GURCHARAN SINGH BHATIA,DELHI vs. ACIT, CIRCLE- 46(1), DELHI

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘E’, NEW DELHI Before Sh. Raj Kumar Chauhan, Judicial Member & Sh. Brajesh Kumar Singh, Accountant Member ITA No. 7471/Del/2025 :Asstt. Year: 2015-16 Gurcharan Singh Bhatia, Vs ACIT, C-9, Westend Colony, Circle-46(1), New Delhi-110027 New Delhi-110002 (APPELLANT) (RESPONDENT) PAN No. AHNPB4697E Assessee by: Sh. K. Sampath, Adv. Revenue by : Sh. Ravi Kant Choudhary, Sr. DR Date of Hearing: 19.03.2026 Date of Pronouncement: 16.06.2026 ORDER Per Raj Kumar Chauhan, Judicial Member: The appeal of the assessee is directed against the order dated 30.10.2025 of ld. CIT(A)/Addl./JCIT(A)-4, Chennai passed u/s 250 of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) wherein dismissal order of rectification application u/s 154 seeking refund of the TDS amount was confirmed and the claim of refund of Rs.17,08,200/- on account of TDS deducted as income from house property was denied on the ground that assessee could not e-verified the Income Tax Return within stipulated period.

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“2.1 The assessee is an Individual. He continued to derive income from house property, business income from finance and interest on deposit. Return of income for assessment year 2015-16 under section 139(1) of IT Act 1961 was filed on 03/09/2015 vide Ack. no. 771174300030915 declaring Nil income. Refund of Rs. 17,08,200 was claimed on account of advance tax paid and TDS deducted out of rental income. The income declared in the return of income is as under: Statement of total inc ome Income from House Property Rs. 1,42,94,172 Less : Loss i) business loss of the year Rs. 1,22,99,484 ii) Unabsorbed depreciation of the year Rs. 59,136 Rs .1,23,58,620 (-) Rs.1,23,58,620 Gross Income + Rs. 19,35,552 Less : Brought forward loss of AY 2009-10 -Rs. 19,35,552 Net Taxable Income NIL Income tax due Nil Less : Advance tax Rs. 1,000 TDS Rs. 17,07,202 Refund due Rs. 17,08,202 2.2 The assessee could not e-verify the Acknowledgement receipt of return of income e-filed on 03.09.2015 within stipulated period of one month on account of being busy in looking after his father Late Shri Santokh Singh, aged 83 years, who was seriously ill and was: going to hospital time and again. Under these circumstances the assessee could not e-verify the acknowledgement receipt dated 03.09.2015 of return of income e-filed within stipulated period. Thereafter, the assessee had e-filed condonation request to CPC on 16.02.2018. It has accepted by the CPC by issuing E-verified Acknowledgement receipt of return of income filed on 03.09.2015 by Electronic verification code OZM734WZI generated through Aadhar OTP mode. The return of income filed under section 139(1) on 03.09.2015 has been treated being e-verified and is, therefore, a valid return of income. The return of income has not been processed under section 143(1) of IT Act. It has been left as it is. No refund due of Rs.17,08,202 was issued. 2.2 The assessee had filed applications so many times for issue of refund of Rs 17,08,202. No action on the same was taken. Thereafter the assessee had filed Grievance application on 12/02/2024 vide Ack. No. 16158243. The assessee had also filed an application under section 154 at ASK Counter on 20/02/2024 vide Ack. No. 41451235052 for issue of refund of Rs. 17,08,202. The ACIT, vide disposal of Grievance application and rectification application under section 154 on 30/04/2024, has rejected the request of issue of refund on the point the assessee did not e verify the acknowledgement receipt of return e-

