CAPUCHIN FRIARS MINOR SOCIETY vs. THE COMMISSIONER OF INCOME TAX

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WP/6606/2024HC KarnatakaKAHC01012812202428 April 2025Bench: S.R.KRISHNA KUMAR5 pages
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What did the High Court hold?

The High Court held that the respondent No.1 adopted a hyper-technical approach in refusing to condone the delay without appreciating that the petitioner's inability to file Form 10 within the prescribed period was due to the non-compliance of their tax consultant. The Court found that the petitioner could not file Form 10 within the prescribed period on account of bonafide reasons, unavoidable circumstances, and sufficient cause, which constituted genuine hardship as contemplated in Circular dated June 9, 2015. The failure to appreciate this led to an erroneous conclusion. Adopting a justice-oriented approach, the Court deemed it just and appropriate to set aside the impugned orders and condone the delay in filing Form 10 by allowing the petitioner's applications. The impugned orders were set aside, and the respondents were directed to accept the Form 10 submitted by the petitioner for the relevant assessment years, with liberty to verify the claim and proceed further in accordance with law.

What were the facts?

The petitioner, Capuchin Friars Minor Society, filed a writ petition challenging orders dated December 22, 2023, passed by the Commissioner of Income Tax (Exemptions). These orders rejected the petitioner's applications filed under Section 119(2)(b) of the Income Tax Act, 1961, seeking condonation of delay in filing Form 10 for Assessment Years 2016-17 and 2017-18. The delays were 444 days for AY 2016-17 and 52 days for AY 2017-18. The petitioner contended that the delay was due to the failure of their tax consultant to file the returns and Form 10 within the prescribed period, attributing it to bonafide reasons, unavoidable circumstances, and sufficient cause, constituting genuine hardship.

What were the issues?

1. Whether the respondent No.1 committed an error in rejecting the petitioner's applications for condonation of delay under Section 119(2)(b) of the Income Tax Act, 1961, for Assessment Years 2016-17 and 2017-18, by adopting a hyper-technical approach without appreciating the genuine hardship faced by the petitioner. Assessee's Contentions: The petitioner argued that the delay in filing Form 10 was due to the tax consultant's failure to file the returns and Form 10 within the prescribed period. They contended that this was due to bonafide reasons, unavoidable circumstances, and sufficient cause, constituting genuine hardship as contemplated in Circular No. 9/2015 dated June 9, 2015. Therefore, the respondent erred in rejecting the applications. Revenue's Contentions: The learned counsel for the respondents supported the impugned orders and submitted that there was no merit in the petition and it was liable to be dismissed.

Which sections of the Income-tax Act were involved?

Section 119(2)(b)

AI-generated summary — verify with the full judgment below

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NC: 2025:KHC:17591 WP No. 6606 of 2024

IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 28TH DAY OF APRIL, 2025 BEFORE THE HON'BLE MR JUSTICE S.R.KRISHNA KUMAR WRIT PETITION NO. 6606 OF 2024 (T-IT) BETWEEN:

CAPUCHIN FRIARS MINOR SOCIETY, ALVERNO FRAIARYMONTE DE GUIRIM BARDEZ, NORTH GOA – 403 508 GOA, NATURE OF PETITIONER. REGISTERED UNDER SOCIETY REGISTRATION ACT, 1860 REPRESENTED BY ITS TREASURER, FR. ORFIN MENEZES, AGED ABOUT 54 YEARS, S/O MR. ANTHONY MENEZES, SOCIETY REGISTRATION CERTIFICATE NO.182/GOA/2000 PAN AAACC7611E …PETITIONER (BY SMT. JINITA CHATTERJI, ADV. FOR SRI. S. PARTHASARATHI, ADVOCATE)

AND:

1.

THE COMMISSIONER OF INCOME TAX (EXEMPTIONS) UNITY BUILDING ANNEXE, MISSION ROAD, BENGALURU – 560 027.

2.

