Shri Gujrati Mandal vs. Commissioner Of Income Tax Exemption

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WP/8828/2021HC Madhya Pradesh17 October 2022Bench: HON'BLE SHRI JUSTICE SHEEL NAGU3 pages
For Petitioner: Sapan Usrethe
AI SummaryRemanded

What did the High Court hold?

The High Court observed that disputed questions of fact pertaining to the issue of condonation of delay were involved. It further noted that the power to condone delay beyond the prescribed period is available with the CBDT under Section 119(2)(b) of the Income Tax Act. Consequently, the Court advised the petitioner to approach the CBDT. The CBDT was directed to consider the petitioner's prayer for condonation of delay on its own merits, provided the petition is filed within one month from the date of receipt of the Court's order. The High Court did not decide the merits of the condonation application itself but directed the petitioner to the appropriate authority.

What were the facts?

The petitioner, Shri Gujarati Mandal, filed a writ petition challenging an order dated March 3, 2021, passed by the Commissioner of Income Tax-Exemption, Bhopal. The Commissioner had declined to condone a delay of over 365 days in filing Form 10-B. The Revenue, represented by learned counsel, referred to CBDT circular dated January 3, 2020, which restricts the Commissioner's power to condone delays exceeding 365 days in filing Form 10-B. The Revenue also highlighted Section 119 of the Income Tax Act, which empowers the CBDT to issue instructions to subordinate authorities, including regarding condonation of delay.

What were the issues?

1. Whether the Commissioner of Income Tax-Exemption had the power to condone a delay exceeding 365 days in filing Form 10-B, as per Section 119(2)(b) of the Income Tax Act and relevant CBDT circulars? Assessee's Contention: The petitioner is challenging the order of the Commissioner declining condonation of delay. (No specific arguments on legal provisions or precedents are recorded for the petitioner in the judgment). Revenue's Contention: The Revenue argued that the Commissioner's power to condone delay is restricted by the CBDT circular dated January 3, 2020, to a maximum of 365 days. They relied on Section 119(2)(b) of the Income Tax Act, which empowers the CBDT to condone delays beyond the prescribed period. Therefore, the Revenue contended that the impugned order was in accordance with the law, and the petitioner should approach the CBDT.

Which sections of the Income-tax Act were involved?

Section 119,Section 119(2)(b)

AI-generated summary — verify with the full judgment below

Before: HONBLE SHRI JUSTICE SHEEL NAGU & HONBLE SHRI JUSTICE VIRENDER SINGH SHRI GUJRATI MANDAL THR ITS AND

IN THE HIGH COURT OF JUDICATURE FOR MADHYA PRADESH AT JABALPUR BEFORE HON'BLE SHRI JUSTICE SHEEL NAGU & HON'BLE SHRI JUSTICE VIRENDER SINGH WRIT PETITION No. 8828 OF 2021 Between:- SHRI GUJRATI MANDAL THR ITS TREASURER SHRI DEEPAK POPAT 01, CIVIC CENTRE MARHATAL, JABALPUR (MADHYA PRADESH) .....PETITIONER (BY SHRI SAPAN USRETHE, ADVOCATE) AND 1. COMMISSIONER OF INCOME TAX EXEMPTION 2ND FLOOR, METRO WALK BUILDING BITTAN MARKET, BHOPAL (MADHYA PRADESH) 2. INCOME

TAX

OFFICER

WARD EXEMPTION

CENTRAL

REVENUE BUILDING NAPIER TOWN JABALPUR (MADHYA PRADESH) 3. DEPUTY COMMISSIONER OF INCOME TAX CETRAL PROCESSING CENTRE INCOME TAX DEPARTMENT BANGALURU (KARNATAKA) .....RESPONDENTS (BY SHRI SANJAY LAL, ADVOCATE) - 2 - ---------------------------------------------------------------------------------------- Reserved on : 04.08.2022 Passed on : 17.10.2022 ---------------------------------------------------------------------------------------- Per : Justice Sheel Nagu : ORDER The present petition under Article 226/227 of the Constitution has been filed assailing order dated 03.03.2021(Annexure-P/1) passed by the Commissioner of Income Tax-Exemption, Bhopal (M.P.) declining condonation of delay of more than 365 days in filing Form 10-B. 2. Learned counsel for Revenue has drawn the attention of this Court to the CBDT circular dated 03.01.2020, which inter alia, restricts the power of the Commissioner of condoning delay for more than 365 days in filing Form No.10B. 3. Learned senior standing counsel for Income Tax Department has also drawn the attention of this Court to Section 119 of IT Act vesting power in CBDT to issue instructions to authorities sub- ordinate to it, inter alia for condonation of delay. 4. Section 119(2)(b) in specific terms empowers the Board to condone delay beyond the period prescribed under the Act. Relying upon the said provision u/S.119(2)(b), learned counsel for the - 3 - Revenue contends that petitioner can approach CBDT against impugned order dated 03.03.2021. He further submits that the order impugned is in accordance with law since the Commissioner of Income Tax is not vested with any power to condone delay beyond the period of 365 days and therefore, the impugned order cannot be found fault with. 5. After hearing learned counsel for the rival parties and perusing the material on record, it is revealed that since disputed questions of fact pertaining to the issue of condonation of delay are involved and the power to condone delay is available with CBDT u/S.119(2)(b), the petitioner is well advised to approach the Board, which if done within a period of one month from the date of receipt of copy of this order, the CBDT shall consider the prayer for condonation of delay on its own merits. 6. With the aforesaid, present petition stands disposed of. (SHEEL NAGU) (VIRENDER SINGH) JUDGE JUDGE Sateesh Digitally signed by SATEESH KUMAR SEN Date: 2022.10.17 14:38:36 +05'30'

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