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filed on 03/09/2015 within stipulated period of one month with CPC. The assessee had e-verified the acknowledgement receipt by apply for condonation request to CPC who had accepted the same and e-verified acknowledgement receipt on 16/02/2018 of e-filed of return on 03/09/2015. 2.3 The ACIT, Circle 46(1), New Delhi on 30/04/2024 has rejected the application u/s 154 for issue of refund. The said e verification of acknowledgement receipt of e- filed return dated 03/09/2/2015 on 16/02/2018 by CPC is on record with the ACIT at the time of rejection of refund application under section 154 of IT Act.” 3. Aggrieved by the refusal to refund of TDS amount and rejection of application u/s 154 of the Act vide order dated 30.04.2024, the assessee filed appeal before JCIT(A), Chennai who while rejecting the appeal has passed the following order contained in para 4 & 5 extracted below as under: “4. Decision: 4.1 Ground 1 to 5: The assessee had filed his ITR for AY 2015-16 on 03.09.2015 and had claimed a refund of Rs. 17,08,200/-. Though he had filed his ITR within due date, the assessee had not e-verified it within the due date but got it verified only on 16/02/2018 which is much beyond the due date of verification. A refund under the Income Tax Act, 1961 cannot be issued to an assessee who has not verified his Income Tax Return (ITR) within the prescribed time. Return verification is a statutory requirement, and failure to verify before the due date means that the ITR is invalid/unfiled, thus resulting in no legal assessment and therefore, it is ineligible for refund. As per, Section 143(1), Refunds can only be initiated after processing a valid, verified ITR. If the ITR is unverified, CPC cannot process the return or compute any refundable claim. The only option for the assessee is to Apply for condonation of delay in verification to the CPC or to the

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JAO under Section 119(2)(b) and if the approval of condonation is received, then the refund maybe released. JCIT(Appeals) does not have the authority to grant condonation of delay. Hence, the grounds of the assessee are dismissed. 4.2 Ground 6: The ground is general in nature. 5. Conclusion: In the end, the appeal is dismissed.” 4. Aggrieved by the impugned order, the assessee is in appeal before the Tribunal and has raised the following grounds of appeal: “On the facts and in the circumstances of the case and in law, the ld. NFAC/CIT(A) erred in upholding the action of the Assessing Officer in rejecting the assessee’s claim for refund. The above action being arbitrary, fallacious, unwarranted and opposed to principles of natural justice must be quashed with directions for appropriate relief.” 5. We have heard ld. AR and the ld. DR. Ld. AR at the very outset submitted that ld. JCIT(A) has passed the impugned order contrary to the law settled by various High Courts including the Hon’ble High Court of Karnataka in K. Nagesh Vs. ACIT (2015) 376 ITR 473 and also the judgment of Gujarat High Court in S. R. Koshti Vs. CIT (2005) 276 ITR 165. It is an admitted fact that the appellant has suffered deduction of tax at source of the house property income which is reflected in Form 26AS. It is further submitted that the assessee has filed the return on time but its e-verification was done belatedly.

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The delay in e-verification was due to reasonable and sufficient cause as his father was seriously ill and the assessee cannot be penalized for these technical lapse despite that Government/Revenue was obliged to render technical assistance to the assessee. It is further submitted that there is no provision in the Act which would permit the AO/CPC to deny the refund and the credit given for the TDS amount deducted as per mandate of section 199 of the Act. Lastly, it is submitted that the condonation application for late e-filing was moved before the CPC who has allowed the same and despite allowing condonation of delay by the CPC and acceptance of filing of the return u/s 139 of the Act, the said return was not processed u/s 143(1) and credit of TDS amount deducted at source was not given to the assessee wrongly. It is further argued that ld. JCIT(A) while confirming the order of the Assessing Officer has perpetuated the illegality done by the Revenue authority which has resulted into miscarriage of justice. It is therefore submitted that in the given fact and circumstances, the ground raised need to be allowed and appeal be allowed and the lawful tax paid by the assessee by way of TDS deduction need to be refunded because the Revenue cannot be permitted to unjust enrichment on technical grounds.

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assessment, based on an invalid return, the department, retaining the amount of tax paid on the basis of invalid return without there being any self-assessment/assessment made by the authority under the Act, would violate Article 265 of the Constitution of India”.

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