Wa/15/2024 Of The Pr. Commissioner Of Income Tax v. Shri Vivek Krishnnamoorthy

Digitally signedby SHARADAVANI BLocation: HIGHCOURT OFKARNATAKA NC: 2025:KHC:427-DBWA No. 15 of 2024 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 8 DAY OF JANUARY, 2025 PRESENT THE HON'BLE MR JUSTICE KRISHNA S DIXIT AND THE HON'BLE MR JUSTICE G BASAVARAJA -WRIT APPEAL NO. 15 OF 2024 (TIT) BETWEEN: 1. THE PR. COMMISSIONER OF INCOME TAX BANGALORE - 3, C R BUILDING (CENTRAL REVENUE) NO. 1, QUEENS ROAD, BENGALURU 560 051. PRESENT ADDRESS THE PR. COMMISSIONER OF INCOME TAX 3, 5 FLOOR, BMTC BUILDING, 6 BLOCK, 80 FEET ROAD, KORMANGALA, BENGALURU 560 095. 5 FLOOR, BMTC BUILDING, 6 BLOCK, 80 FEET ROAD, KORMANGALA, BENGALURU 560 095. 2. THE INCOME TAX OFFICER, CIRCLE -5(3)(1), NO. 57, CIRCLE -5(3)(1), NO. 57, HMT BHAVAN, BELLARY ROAD, GANGANAGAR EXTENSION, GANGANAGAR EXTENSION, BENGALURU 560 032. PRESENT ADDRESS THE DEPUTY COMMISSIONER OF INCOME TAX CIRCLE 5(3)(2), 2 FLOOR, BMTC BUILDING, 6 BLOCK, CIRCLE 5(3)(2), 2 FLOOR, BMTC BUILDING, 6 BLOCK, 80 FEET ROAD, KORAMANGALA, BANGALORE 560 095. BANGALORE 560 095. …APPELLANTS (BY SRI. Y V RAVIRAJ., ADVOCATE & SRI. DILIP M.,ADVOCATE) AND: SHRI VIVEK KRISHNNAMOORTHY S/O S. KRISHNAMOORTHY, AGED ABOUT 45 YEARS, RESIDING AT A 303, ROHAN MIHIRA APARTMENT, AECS LAYOUT, CHINNAPPANAHALLI, BENGALURU – 560 037. …RESPONDENT THIS WRIT APPEAL FILED U/S 4 OF THE KARNATAKA HIGH COURT ACT PRAYING TO A) SET ASIDE THE ORDER PASSED BY THE LEARNED SINGLE JUDGE IN WP NO.16991/2023 DATED 02/11/2023 AND B)PASS SUCH OTHER SUITABLE ORDERS. THIS WRIT APPEAL, COMING ON FOR ORDERS THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER: CORAM: HON'BLE MR JUSTICE KRISHNA S DIXIT and HON'BLE MR JUSTICE G BASAVARAJA ORAL JUDGEMENT (PER: HON'BLE MR JUSTICE KRISHNA S DIXIT) This intra court appeal by the Revenue seeks to call in question a learned Single Judge’s order dated 02.11.2023 whereby, respondent-Assessee’s W.P.No.16991/2023 (T-IT) having been favoured, relief has been granted to him as under: “[a] The petition is allowed in part, and the first respondent’s impugned order dated 29.05.2023 in No. ITBA/COM/F/17/2023-24/1053267375(1) [Annexure-A] is quashed. The petitioner’s application for condonation of delay is restored for reconsideration in the light of this Court’s observation. [b] The first respondent shall consider the petitioner’s application as aforesaid within a period of one [1] month from the date of receipt of a certified copy of this order.” 2. Learned Sr. Panel Counsel appearing for the Revenue seeks to falter the impugned order contending that the learned Single Judge failed to appreciate the delayed filing of ITR for the Assessment Year 2013-14 and further, delayed filing of application for condoning the delay u/s 119(2)(b) of the Income Tax Act, 1961. He also falters the impugned order on the ground that the same runs counter to the CBDT Circular No.9/2015 dated 09.06.2015, which the authorities have followed while issuing the order dated 29.05.2023 declining refund. 3. Having heard the learned Panel Counsel for the Revenue and having perused the Appeal Papers, we decline indulgence in the matter broadly agreeing with the reasoning of the learned Single Judge on which the impugned judgement has been structured. The subject CBDT Circular prescribes a period of six years for filing the refund application and as the condonable limit of delay vide paragraph 3. One cannot ignore paragraph 6 of the Circular which provides for admission of belatedly filed application for refund. The same has not been duly adverted to by the Revenue while declining the claim for refund, although the same was belatedly filed, which aspect has been duly considered by the learned Single Judge. 4. Paragraphs 3 & 6 of the CBDT Circular have the following text: 3. Having heard the learned Panel Counsel for the Revenue and having perused the Appeal Papers, we decline indulgence in the matter broadly agreeing with the reasoning of the learned Single Judge on which the impugned judgement has been structured. The subject CBDT Circular prescribes a period of six years for filing the refund application and as the condonable limit of delay vide paragraph 3. One cannot ignore paragraph 6 of the Circular which provides for admission of belatedly filed application for refund. The same has not been duly adverted to by the Revenue while declining the claim for refund, although the same was belatedly filed, which aspect has been duly considered by the learned Single Judge. 