ASHANK CLOUDS PRIVATE LIMITED vs. PRINCIPAL COMMISSIONER OF INCOME TAX

Facts

The petitioner, Ashank Clouds Private Limited, filed a writ petition challenging an order dated November 19, 2025, passed by the Principal Commissioner of Income Tax (PCIT), Jaipur-2. The PCIT had refused to condone the delay in filing the Income Tax Return (ITR) for the assessment year 2022-2023. The petitioner sought condonation of delay, citing ignorance about the requirement to file an ITR and the implications of TDS deduction. The PCIT, after obtaining a report, concluded that the delay was due to ignorance of law, not genuine hardship, and rejected the application. The petitioner argued that their reasons were genuine and not considered properly, and the rejection was mechanical. The respondent contended that the petitioner failed to substantiate the reasons for the delay.

Held

The Tribunal held that ignorance of law is not a valid ground for condonation of delay under Section 119(2)(b) of the Income Tax Act, 1961. The court referred to the principle of 'ignorantia juris non excusat' (ignorance of law is not an excuse) and cited judgments from the Delhi High Court in Manjit Singh Dhaliwal Vs. Commissioner Of Income Tax International Taxation and Sanjay Khurana v. Income Tax Department Ministry of Finance. The Tribunal found that genuine hardship, as contemplated for condonation, requires real, unavoidable financial or practical difficulties arising from extraordinary circumstances beyond the assessee's control. The petitioner failed to demonstrate such hardship, and their claim of ignorance of law was not sufficient to establish bonafide with evidence. Therefore, the PCIT rightly disallowed the condonation of delay. The judgment in G.V. Infosutions Pvt. Ltd. was deemed not applicable in this case. The writ petition was dismissed.

Key Issues

1. Whether the Principal Commissioner of Income Tax erred in refusing to condone the delay in filing the Income Tax Return for Assessment Year 2022-2023, under Section 119(2)(b) of the Income Tax Act, 1961, when the delay was allegedly due to ignorance of law and genuine hardship? Assessee's arguments: The petitioner argued that Section 119 of the Act allows condonation of delay if it is neither intentional, willful, nor deliberate. They claimed to have submitted sufficient reasons for condonation, highlighting genuine hardship, but these were not considered by the respondent. The petitioner also contended that the application was rejected mechanically and without an opportunity for a hearing, and that the respondent was duty-bound to address the reasons provided. Revenue's arguments: The respondent countered that the petitioner was given an opportunity to substantiate the reasons for the delay but failed to do so. They relied on judgments stating that ignorance of law is not an excuse and that genuine hardship requires circumstances beyond the taxpayer's control. The respondent argued that the petitioner's ground for condonation was ignorance of law, which is unexcusable.