MOORTHEDHARA SEVA SAHAKARI SANGHA NIYAMITHA vs. PRINCIPAL COMMISSIONER OF INCOME TAX PCIT

PDF · subscribers
WP/21458/2024HC KarnatakaKAHC01044156202418 September 2025Bench: M.NAGAPRASANNA10 pages
AI SummaryAllowed

What did the High Court hold?

The High Court allowed the writ petition and quashed the impugned order dated 09-12-2022 passed by the 1st respondent (PCIT). The Court condoned the delay in filing the Income Tax Return (ITR) for the Assessment Year 2019-20. The reasoning was based on the undisputed facts that the delay was caused by the Secretary's genuine and severe health issues (Parkinson's disease and Parkinson Plus Syndrome), which led to administrative difficulties and inability to file the return within the stipulated time. The Court referred to a coordinate bench's decision in W.P.No.19531 of 2023, which also dealt with condoning delay for cooperative societies eligible for Section 80P deduction, citing a CBDT Circular No.13/2023. The Court found the facts in the present case to be identical to the cited precedent, concluding that the delay was for reasons beyond the petitioner's control. The operative direction was to quash the impugned order and condone the delay.

What were the facts?

The petitioner, Moorthedharara Seva Sahakari Sangha Niyamitha, a cooperative society, is before the High Court of Karnataka challenging an order dated 09/12/2022 passed by the Principal Commissioner of Income Tax (PCIT), Panaji, under Section 119(2)(b) of the Income Tax Act, 1961. The petitioner sought condonation of delay in filing its income tax return for Assessment Year 2019-20. The society, which caters to the financial needs of toddy-tappers, claims eligibility for deduction under Section 80P. Due to serious health issues of its Secretary (suffering from Parkinson's disease and Parkinson Plus Syndrome) and administrative difficulties, the society failed to file its return by the due date. An application for condonation of delay was filed on 30/09/2020, which was rejected by the PCIT, leading to the present writ petition.

What were the issues?

1. Whether the order dated 09/12/2022 issued by the Principal Commissioner of Income Tax under Section 119(2)(b) of the Income Tax Act, 1961, rejecting the condonation of delay in filing the return of income for Assessment Year 2019-20, is liable to be quashed? (Question of law and fact, turning on Section 119(2)(b)). Assessee's Contention: The delay in filing the income tax return was due to genuine difficulties, specifically the severe health issues of the Secretary, which prevented timely filing. Several High Courts have condoned delays in similar circumstances where genuine causes and hardship are demonstrated. The petitioner relies on the principle of liberal interpretation in such cases. Revenue's Contention: The revenue's counsel, while refuting the petitioner's submissions, admitted the legal position laid down by various High Courts regarding a liberal approach to condoning delays when genuine causes are shown.

Which sections of the Income-tax Act were involved?

Section 119(2)(b),Section 80P,Section 139(1),Section 143(2)

AI-generated summary — verify with the full judgment below

- 1 -

HC-KAR NC: 2025:KHC:43305 WP No. 21458 of 2024

IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 18TH DAY OF SEPTEMBER, 2025 BEFORE THE HON'BLE MR. JUSTICE M.NAGAPRASANNA WRIT PETITION NO. 21458 OF 2024 (T-IT) BETWEEN:

1.

MOORTHEDHARARA SEVA SAHAKARI SANGHA NIYAMITHA A CO-OPERATIVE SOCIETY REGISTERED UNDER THE KARNATAKA CO-OPERATIVE SOCIETY ACT, 1959 REGISTERED ADDRESS AT: UPPINANGADY, PUTTUR DAKSHINA KANNADA DISTRICT – 574 241 REPRESENTED BY ITS CEO SRI DEEKAYYA S/O SRI CHENNAPPA POOJARY AGED ABOUT 44 YEARS. …PETITIONER (BY SRI SHREEHARI KUTSA, ADVOCATE) AND:

1.

PRINCIPAL COMMISSIONER OF INCOME TAX PCIT, PANAJI AAYAKAR BHAVAN, PLOT NO.05, EDC COMPLEX, PATTO PLAZA PANAJI, GOA-403001 AN AUTHORITY UNDER THE INCOME TAX ACT, 1961. REPRESENTED BY THE PRINCIPAL COMMISSIONER OF INCOME TAX (NeAC).

Digitally signed by RAKESH S HARIHAR Location: High Court of Karnataka, Dharwad Bench, Dharwad

- 2 -

HC-KAR NC: 2025:KHC:43305 WP No. 21458 of 2024

2.