4. Paragraphs 3 & 6 of the CBDT Circular have the following text: “3. No condonation application for claim of refund/loss shall be entertained beyond six years from the end of the assessment year for which such application/claim is made. This limit of six years shall be applicable to all authorities having powers to condone the delay as per the above prescribed monetary limits, including the Board. A condonation application should be disposed of within six months from the end of the month in which the application is received by the competent authority, as far as possible. 6. A belated application for supplementary claim of refund (claim of additional amount of refund after completion of assessment for the same year) can be admitted for condonation provided other conditions as referred above are fulfilled. The powers of acceptance/rejection within the monetary limits delegated to the Pr.CCsIT/CCsIT/Pr.CsIT/CsIT in case of returns claiming refund and supplementary claim of refund would be subject to the following further conditions: i. The income of the assessce is not assessable in the hands of any other person under any of the provisions of the Act. ii. No interest will be admissible on belated claim of refunds. iii. The refund has arisen as a result of excess tax deducted/collected at source and/or excess advance tax payment and/or excess payment of self-assessment tax as per the provisions of the Act.” One thing to be noted is that a request was made for refund in the very ITR itself that had remained unconsidered. Subsequently, a formal application has also been made. In such a case, what is to be seen is the claim for refund, regardless of the form in which it is put forth. In other words, when the request is made, that date has to be kept in mind for reckoning the delay and while considering its condonation. The subsequent date on which formal application is made thus pales into insignificance. 5. The Hon’ble Kerala High Court in K.C.ANTONNY v. PRINCIPAL COMMISSIONER OF INCOME-TAX, (2023) 148 TAXMANN.COM 28 (KERALA) has observed at paragraph Nos.5 & 6 has observed as under: “5. Having heard the learned counsel appearing for the petitioner and the learned counsel appearing for the respondent-Department, I am of the view that the petitioner is entitled to succeed. The assessment year in question in this case is 2010-11. It is not in dispute that the petitioner had filed his return of income for the said assessment year on July 13, 2012. The provisions of section 119(2)(b) of the Act read as under : “(b) the Board may, if it considers it desirable or expedient so to do for avoiding genuine hardship in any case or class of cases, by general or special order, authorise any Income-tax authority, not being a Commissioner (Appeals) to admit an application or claim for any exemption, deduction, refund or any other relief under this Act after the expiry of the period specified by or under this Act for making such application or claim and deal with the same on merits in accordance with law ;” “(b) the Board may, if it considers it desirable or expedient so to do for avoiding genuine hardship in any case or class of cases, by general or special order, authorise any Income-tax authority, not being a Commissioner (Appeals) to admit an application or claim for any exemption, deduction, refund or any other relief under this Act after the expiry of the period specified by or under this Act for making such application or claim and deal with the same on merits in accordance with law ;” A careful reading of the aforesaid provision indicates that the delay, which can be condoned in exercise of the jurisdiction under the aforesaid section, is the delay in filing the application "for any exemption, deduction, refund or any other relief under this Act after the expiry of the period