Agnishanti Constructions Pvt Ltd (A Private Ltd. Company Holding v. Principal Commissioner And Income Tax Guwahati 1 And Three

GAHC010115372024 undefined THE GAUHATI HIGH COURT(HIGH COURT OF ASSAM, NAGALAND, MIZORAM AND ARUNACHAL PRADESH) Case No. : WP(C)/2996/2024 AGNISHANTI CONSTRUCTIONS PVT LTD (A PRIVATE LTD. COMPANY HOLDING PAN , HAVING ITS REGISTERED OFFICE AT GNB ROAD, AMBARI, GHY-1) (REPRESENTED BY ITS, DIRECTOR SRI KUNAL AGNIHOTRI, DIN. 00877959 VERSUS PRINCIPAL COMMISSIONER AND INCOME TAX GUWAHATI 1 AND THREE ORS ROOM NO. 705, AAYKAR BHAWAN, CHRISTIAN BASTI, G.S. ROAD, GUWAHATI-781005 2:ASSTT. DIRECTOR OF INCOME TAX CPC BENGALURU CENTRALIZED PROCESSING CENTRE INCOME TAX DEPARTMENT BENGALURU PIN-560500 3:DEPUTY DIRECTOR OF INCOME TAX CPC BENGALURU CENTRALIZED PROCESSING CENTRE INCOME TAX DEPARTMENT BENGALURU PIN-560500 4:CENTRAL BOARD OF DIRECT TAX HEADED BY THE CHAIRPERSON CBDT MINISTRY OF FINANCE DEPARTMENT OF REVENUE GOVT. OF INDIA HAVING ITS OFFICE AT NORTH BLOCK SECRETARIAT BUILDING NEW DELHI-0 Advocate for the Petitioner : MOHAMMAD KHAN, Advocate for the Respondent : SC, INCOME TAX, MR. S CHETIA BEFORE HONOURABLE MR. JUSTICE SOUMITRA SAIKIA ORDER 20.11.2024 Heard Mr. D. Khan, learned counsel for the petitioner. Also heard Mr. S.Chetia, learned Standing Counsel, Income Tax. 2. The petitioner before this Court is a private limited company engaged inconstructions of building and other infrastructural works and is an assessee ofIncome Tax under the Income Tax Act, 1961 and holding PAN forthe purposes. The petitioner filed Income Tax Return for the assessment year2020-21 on 31.03.2022 along with it had also filed Form No. 10-IC for exerciseof option under Sub-section (5) of Section 115BAA of the Act. Section 115 BAAwas introduced on September, 2019 to give additional benefits of the optionalreduced corporate tax to certain categories of domestic companies permittingthem to retain more profits in view of the competitive business environment.Under Section 115BAA, domestic companies have the option to pay tax at a rateof 22% plus applicable surcharges instead of 30% plus surcharges. Thisprovision is optional, however, if the company opt for it, it cannot withdrawsubsequently. To avail this offer, the assessee concerned has to file Form 10-IC once in a lifetime on or before the due date of filing the ITR for the concernedAssessment year namely AY 2020-21 in so far as the present proceedings areconcerned. The petitioner company opted for the scheme and filed its Returnsby paying the total self assessment tax amount of Rs. 44,95,515/- and leavingno further tax dues to be paid. No refund of tax or carry forward of losses wasclaimed by the petitioner for the said assessment year of 2021-22. 3. The respondent No. 2 by Notice dated 13.11.2022 received tax demand ofRs. 15,68,780/- plus interests on the petitioner resulting in the rejection of theoption under Section 115BAA opted by the assessee during filing the ITR for theAssessment Year 2021-22. 4. The petitioner on 09.02.2023 requested the Income Tax authoritiesthrough e-filing portal for rectification and reprocessing the ITR for AssessmentYear 2021-22 citing mistakes in the notice or intimation dated 13.11.2022 underSection 143(1). Thereafter on 24.02.2023 after due verification, the respondentNo. 3 issued an order under Section 154 of the Act raising additional tax uptoRs. 15,83,3980/- and thereby rejecting the Form 10-IC filed by the petitionerunder Section 115BAA. 5. It is the case projected by the petitioner that the CBDT under its circular 4. The petitioner on 09.02.2023 requested the Income Tax authoritiesthrough e-filing portal for rectification and reprocessing the ITR for AssessmentYear 2021-22 citing mistakes in the notice or intimation dated 13.11.2022 underSection 143(1). Thereafter on 24.02.2023 after due verification, the respondentNo. 3 issued an order under Section 154 of the Act raising additional tax uptoRs. 15,83,3980/- and thereby rejecting the Form 10-IC filed by the petitionerunder Section 115BAA. 5. It is the case projected by the petitioner that the CBDT under its circular No. 19/2023 dated 23[rd] October, 2023 had allowed general condonation of thedelay under Section 119(2)(b) of the Income Tax Act, 1961 by filing Form No.10-IC for Assessment Year 2021-22 by extending the deadline of file Form 10-ICtill 31.01.2024. The petitioner however inspite of his best efforts could not availthe advantage of the extended due date of 15.03.2022 and filed its returnswithin that extended period of time. The said returns were thereafter filed on31.03.2022 together with all taxes, interest and other charges are applicable. This delay occurred because of COVID-19 pandemic situation, the petitioner wasquarantine at his Noida residence for Covid related infections which causedgeneral hardship to the petitioner. 6. It is the case of the petitioner before this Court that this delay caused dueto willful and deliberate intention of the petitioner. This delay was because ofgenuine hardship caused due to medical related issue. Under suchcircumstances, the petitioner has approached this Court for a direction to therespondents more particularly CBDT to consider the case of the petitionerliberally under Section 119(2) of the Act and condone the delay of 16 days thathad occurred in filing the ITR for Assessment Year 2020-21 and also considerthe option exercised by the petitioner under Section 115BAA of the Act. 7. The petitioner has referred to a Judgment of the Telangana High Court inW.P.(C) No. 8272/2023. The learned counsel appearing for the petitionersubmits that a similar issue came up before the Telengana High Court and byJudgment and Order dated 18.01.2023, the Hon’ble High Court allowed thepetition directing the respondent authorities more particularly CBDT to considerthe case of the petitioner because of genuine hardship. He further refers to aJudgment of the Orissa High Court rendered in W.P(C) No. 38769/2023 (DilipKumar Barik Vs. The Income Tax Officer, Keonjhar & Ors) wherein the prayer forconsideration for the request of the petitioner is to condone the delay wasaccepted and orders accordingly were issued. The learned counsel for thepetitioner has also referred to a Judgment of the Bombay High Court renderedin Sitaldas K. Motwani Vs. Director General of Income Tax & Ors., reported in(2009) SCC Online 2195 to submits that words “genuine hardship” used inSection 119(2)(b) has to be construed liberally and refusal to condone the delayresulting in a matter where the merits require consideration but was not consider on the point limitation and thereby defeating the cause of justice at thevery threshold. 