from CBDT members. This was assuming that the CBDT or its members could have delegated such powers to the officers like Additional CIT (OSD) (OT & WT).
The Hon’ble High Court pointed out that there is a difference between the CBDT or its (OSD) (OT & WT). There is a difference between the CBDT or its authorised member making an order and some other officers making an order with the approval, even of the member of the CBDT.
The Hon’ble High Court observed that in one similar case, an affidavit was filed on behalf of the Commissioner of Income Tax (Exemptions), in which an order similar to that made in this petition was sought to be justified contending that CBDT functions through its Members and the work allocation has been done amongst the Members. All the Members of the CBDT are the Special Secretaries to the Govt. of India and have office for processing all the matters to the Govt. of India and have office for processing all the matters dealt by them. Applications/petitions u/s 119(2)(b) of the Income dealt by them. Applications/petitions u/s 119(2)(b) of the Act received in the Board are processed in the office of the concerned Member after proper consideration of facts and circumstances of each case. The work relating to the Order under under section 119 of the Act on matters related to Sections 10, 11, 12 & 13 have been assigned to Member (IT) in CBDT. The orders in these cases are approved by Member concerned and after approval; these orders are issued with the signature of the officer, who is not below the rank of Under Secretary to Govt. of India, in the office of the Member Secretary to Govt. of India, in the office of the Member. Considering the extant office procedure and practices being followed, the Addl. CIT (ITA Cell) had signed the order after taking approval of the Member concerned. In last para of the Order, it has been clearly mentioned that the Order issues with the approval of Member (IT), CBDT.
However, the High Court had dismissed the above explanation observing that in the affidavit there was a specific statement that the work relating to orders under Section 119 of the Act on matters pertaining to Sections 10, 11, 12 and 13 have been assigned to Member (IT) in the CBDT.
The Hon’ble High Court further noted that in a similar situation, justification for a similar order was not accepted by another Division Bench observing that the last sentence in the impugned order stated that the order was passed with the approval of the Member (TPS & Systems), CBDT, however, there was nothing to indicate that Board had considered petitioner’s application.
The Hon’ble High Court further observed that Paragraph 9.3 of the Central Secretariat Manual of Office Procedure only relates to authentication of Government orders. This paragraph does not dispense with the requirement of CBDT or its members making orders on the application seeking condonation of delay. Section 119(2)(b) empowers the CBDT to decide such applications. The CBDT, as a part of its functioning, may have allocated applications. The CBDT, as a part of its functioning, may have allocated the work amongst its members. However, nothing was shown regarding any further allocation or delegation to the Additional CIT (OSD) (OT & WT). Similarly, there was the permissibility of any such further delegation. Similarly, there was nothing in the Central Boards of Revenue Act, 1963 or at least was brought upon which the making of the order by the Additional CIT (OSD) (OT & WT) could be held as valid or validated.
Therefore, following the previously decided cases, the Hon’ble High Court quashed and set aside the impugned order and remanded the matter to the CBDT or its duly allocated member to pass an order on the Petitioner’s application for condonation of delay.
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