In an important and far reaching judgment, Hon’ble Delhi High Court has refused to extend the due date of filing the Income Tax Returns as prescribed under Section 139(1) and furnishing Audit Reports under Section 44 AB of the Income Tax Act, to the extent of delay in number of days in notifying the prescribed Income Tax Forms. However the Court directed the Govt. to record the reasons for delay in notifying ITRs from next assessment year.
Earlier, Avinash Gupta, the petitioner had filed W.P.(C) No.8771/2015 which did not disclose any cause of action in favour of the petitioners and the petitioners had withdrawn the petition with liberty to file a Public Interest Litigation (PIL). Later, the petitioner had filed this WP (WP 9032/2015) pleading his own cause of action as a Chartered Accountant engaged by various clients to file returns as well as in his personal capacity, his own ITR being subject to audit.
WP(C) No. 9032/2015
Date of Decision: 21st September, 2015
Avinash Gupta (Petitioner) Vs Union of India & Ors (Respondents)
Coram: Justice Rajiv Sahai Endlaw
Main Observation of the High Court were as under:
There is no right of 180 days for filing of ITR
The period claimed by the petitioner as a matter of right of 180 days for filing the ITR is admittedly not prescribed, neither in the Statute nor in the Rules. According to the counsel for the petitioner also, the same has to be deduced from the scheme of the Act.
The time taken in audit determines the time available for filing the ITR
I am afraid, I am unable to gauge any such scheme in the Act assuring 180 days to the assessee for filing the ITR. As already observed above, filing of ITR for assesses due date wherefor is 180 days is dependent upon the accounts of the assessee being audited and which audit the counsel for the petitioner admits commences only on the beginning of assessment year. The said audit, in the case of some assesses may be completed in a few days and in case of others may take longer. Thus, the time taken in audit, which is variable, will be determinative of the time available thereafter for filing the ITR. The said audit is not dependent upon the prescription of the forms for report of the said audit and / or for filing of the ITR. Audit, as per my understanding is to be as per the Guidelines prescribed by the Institute of Chartered Accountants of India and the expectation, even if any for amendment to the form of the Audit Report and /or of the form for filing the ITR is not to interfere with the commencement or completion of the audit and which can by no stretch of imagination be said to be a small task.
Time available from 29-07-2015/07-08-2015 to 30-09-2015 was not small/short
Experience of life shows that the said audit itself takes the majority of the time, even if can be said to be prescribed of 180 days, for filing of the ITR. Once the audit is complete, in my opinion, the time admittedly available from 29th July, 2015 / 7th August, 2015 to 30th September, 2015 cannot be said to be so small / short which would qualify as unreasonable and in which the Chartered Accountants and the other practitioners of the field cannot be said to be having sufficient time to fill up the forms as per the audit already completed and to file the ITR.
It is not as if the Authorities have not applied themselves to the matter
The Authorities concerned, while have extended time for filing of the ITR from the due date of 31st July to 7th September, after having brought out the Notification dated 29th July, 2015 were of the opinion that there was no need for extension of due date of 30th September.
After 9th September also, sufficient time is available for filing the ITR.
It is also significant that the respondents, vide Press Release dated 9th September, 2015 have notified that the date of 30th September will not be extended and have advised the taxpayers to file the returns accordingly. It is thus not as if the respondents have kept the decision in this regard pending till the last date. After 9th September also, sufficient time is available for filing the ITR.
It is a policy matter
Such decisions of the Government, is a matter of policy and which the Government is best entitled to take and with which the Courts are not to interfere with except when either find the same to be infringing a vested right or causing undue prejudice to the persons effected thereby.
Time available, even after 07-08-2015 and till 30-09-2015 not illogical or unreasonable
The petitioner, has neither been able to make out any case of any time being prescribed to be made available to the assessee, after the form of audit report and ITR have been prescribed, for filing the ITR nor has been able to make out a case of the same causing any prejudice to himself. The time available, even say after 7th August, 2015 and till 30th September, 2015 is else not found by me to be illogical or unreasonable to enable the assessees to file the ITR.
Extending time on the ground the no prejudice would be caused not a ground for interfering with the policy decision of the Government
However the test to be applied in such matters is not of seeing whether the respondents would suffer any prejudice or not, without first being satisfied of the infringement of rights of the petitioner and/or prejudice being caused to the petitioner. If no right is infringed and no prejudice is found to be caused to the petitioner, merely because no prejudice would be caused to the respondents by extending the time for filing the ITR would not be a ground for interfering with the policy decision of the Government and granting such extension.
Executive decisions of the Govt unless shown to be causing any prejudice or infringing a right, are not to be interfered with under Article 226 of the Constitution of India.
Faced therewith, the counsel for the petitioner has made two other arguments. Firstly, it is contended that since the due date of 31st July was extended till 7th September, the practitioners of Income Tax remained busy till 7th September, 2015 in filing the returns of the assessees due date wherefor was 31st July and have been left with very little time for assessees due date wherefor is 30th September, 2015. Secondly, it is contended that such a representation has been made by the Institute of Chartered Accountants of India as well. The aforesaid, in my view, would not make any difference. As aforesaid, these decisions are in the executive domain and unless shown to be causing any prejudice or infringing a right, are not to be interfered with under Article 226 of the Constitution of India.
There is sufficient time available to the Government, after the Finance Act of the financial year, to finalise and notify ITRs immediately
Notwithstanding having held so, I am of the view that there is however some merit, if not legal then otherwise, in the grievance of the petitioner. The counsel for the respondents appearing on advance notice is unable to give the reasons for the forms etc. being not available at the beginning of the assessment year on 1st April of every year and the same thereby causing inconvenience to the practitioners of the subject. There is sufficient time available to the Government, after the Finance Act of the financial year, to finalise the forms and if no change is intended therein, to notify of the same immediately. There appears to be no justification for delay beyond the assessment year in prescribing the said forms.
From next assessment year reasons for delay in notifying ITRs to be recorded
Accordingly, though not granting any relief to the petitioner for the current assessment year, the respondents are directed to, with effect from the next assessment year, at least ensure that the forms etc. which are to be prescribed for the Audit Report and for filing the ITR are available as on 1st April of the assessment year unless there is a valid reason therefor and which should be recorded in writing by the respondents themselves, without waiting for any representations to be made. The respondents, while doing so, to also take a decision whether owing thereto any extension of the due date is required to be prescribed and accordingly notify the public.
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