INCOME TAX OFFICER WARD 1, PUTTUR THE JURISDICTIONAL ASSESSING OFFICER UNDER THE INCOME TAX ACT, 1961 INCOME TAX OFFICE RADHIKA COMPLEX, COURT ROAD PUTTUR – 574 201. …RESPONDENTS (BY SRI M.THIRUMALESH, ADVOCATE)

THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO A) QUASH THE ORDER UNDER SECTION 119(2)(b) OF THE INCOME TAX ACT, 1961 DATED 09/12/2022 ISSUED BY THE R1 FOR THE ASSESSMENT YEAR 2019-20 WHICH BEARS THE DIN VIZ., ITBA/COM/M/17/2022-23/1047950841(1) AND BEARING FOLIO NUMBER F NO. 122/119(2)(b)/PETITIONER.CIT- PNJ/2022-23 WHICH IS ENCLOSED AS ANN-F1.B) TO CONDONE THE DELAY IN FILING OF THE RETURN OF INCOME PURSUANT TO THE APPLICATION FILED UNDER SECTION 119(2)(b) DTD 30.09.20 OF THE ACT ENCLOSED IN ANN-E.

THIS PETITION, COMING ON FOR PRELIMINARY HEARING, THIS DAY, ORDER WAS MADE THEREIN AS UNDER:

- 3 -

HC-KAR NC: 2025:KHC:43305 WP No. 21458 of 2024

CORAM: HON'BLE MR. JUSTICE M.NAGAPRASANNA

ORAL ORDER

The petitioner is before this Court seeking the following prayers: a. Issue a Writ of Certiorari or direction in the nature of writ of certiorari quashing the order under section 119(2)(b) of the Income Tax Act, 1961 dated 09/12/2022 issued by the Respondent No.1 for the Assessment Year 2019-20 which bears the DIN viz., ITBA/COM/M/17/2022- 23/1047950841(1) and bearing folio number F No.122/119(2)(b)/Pr.CIT-PNJ/2022-23 which is enclosed as Annexure F1. b. Issue a writ of mandamus or direction in the nature of writ of mandamus to condone the delay in filing of the return of income pursuant to the application filed under section 119(2)(b) dated 30/09/2020 of the Act enclosed in Annexure E. c. And pass such other orders as this Hon’ble Court deems fit and proper in the interest of justice and equity including awarding of cost of this Petition.

2.

The petitioner, a Cooperative Society registered under the Karnataka Cooperative Societies Act, 1959. It is said to be eligible for deduction under Section 80P of the Income Tax Act, 1961 and no income tax is payable by the petitioner. Petitioner claims to be a small organization consisting of 6 permanent and 11 temporary staff operating around Uppinagady catering to

- 4 -

HC-KAR NC: 2025:KHC:43305 WP No. 21458 of 2024

the financial needs of the toddy-tappers. For the year 2019-2020 owing to serious health issues of the Secretary and various administrative difficulties the petitioner did not file its income tax returns within the due date. The petitioner then files an application seeking condonation of delay in filing the income tax returns. The respondents rejects the application seeking condonation of delay and thereby rejecting the income tax returns to be filed on such delay. It is therefore the petitioner is before this Court in the subject petition.

3.

Heard Sri Shreehari Kutsa, learned counsel appearing for petitioner and Sri M Thirumalesh, learned counsel appearing for respondents.

4.

The learned counsel for the petitioner would vehemently contend that the delay in filing the income tax return has accrued on genuine difficulty. The Secretary of the petitioner was suffering from Parkinson’s disease and therefore, on noticing the fact that the Secretary had not filed the returns in time, preferred an application seeking condonation of delay. It is his submission that the petitioner had genuine cause for

- 5 -

HC-KAR NC: 2025:KHC:43305 WP No. 21458 of 2024

not filing the returns within time and genuine hardship is what several High Courts have considered in condoning the delay and entertaining delayed filing of income tax returns.

5.

Learned counsel for the respondents Sri M. Thirumalesh would though refute the submissions of the learned counsel for petitioner, would admit the law as laid down by several High Courts with regard to a liberal approach in entertaining the income tax returns filed after delay, if genuine cause is shown.

6.

I have given my anxious consideration to the submissions made by the respective learned counsel and have perused the material on record.

7.

The afore-narrated facts are not in dispute. The petitioner being a Cooperative Society to cater to the needs of toddy-tappers is a matter of record. For the period i.e., financial year 2018-19, the petitioner did not file its returns. The returns were not filed on account of the Secretary of the

- 6 -

HC-KAR NC: 2025:KHC:43305 WP No. 21458 of 2024

petitioner suffering Parkinson’s. The averment to that effect is as follows: “5. The Petitioner states at the outset that during the Financial Year (hereinafter referred to as ‘FY’) 2018- 19 relevant to Assessment year (hereinafter referred to as ‘AY’) 2019-20 the Petitioner could not file its income tax return. The due date for the same ended on 30/11/2019. It is submitted that the return could not be filed for the reason that the erstwhile Secretary (Chief Executive) appointed by the Petitioner/Society for managing and deciding the day-to-day affairs of the Society was suffering from initial stage of Chronic Neurological Conditions and Parkinson Plus Syndrome for (PSD+CBD Syndrome) and the society was kept in dark about the same for some time. A true copy of the Medical Certificate of 75% Disability dated 25/03/2020 is enclosed as Annexure C.”

