MR AMJAD PASHA vs. THE CENTRAL BOARD OF DIRECT TAXES

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WP/8405/2025HC KarnatakaKAHC01018831202509 April 2025Bench: S.R.KRISHNA KUMAR6 pages
AI SummaryAllowed

What did the High Court hold?

The High Court allowed the writ petition. It held that the respondent authorities had adopted a hyper-technical approach in rejecting the petitioner's application for condonation of delay. The Court found that the petitioner's inability to file returns within the prescribed period was due to his non-resident status in the UAE and a lack of knowledge of Indian tax rates, which constituted bonafide reasons, unavoidable circumstances, and sufficient cause, leading to genuine hardship as contemplated by Circular No. 9/2015. The Court deemed it just and appropriate to set aside the impugned orders and condone the delay. The operative directions included allowing the petition, setting aside the impugned orders dated 15.03.2022 and 12.04.2024, allowing the application for condonation of delay, and directing the respondents to accept the returns filed by the petitioner for AYs 2015-16, 2016-17, and 2017-18, while liberty was granted to the respondents to verify the claims and proceed in accordance with law.

What were the facts?

The petitioner, Mr. Amjad Pasha, a non-resident residing in the UAE, sought condonation of delay in filing Income Tax Returns for Assessment Years (AYs) 2015-16, 2016-17, and 2017-18. The delays were 886, 521, and 521 days respectively. The petitioner contended that as a non-resident, he was unaware of Indian tax rates and faced bonafide reasons, unavoidable circumstances, and sufficient cause, constituting genuine hardship. The Deputy Commissioner of Income-Tax (International Tax) Circle - 2(1), Bengaluru, rejected his application under Section 119(2)(b) of the Income-Tax Act, 1961. The Central Board of Direct Taxes (CBDT) also refused to interfere with this order. The petitioner filed a writ petition before the High Court of Karnataka seeking to quash these orders.

What were the issues?

1. Whether the respondent authorities committed an error in rejecting the petitioner's application for condonation of delay under Section 119(2)(b) of the Income-Tax Act, 1961, for Assessment Years 2015-16, 2016-17, and 2017-18? (Mixed question of law and fact) The petitioner argued that the delay in filing returns was due to his non-resident status, lack of awareness of Indian tax rates, and bonafide reasons, unavoidable circumstances, and sufficient cause, which amounted to genuine hardship as per Circular No. 9/2015 dated 09.06.2015. He contended that the respondents adopted a hyper-technical approach and failed to appreciate these grounds. The revenue supported the impugned orders, arguing that the petition lacked merit and 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:15375 WP No. 8405 of 2025

IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 9TH DAY OF APRIL, 2025 BEFORE THE HON'BLE MR JUSTICE S.R.KRISHNA KUMAR WRIT PETITION NO. 8405 OF 2025 (T-IT) BETWEEN:

MR. AMJAD PASHA AGED ABOUT 64 YEARS, CITIZEN OF INDIA, RESIDING AT 1132/23, MOSQUE ROAD, LBS NAGAR, BANGALORE – 560 017, ALSO AT 61-A, MITTAL TOWER, NARIMAN POINT, MUMBAI – 400 021 AND ALSO AT 14, W/H K2, PO BOX – 48659 SHARJAH, UAE …PETITIONER (BY SRI. DHARAM GANDHI FOR SRI. SANDEEP HUILGOL, ADVOCATES)

AND:

1.

THE CENTRAL BOARD OF DIRECT TAXES, DEPARTMENT OF REVENUE,

MINISTRY OF FINANCE,

GOVERNMENT OF INDIA,

NORTH BLOCK, NEW DELHI – 110 001.

2.

THE CHIEF COMMISSIONER OF

INCOME-TAX (INTERNATIONAL TAXATION)

SOUTH ZONE, BENGALURU

CR BUILDING, QUEENS ROAD,

BENGALURU – 560 001.

3.

THE DEPUTY COMMISSIONER OF

INCOME-TAX, INTERNATIONAL TAX

CIRCLE - 2(1), BENGALURU

CR BUILDING, QUEENS ROAD,

BENGALURU – 560 001.

