C.G.VENKETESWARA PAI V. THE COMMISSIONER OF INCOME TAX

WP(C)/38055/2010

AI Insights

The case involves C.G. Venketeswara Pai, the petitioner, who faced issues with the acceptance of his income tax returns for the assessment years 2002-03 and 2003-04 due to delays in obtaining TDS certificates. The returns were initially submitted but were not accepted by the Income Tax Officer, leading to the filing of a writ petition. The High Court had previously directed the first respondent to consider the petitioner's applications for condonation of delay under Section 119(2)(b) of the Income Tax Act. However, the first respondent could only condone delays up to six years, as per the CBDT's circular, leading to the rejection of the application for the year 2002-03. The court found that the petitioner had made an attempt to submit the return earlier, as evidenced by the affixure of the 'office seal' and 'receipt number', albeit later scored off. The court decided to refer the matter to the CBDT for a decision on the merits.

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 761402 (HC-KERALA)
• Appeal Type: Others
• Pronouncement Date: 23-03-2011
• Assessment Year: misc
• Laws Referred To: Income Tax Act
• Result in Favour of: Partly Allowed
• Court: HIGH COURT
• Department Lawyers: JOSE JOSEPH
• Assessee Lawyers: TOMSON EMMANUEL
• Keywords: CBDT; Condonation of delay; Income Tax Return; TDS Certificates
• Section: 119(2)(b)