specified by or under this Act for making such application or claim and deal with the same on merits in accordance with law". The provision, therefore, is clear and unambiguous, in that the delay that is to be condoned is the delay in making the application. In the facts and circumstances of the present case, the petitioner claimed a refund for the assessment year 2010-11 by filing belated return of income beyond the period specified in section 139 of the Act, on July 13, 2012. Exhibit P6 proceeds on the basis that the application for condonation of delay ought to be rejected as "the application" was filed beyond the period of six years from the end of the relevant assessment year and, therefore, in terms of the circular of the Board bearing No. 9 of 2015, the application cannot be considered. 6. I am of the view that the 1st respondent completely misdirected himself in law while holding that Ext.P5 application of the petitioner for condonation of delay ought to be rejected as it was filed beyond the period specified in the Circular of the Board, referred to above. It cannot be disputed and it is clear from a reading of the provisions of Section 119(2)(b) that the delay to be condoned is the delay in making 'the application' for refund.'The application for refund', in this case is the return which was not processed as it was filed beyond the time specified in Section 139 of the Act. Therefore, the delay to be condoned was not to be considered with reference to the date on which the application under Section 119(2)(b) was filed, but with reference to the date on which the 'application for refund' (here in this case the return of income) was filed. Section 119(2)(b) does not impose any limitation for the purposes of filing an application for condonation of delay. Therefore, it was completely wrong on the part of the 1st respondent to treat the date of filing of application for condonation of delay as the relevant date for the purpose of considering whether it was filed within 6 years or not. The application for refund, by filing return of income, was admittedly made on 13.7.2012. Therefore, the delay in filing ought to be with reference to the last date for filing of return of income for the year 2010-11, till 13.7.2012. In this view of the matter, it is not necessary to consider the decisions cited at the bar by the learned counsel for the petitioner.Therefore, this writ petition is allowed and Ext.P6 is quashed. Ext.P5 application will stand restored to the file of the 1st respondent who will consider the matter afresh, and decide whether the delay from 31.3.2012 (the last date on which return could have been filed for Assessment Year 2010-11) till 13.7.2012 (date of filing of return by the petitioner) can be condoned in exercise of the power conferred under Section 119 (2)(b) of the Act. This shall be done within a period of one month from the date of receipt of a certified copy of this judgment. Needless to say that, if the delay is condoned, the return filed by the petitioner for the Assessment Year 2010-11 on 13.7.2012 shall be processed in accordance with law. In the facts of the present case and considering that after filing his return for the Assessment Year 2010-11, on 13.7.2012, the petitioner made his first request enquiry regarding the status of his application for refund (the return) only in the month of June 2020, I am of the view that if the delay from 1.4.2012 to 13.7.2012 (104 days) is condoned and the petitioner is found eligible for refund, the refund amount will not carry any interest u/s 244A of the Income Tax Act, 1961 as it is clear that the petitioner did not pursue his application for nearly eight years (on his own showing). However, the Department will pay such interest if the refund is not actually made within six weeks from the date the petitioner is found eligible for the same.” Even the above observations clothe the impugned judgment with impunity. In the above circumstances, this appeal fails. Registry to send a copy of this Judgement to the Respondent – Assessee by Speed Post, immediately. Sd/- (KRISHNA S DIXIT) JUDGE Bsv/cbc List No.: 1 Sl No.: 13 Sd/- (G BASAVARAJA) JUDGE