SUNIL C. BILGI, vs. THE PRINCIPAL COMMISSIONER OF INCOME TAX,

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WP/109740/2016HC KarnatakaKAHC02002807201619 January 2024Author: HEMANT CHANDANGOUDAR4 pages
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What did the High Court hold?

The High Court allowed the writ petition. It quashed the impugned order dated 01.06.2016 passed by the Principal Commissioner of Income Tax, thereby condoning the delay in filing the income tax returns for assessment years 2008-09, 2009-10, and 2010-11. The Court reasoned that the petitioner is a small businessman claiming a refund of Rs.2,76,550, and the dismissal of his application would cause him monetary loss and genuine hardship. Given the meager amount claimed and the potential hardship, the Court found it appropriate to condone the delay. The Court directed the respondent to consider the petitioner's claim for refund of tax deducted at source for the specified assessment years and pass an appropriate order in accordance with law after notifying the petitioner. No issue was expressly left undecided.

What were the facts?

The petitioner, Sunil C. Bilgi, filed income tax returns for assessment years 2008-09, 2009-10, and 2010-11, declaring total incomes of Rs.32,000, Rs.8,000, and Rs.1,28,000 respectively, and claiming refunds of Rs.45,320, Rs.11,300, and Rs.1,81,280. The petitioner subsequently filed an application for condonation of delay in filing these returns under Section 119(2)(b) of the Income Tax Act. The Principal Commissioner of Income Tax rejected this application, citing a lack of sufficient cause for the delay. This rejection led the petitioner to file a writ petition before the High Court of Karnataka, Dharwad Bench, challenging the order of the Principal Commissioner.

What were the issues?

1. Whether the delay in filing the income tax returns for assessment years 2008-09, 2009-10, and 2010-11 should be condoned under Section 119(2)(b) of the Income Tax Act, considering the petitioner's claim of genuine hardship and a substantial refund amount. The assessee (petitioner) argued that he is a small businessman and is claiming an excess payment of Rs.2,76,550, for which he is entitled to a refund. The dismissal of his application for condonation of delay would result in monetary loss and genuine hardship. He contended that the amount claimed is meager and, therefore, the delay should be condoned. The assessee relied on the Income Tax Department's circular dated 09.06.2015, which provides guidelines for condoning delays in filing returns for refund claims and carry forward of losses. The revenue (respondent) did not record any specific arguments in the judgment, other than their action of rejecting the application for condonation of delay.

Which sections of the Income-tax Act were involved?

Section 119(2)(b)

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH DATED THIS THE 19TH DAY OF JANUARY, 2024 BEFORE THE HON'BLE MR JUSTICE HEMANT CHANDANGOUDAR WRIT PETITION NO. 109740 OF 2016 (T-IT) BETWEEN:

SUNIL C. BILGI, AGE: 55 YEARS, OCC: BUSIENSS, R/O: ANANDA PRABHA, GROUND FLOOR, RS 1379, 2ND MAIN, 1A, BEHIND JAIN MANDIR, SADASHIV NAGAR, BELGAAVI.

…PETITIONER (BY SRI. KRISHNAKUMAR JOSHI, ADV. FOR SRI.SANGRAM S KULKARNI, ADV.)

AND:

THE PRINCIPAL COMMISSIONER OF INCOME TAX, OPP CIVIL HOSPITAL, KHIMJIBAI COMPLEX, BELAGAVI-590001 …RESPONDENT (BY SRI. Y V RAVIRAJ, ADVOCATE)

THIS WP IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO ISSUE WRIT OF CERTIORARI AND QUASH THE IMPUGNED ORDER VIDE NO.F.NO.50(15- 16)/119(2)(b)/Pr.CIT/BGV/2016-17 DATED 01/06/2016 PASSED BY THE RESPONDENT VIDE ANNEXURE – E.

THIS PETITION, COMING ON FOR PRELIMINARY HEARING IN B GROUP, THIS DAY, THE COURT MADE THE FOLLOWING:

SUJATA SUBHASH PAMMAR Digitally signed by SUJATA SUBHASH PAMMAR Date: 2024.01.23 03:11:06 -0800

ORDER

The petitioner filed returns of income for the assessment years 2008-09, 2009-10 and 2010-11 declaring total income of Rs.32,000, Rs.8,000/- and Rs.1,28,000/-, and claimed refund of Rs.45,320/-, Rs.11,300/- and Rs.1,81,280/- respectively. The application filed for condonation of delay under Section 119(2)(b) of the Income Tax Act was rejected on the ground that the petitioner has not shown sufficient cause for condoning the delay in filing the returns. Hence this petition.

2.

Heard the learned counsel for the petitioner and the learned counsel for the respondent.

3.

The Income Tax Department has issued a circular dated 09.06.2015, by which, guidelines are issued to deal with the application for condonation of delay in filing the returns claiming refund and returns claiming carry forward of loss and set off thereof under Section 119(2)(b) of the Income Tax Act. 4. Para 5 of the circular lays down the criteria for condoning the delay, and it states that at the time of considering the case under Section 119(2)(b) of the Income Tax Act, it shall be ensured that the income / loss declared and

/ or refund claim is correct and genuine and also that the case of genuine hardship on merits. 5. The petitioner is a small businessman, and is claiming an amount of Rs.2,76,550/- which was allegedly paid in excess, and if the petitioner is entitled for refund of the said amount, the dismissal of the application will cause monetary loss to the petitioner, thus, causing genuine hardship. The amount claimed being very meager, it would be appropriate if the application submitted by the petitioner for condonation of delay is condoned. Accordingly, I pass the following: ORDER (i) Writ petition is allowed. (ii) The impugned order dated 01.06.2016 passed by the respondent at Annexure – E is hereby quashed, and the delay in filing the income tax returns for the assessment years 2008-09, 2009-10 and 2010-11 is hereby condoned. (iii) The respondent to consider the case of the petitioner, claiming refund of tax deducted

at source by the payee for the assessment years 2008-09, 2009-10 and 2010-11 and pass appropriate order in accordance with law after notifying the petitioner.

Sd/- JUDGE

RSH LIST NO.: 2 SL NO.: 68

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