Judgement Text

"IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.K.ABDUL REHIM WEDNESDAY, THE 23RD MARCH 2011 / 2ND CHAITHRA 1933 WP(C).No. 38055 of 2010(F) -------------------- PETITIONER : -------------------- C.G.VENKETESWARA PAI, NEW DHANYA LOTTERY AGENCY, PARAMARA ROAD, ERNAKULAM, COCHIN-682 018. BY ADV. SRI.TOMSON T.EMMANUEL RESPONDENT(S): ------------------------- 1. THE COMMISSIONER OF INCOME TAX, IST FLOOR, REVENUE BUILDING, I.S.PRESS ROAD, COCHIN-682 018. 2. THE INCOME TAX OFFICER, WARD 2(1) RANGE 2, REVENUE BUILDING, I.S.PRESS ROAD, COCHIN-682 018. R1 & R2 BY ADV. SRI. JOSE JOSEPH, SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 23/03/2011, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: Mn C.K.ABDUL REHIM, J. ------------------------------------------- W.P.(C).No.38055 of 2010 ------------------------------------------- Dated this the 23rd day of March, 2011 J U D G M E N T ---------------------- Subject matter involved in this writ petition pertains to filing of Income Tax return by the petitioner, with respect to the assessment years 2002-03 and 2003-04. Since there occurred delay in filing the returns due to delay caused in getting the required TDS certificates, the petitioner had approached the 1st respondent under Section 119(2)(b) of the Income Tax Act, seeking condonation of delay. According to the petitioner, he had in fact submitted the returns earlier, in the office of the 2nd respondent as evidenced from Ext.P2 and P3, along with the TDS certificates. It is the case of the petitioner that the staff in the office of the 2nd respondent has not accepted those returns since they were filed beyond time. It is stated that, the returns in question were refused only after affixing 'office seal' of the 2nd respondent, which was thereafter scored off. In Ext.P2, copy of the return, it is evident that the 'office seal' was seen affixed and scored off. It is also pointed out that the “acknowledgment receipt number” was also affixed at the bottom of Ext.P2 and subsequently scored off. Under such circumstances, aggrieved by the non-acceptance of the returns the petitioner had approached this court on an earlier occasion. W.P.(C).38055/10 -2- In Ext.P5 judgment this court observed that, even assuming that Ext.P2 and P3 returns were filed on an earlier date as contended, there is delay in filing the returns. Therefore the 1st respondent was directed to consider and dispose of the applications filed under Section 119(2)(b). 2. Ext.P7 is the order issued by the 1st respondent after considering the application filed under Section 119(2)(b). In Ext.P7 the 1st respondent observed that, he has power to condone the delay in filing returns only upto a period of six years computed from the end of the assessment year concerned, and since the returns were filed beyond that period, the delay could not be condoned. 3. In Ext.P7 it was observed that, the affixure of the seal and receipt number in acknowledgment of receipt of the return for the year 2002-03, could not be reckoned since those endorsements were seen struck off. It was further observed that there was no acknowledgment of the return by putting signature of the official who was in charge of receiving the returns. However it was observed that, there was no such seal affixed with respect to the return filed for the year 2003-04 (Ext.P3). The 1st respondent relied on a report of the assessing officer to the effect that the return for the assessment years were not seen filed in the office. The 1st respondent observed that the power to W.P.(C).38055/10 -3- condone delay under Section 119(2)(b) is vested with the Central Board of Direct Taxes (CBDT) and it is only by virtue of Circular No.13/2006 dt.22.12.2006, the power is delegated to the 1st respondent. Referring to paragraph No.4 of the said circular it was stated that the power delegated to the 1st respondent is limited only for condonation of delay upto a period of 6 years from the end of the assessment year. 4. It is submitted by learned counsel for the petitioner that, inspite of Ext.P7 order, the delay with respect to the year 2003-04 was subsequently condoned, since it was found that the application was within a period of six years. Accordingly the return filed for the said year was accepted and the same is under process. Hence the petitioner is limiting his grievance against Ext.P7, only to the extent of the rejection to condone delay with respect to the assessment year 2002-03. 5. Heard, standing counsel appearing for the respondents. It is specifically pointed out that as per the circular issued by the CBDT, the power for condonation of delay is delegated to the 1st respondent with a limitation prescribed to the extent of condonding delay upto 6 years from the end of of the assessment year. Hence the 1st respondent is perfectly justified in not condoning the delay with respect to the year 2002-03, since the same is beyond the extent of his powers. On W.P.(C).38055/10 -4- the other hand, learned counsel for petitioner points out various decisions to the effect that the circulars issued by the authorities are not binding on the court. Considering the factual aspect involved it is only just and proper in the interest of justice to condone the delay in filing the return, is the contention. 6. It is evident that the 1st respondent has not gone into merits of the reasons explained for causing the delay in filing the return. But the application was rejected only on the basis that he is lacking power to condone the delay beyond the period of 6 years. I take note of the fact that, Ext.P2 contains affixure of the 'office seal' as well as 'receipt number'. However, it is evident that those endorsements were scored off. Even though it could not be said that the return in question was accepted at the office of the 2nd respondent, the above said endorsements will reveal that there was an attempt made by the petitioner to submit the return on an earlier occasion. According to me, the above said fact is a matter which need be considered while deciding the issue regarding condonation of delay. Of course, as observed in Ext.P5 Judgment, even computed on that basis, there is delay in filing the return. However, there was no evaluation done with respect to the above said aspects since the 1st respondent was lacking powers. It is the CBDT which is the competent authority to look into these matters and to take an appropriate decision, W.P.(C).38055/10 -5- bearing in mind all the above said aspects. Under such circumstances I am of the view that interest of justice will be served if the petitioner is relegated to the CBDT to seek appropriate relief. 7. Therefore the writ petition is disposed of directing the petitioner to approach the CBDT seeking condonation of delay in filing return, with respect to the assessment year 2002-03. If any such petition is filed within a period of two weeks from the date of receipt of a copy of such application, the same shall be considered by the CBDT on merits and an appropriate decision shall be taken thereof, after affording a reasonable opportunity of hearing, at the earliest possible, at any rate, within 3 months from the date of receipt of such application. 8. Learned counsel for the petitioner makes a further request to direct the 2nd respondent to dispose of the return filed with respect to the period 2003-04, within a time frame. Needless to say that the said authority will take appropriate steps for disposal of the matter at the earliest possible. C.K.ABDUL REHIM, JUDGE. okb "