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

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NC: 2025:KHC:15375 WP No. 8405 of 2025

4.

THE COMMISSIONER OF INCOME-TAX, (INTERNATIONAL TAXATION), BENGALURU CR BUILDING, QUEENS ROAD,

BENGALURU – 560 001.

5.

THE UNION OF INDIA, THROUGH THE SECRETARY,

DEPARTMENT OF REVENUE,

MINISTRY OF FINANCE,

GOVERNMENT OF INDIA,

NORTH BLOCK, NEW DELHI – 110 001. …RESPONDENTS (BY SRI. E.I. SANMATHI & M.DILIP, ADVOCATES FOR R1 TO R4 SMT. SWATI L.KAMAT, ADV. FOR R5)

THIS WRIT PETITION IS FILED UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA PRAYING TO DIRECTION, CALLING FOR THE RECORDS OF THE PETITIONERS CASE AND AFTER GOING INTO THE LEGALITY AND PROPRIETY THEREOF, TO QUASH AND SET ASIDE THE IMPUGNED ORDER DATED 12.04.2024 PASSED BY THE 1ST RESPONDENT FOR AYS 2015-16, 2016-17 AND 2017-18 UNDER THE PROVISIONS OF THE INCOME-TAX ACT, 1961 (ANNEXURE-S) 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 order at Annexure–N dated 15th March 2022 passed by the respondent No.2, whereby the application filed by the petitioner under Section 119(2)(b) seeking condonation of delay of 886, 521 & 521 days in filing the income tax returns in relation to the Assessment Years 2015-16, 2016-17 and 2017-18 respectively,

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NC: 2025:KHC:15375 WP No. 8405 of 2025

were rejected by the respondent No.2 as well as the order at Annexure-S dated 12.04.2024 passed by the respondent No.1 refusing to interfere with the aforesaid order passed by the respondent No.2.

2.

Heard learned counsel for the petitioner and learned counsel for respondent Nos.1 to 5 and perused the material on record. 3. A perusal of the material on record will indicate that in relation to the aforesaid Assessment Years 2015-16, 2016-17 and 2017-18, the petitioner filed returns after the prescribed period along with the application seeking condonation of delay of 886, 521 and 521 days respectively, in filing the returns interalia contending that the since the petitioner is a non-resident in India and residing in the United Arab Emirates, he was not aware of the tax rates and owing to bonafide reasons, unavoidable circumstances and sufficient cause, the petitioner was not in a position to file the returns within the prescribed period. It was contended that the delay in filing the I.T. returns was due to genuine hardship as contemplated in the Circular No.9/2015 dated 09.06.2015 and as such, the respondent committed an error in rejecting the application

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NC: 2025:KHC:15375 WP No. 8405 of 2025

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 would support the impugned order 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 I.T. returns within the prescribed period was due lack of knowledge of the tax rates since the petitioner was a non-resident in India and was residing in the United Arab Emirates and as a result of which the petitioner could file the I.T. returns subsequent to expiry of the prescribed period. The respondents failed to appreciate that the petitioner could not file his I.T. returns 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

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NC: 2025:KHC:15375 WP No. 8405 of 2025

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 grounds pleaded by the petitioner in support of his claim for condonation of delay, I deem it just and appropriate to set-aside the impugned order and condone the delay in filing the returns by the petitioner by allowing the application filed by the petitioner. 7. In the result, I pass the following: O R D E R (i) The petition is hereby allowed. (ii) The impugned order at Annexure–N dated 15.03.2022 as well as the Order at Annexure-S dated 12.04.2024 are hereby set-aside; (iii) The application filed by the petitioner under Section 119(2)(b) for condonation of delay of 886, 521 & 521 days in filing Income Tax Returns for the Assessment Years 2015-16, 2016-17 & 2017- 18, respectively is hereby allowed; (iv) The respondents are directed to accept the returns submitted by the petitioner for the

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NC: 2025:KHC:15375 WP No. 8405 of 2025

aforesaid Assessment Years viz., 2015-16, 2016- 17 & 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

BMC List No.: 2 Sl No.: 119

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