8. The learned Standing counsel for the Income Tax Department submits thatthe power to condone the delay under Section 119 is in respect of the scheme isonly reserved for the Central Board of Direct Taxes. The CBDT by its circulardated 23.10.2023 had issued a circular in respect of the cases where such delayin filing of Form 10-IC could be considered in cases where the return of incomehas been filed on or before the due date specified under Section 139(1) of theAct. He therefore submits that since admittedly the petition has been filed afterthe due date, the income tax authorities are not empowered to consider thedelay. 9. The learned counsel for the parties have been heard. The writ petitionalong with enclosures have been carefully perused. Judgments placed beforethe Court are also carefully perused. 9. The learned counsel for the parties have been heard. The writ petitionalong with enclosures have been carefully perused. Judgments placed beforethe Court are also carefully perused. 10. Under Section 119(2)(b), it is provided as under: “(b) the Board may, if it considers it desirable or expedient so to do for avoidinggenuine hardship in any case or class of cases, by general or special order,authorize to admit an applicant or claim for any exemption, deduction, refund orany other relief under this Act after the expiry of the period specified by or underthis Act for making such application or claim and deal with the same on merits inaccordance with law.” 11. The Telengana High Court by its Judgment and Order dated 18.01.2023passed in W.P.(C) No. 8272/2023 had the occasion to deal with a similar issueand the Court after consideration of the issues before it had allowed the writpetition directing the CBDT to consider the grievances of the petitionerthereafter passed appropriate orders. 12. The Orissa High Court in W.P.(C)No. 38769/2023 also expressed the sameopinion, wherein the High Court, upon considering the grievances raised by thepetitioner, allowed the writ petition and directed the CBDT to consider thematter in respect of the prayer of condonation of delay. 13. The Judgments of Telengana High Court and the Orissa High Court havebeen carefully perused. The facts in the present proceedings are similar. Theprovisions of Section 119 have also been carefully noted. 14. What transpires is that it is the CBDT which is vested with the power ofcondonation of delay in the event the Board considers it necessary to pass suchan order on the attending facts and circumstances of the case, where theauthority prescribed by the statute is given the discretion to consider thedifficulties faced by any assessee and thereupon pass an order, it will beimproper for the subordinate authorities to reject the same on the ground thatno power is prescribed on the said authorities. Where statute provides for theprovisions for condonation of delay by an appropriate authority upon dueconsideration of the relevant facts and circumstances, then any subordinateauthority under the authority prescribed before whom such an application isfiled is required to redirect the assessee to the authority prescribed under theAct who has been bestowed with the power of condonation of any delay upondue consideration of the facts and the materials. The authority which rejectedthe application filed by the petitioner was required to refer the matter to theCBDT as the power for consideration of condonation of delay was bestowed onlyon the CBDT under the statute and not on any other authority. 15. In the facts and circumstances of the case, this Court is persuaded toaccept the view rendered by the Telengana High Court and the Orissa HighCourt and is therefore of the considered view that the hardship on medical grounds which are urged before this Court cannot be disregarded without aproper finding on that issue by the authority concerned. Prima facie it appearsto the Court that the hardship suffered by the petitioner was for reasons beyondits control and for the medical conditions mentioned as the same occurredduring the COVID 19 pandemic situation. 16.Be that as it may, considering the submissions made by the petitioner andthe averments made in the writ petition and the Judgments referred by thepetitioner, this Court is of the view that the writ petition can be disposed of witha direction to the CBDT authorities to consider the claim of the petitioner forcondonation of the delay on the ground of hardship and thereafter passappropriate orders. The Commissioner of Income Tax is directed to place thenecessary records of the application filed by the petitioner before the CBDT andwhich in turn will pass necessary order thereon, as per the directions above. 16.Be that as it may, considering the submissions made by the petitioner andthe averments made in the writ petition and the Judgments referred by thepetitioner, this Court is of the view that the writ petition can be disposed of witha direction to the CBDT authorities to consider the claim of the petitioner forcondonation of the delay on the ground of hardship and thereafter passappropriate orders. The Commissioner of Income Tax is directed to place thenecessary records of the application filed by the petitioner before the CBDT andwhich in turn will pass necessary order thereon, as per the directions above. 17. The entire exercise be carried out as expeditiously as possible within theouter limit of 60 days from the date of receipt of certified copy of this order. 18. The writ petition stands disposed of in view of the above. JUDGE Comparing Assistant