In the light of the said problem of the Secretary who had the aforesaid health issue, it is the further averment that the official work had suffered, the result of the suffering is delay in filing the returns. Eventually an application comes to be filed on 13-10-2020 for condonation of delay in filing the income tax returns under Section 119(2)(b) of the Income Tax Act. This comes to be rejected. The issue now would be, whether when genuine cause is shown, delay should be condoned or otherwise.

- 7 -

HC-KAR NC: 2025:KHC:43305 WP No. 21458 of 2024

8.

Jurisprudence is replete with the coordinate benches of this Court considering this very issue in condoning the delay and permitting filing of the returns. The coordinate bench of this Court in W.P.No.19531 of 2023 disposed on 21-09-2023 has held as follows: “7. This Court must also refer to the Circular dated 26.07.2023 in No.13/2023 issued by the Central Board of Direct Taxes on condonation of delay in filing ITR and allowing deductions under Section 80P of the IT Act for various assessment years starting from 2018-19, and the relevant paragraphs would be:

“4. In order to mitigate genuine hardship in cases referred to in para 3, the Board, in exercise of the powers conferred under section 119 of the Act, hereby directs that the Chief Commissioners of Income· tax (CCs/T) / Directors General of lncome·tax (DGsIT) are authorised to deal with such applications of condonation of delay pending before the Board, upon transfer of such applications by the Board, and decide such applications on merits, in accordance with the law.

5.

The Board hereby further directs that the CCsIT/DGsIT, henceforth, shall admit all pending as well as new applications for condonation of delay in furnishing returns of income claiming deduction u/s 80P of the Act, filed either in the Board or in field formation for the assessment years 2018·19 to 2022·23 and decide such applications on merits in accordance with the law where such person is required to get his accounts audited under respective State Laws.”

8.

Sri Shreehari Kutsa, allaying the apprehension that the petitioner will contest the assessment on the ground of delay, submits that the timeline must necessarily be computed from the date

- 8 -

HC-KAR NC: 2025:KHC:43305 WP No. 21458 of 2024

the delay is condoned or such other reasonable time as may be observed by this Court. This Court must observe that even otherwise, this aspect will be considered by the Courts depending on the circumstances of each case, when a case for condonation of the delay is established. As such, this Court is not persuaded to opine that the petitioner must be refused indulgence as against the third respondent's impugned order on the grounds urged on behalf of the respondents if this Court is of the opinion that both sufficient reasons and hardship are established for condonation of the delay.

9.

The petitioner had to file ITR on or before 31.10.2018 in terms of Section 139(1) of the IT Act, and because of the provisions of Section 139(1) of the IT Act, the ITR could have been filed until 31.12.2018. The petitioner has filed the ITR on 31.12.2018. There is no dispute that the elections to the Managing Committee is held on 27.01.2019. This Court must observe that elaborate electoral processes such as finalization of voters list are contemplated under the provisions of the Karnataka Co-operative Societies Act/Rules, and these processes which will have to be commenced within certain timeline will have to be completed on or before the calendar of events of elections are announced.

10.

As such, some part of this elaborate exercise will be made during the time between 31.10.2018 and 31.12.2018 to hold elections on 27.01.2019. When an application is filed for condonation of delay by a Co-operative Society, as clarified by the above Circular dated 26.07.2023, the concerned will have to examine whether the delay in filing ITR was caused due to circumstances beyond control, and in the circumstances of this case, it must be opined that the delay is for reasons beyond the petitioner’s control. In the light of the aforesaid, this Court is of the considered view that the

- 9 -

HC-KAR NC: 2025:KHC:43305 WP No. 21458 of 2024

impugned order must be quashed and the delay in filing ITR has to be condoned but observing that the time for commencement of limitation for the purposes of Section 143(2) of the IT Act must be reckoned from the end of 31.12.2023. Hence, the following:

ORDER

[A] The petition is allowed, and the third respondent's impugned order dated 23.05.2023 is quashed condoning the delay of 61 days in the petitioner filing ITR for the Assessment year 2018-19. Consequentially, the demand dated 31.05.2019 as per Annexure-E is also quashed.

[B] The respondents shall be entitled for limitation for the purposes of Section 143(2) of the IT Act from 31.12.2023. It is clarified that the timeline for completion of the assessment will have to be necessarily reckoned from the expiry of three months now provided for viz., 31.03.2024. Consequentially, the demand dated 31.05.2019 as per Annexure-E is also quashed.”

In the light of the facts in the case at hand being identical to the order passed by the coordinate bench supra, with the prayer being condonation of delay and acceptance of the returns, the petition deserves to succeed.

- 10 -

HC-KAR NC: 2025:KHC:43305 WP No. 21458 of 2024

9.

For the aforesaid reasons, the following:

ORDER (i) Writ Petition is allowed. (ii) The impugned order dated 09-12-2022 passed by the 1st respondent is quashed, condoning the delay in filing ITR for the Assessment year 2019-20.

Pending application if any, also stands disposed.

Sd/- (M.NAGAPRASANNA) JUDGE

BKP List No.: 1 Sl No.: 18

More judgments on Section 119(2)(b)

All 980 judgments and leading authorities on Section 119(2)(b) →

Recent GST High Court judgments

Search GST case law →