THE INCOME TAX OFFICER (EXEMPTION) WARD .1, 3RD FLOOR, PUNDALIK NIWAS, MALA, RUA-DE-QUREM, PANAJI, GOA – 403 001. …RESPONDENTS (BY SRI. M. DILIP, ADVOCATE)

Digitally signed by CHANDANA B M Location: High Court of Karnataka

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NC: 2025:KHC:17591 WP No. 6606 of 2024

THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE ORDER U/S 119(2)(b) OF THE ACT DATED 22.12.2023 IN FILE NO. ITBA/COM/F/17/2023-24/1058998416(1) BY THE FIRST RESPONDENT FOR THE ASSESSMENT YEAR 2016-17 (ANNEXURE- E) AND ETC.

THIS PETITION, COMING ON FOR PRELIMINARY HEARING IN ‘B’ GROUP, THIS DAY, ORDER WAS MADE THEREIN AS UNDER:

CORAM: HON'BLE MR JUSTICE S.R.KRISHNA KUMAR

ORAL ORDER In this petition, petitioner seeks quashing of the impugned orders at Annexure – E, E1, F and F1 all dated 22.12.2023 passed by the respondent No.1, whereby the applications filed by the petitioner under Section 119(2)(b) seeking condonation of delay of 444 days, 444 days, 52 days and 52 days respectively in filing the Form 10 in relation to the Assessment Years 2016-17, 2016-17, 2017-18 and 2017-18 respectively was rejected by the respondent.

2.

Heard learned counsel for the petitioner and learned counsel for the respondents and perused the material on record. 3. A perusal of the material on record will indicate that in relation to the aforesaid Assessment Years 2016-17, 2016-17, 2017-18 and 2017-18, the petitioner Form 10 after the prescribed period along with the application seeking condonation of delay of

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NC: 2025:KHC:17591 WP No. 6606 of 2024

444 days, 444 days, 52 days and 52 days respectively in filing the Form 10 interalia contending that that the tax consultant who was entrusted with filing of returns for the petitioner failed to do so and owing to bonafide reasons, unavoidable circumstances and sufficient cause, the petitioner could not file Form 10 within the prescribed period. It was contended that the delay in filing Form 10 was due to genuine hardship as contemplated in the Circular No.9/2015 dated 09.06.2015 as such, the respondent committed an error in rejecting the applications for condonation of delay filed by the petitioner under Section 119(2)(b) of the I.T.Act, which deserves to be set aside.

4.

Per contra, learned counsel for the respondents- Revenue would support the impugned orders and submits that there is no merit in the petition and the same is liable to be dismissed.

5.

A perusal of the impugned order will indicate that the respondents have adopted hyper technical approach in refusing to condone the delay without appreciating that the inability and omission on the part of the petitioner to file Form 10 within the prescribed period was due to non-compliance on the part of the tax

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NC: 2025:KHC:17591 WP No. 6606 of 2024

consultant of the petitioner as a result of which, the petitioner could file the Form 10 subsequent to expiry of the prescribed period. The respondents failed to appreciate that the petitioner could not file its Form 10 within the prescribed period on account of bonafide reasons, unavoidable circumstances and sufficient cause, which clearly constituted genuine hardship on the part of the petitioner/assessee as contemplated in the said Circular dated 09.06.2015 and failure to appreciate this, has resulted in erroneous conclusion warranting interference by this Court in the present petition.

6.

Under these circumstances, adopting justice oriented approach and having regard to valid and sufficient ground pleaded by the petitioner in support of his claim for condonation of delay, I deem it just and appropriate to set aside the impugned orders and condone the delay in filing the returns by the petitioner by allowing the applications filed by the petitioner. 7. In the result, I pass the following: O R D E R (i) The petition is hereby allowed.

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NC: 2025:KHC:17591 WP No. 6606 of 2024

(ii) The impugned orders/Notices at Annexure – E, E1, F and F1 all dated 22.12.2023 and Annexure G and H both dated 10.01.2024, are hereby set- aside; (iii) The applications filed by the petitioner under Section 119(2)(b) for condonation of delay of 444 days, 444 days, 52 days and 52 days in filing Form 10 for the Assessment Years 2016-17, 2016-17, 2017-18 and 2017-18 respectively are hereby allowed; (iv) The respondents are directed to accept Form 10 submitted by the petitioner for the aforesaid Assessment Years 2016-17, 2016-17, 2017-18 and 2017-18; (v) It is needless to state that respondents are at liberty to verify the claim of the petitioner and proceed further in accordance with law.

Sd/- (S.R.KRISHNA KUMAR) JUDGE

MDS List No.: 1 Sl No.: 0

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