Income Tax Return - Gujarat High Court

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C/SCA/15075/2015 JUDGMENT

IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

SPECIAL CIVIL APPLICATION NO. 15075 of 2015

FOR APPROVAL AND SIGNATURE:

HONOURABLE MS.JUSTICE HARSHA DEVANI

and

HONOURABLE MR.JUSTICE A.G.URAIZEE

================================================================

1 Whether Reporters of Local Papers may be allowedto see the judgment ?

2 To be referred to the Reporter or not ?

3 Whether their Lordships wish to see the fair copy ofthe judgment ?

Whether this case in!ol!es a substantial "uestion oflaw as to the interpretation of the #onstitution of$ndia or any order made thereunder ?

================================================================

ALL GUJARAT FEDERATION OF TAX CONSULTANTS....Petitioner(s)

Versus

CENTRAL BOARD OF DIRECT TAXES & 1....Respondent(s)

================================================================Appearance:

MR SN SOPARKAR, SR. ADVOCATE with MR MANISH K KAJI, ADVOCATE

for the Petitioners

MR MR BHATT, SR. ADVOCATE with MRS MAUNA M BHATT, ADVOCATE for

the Respondents

================================================================

#%R&'( HONOURABLE MS.JUSTICE HARSHA DEVANI

andHONOURABLE MR.JUSTICE A.G.URAIZEE

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Date : 29/09/2015

ORAL JUDGMENT

(PER : HONOURABLE MS.JUSTICE HARSHA DEVANI)

1. Rule. Mrs. Mauna Bhatt, learned senior standing counsel

waives service of notice of rule on behalf of the respondents.

2. Having regard to the controversy involved in the present

case and the urgency of the matter as discussed hereinafter,

the court has heard the matter finally.

3. By this petition under rticle 22! of the "onstitution of

#ndia, the petitioners see$ the following substantive reliefs %

[13] The petitioner, therefore, prays :-

[a] that this Honble Court may be pleased toissue a writ of mandamus, or any other appropriate writ,

order or diretion, diretin! that the respondent hene

forth, ma"e any alternations in #orms and $tilities or

han!es in ta% ompliane re&uirements, appliable from

the '()( subse&uent to the '()( in whih suh alterations

are introdued(

[b] that this Honble Court may be pleased to

issue a writ of ertiorari, or any other appropriate writ,

order or diretion holdin! the impu!ned announement

dated *+*+1. as bein! ille!al, inasmuh as, it promotes

the filin! of /T0 without the mandatorily re&uired T'0(

[] that this Honble Court may be pleased to

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issue a writ of mandamus, or any other appropriate writ,

order or diretion, diretin! that the respondent to

e%tend the due date for filin! the /T0 and T'0 to

3+11+1.(

&. 'he first petitioner is a 'rust registered under the

provisions of the Bombay (ublic 'rusts ct, 1)*+ and has over

1+++ members who are various professionals, being

dvocates, "hartered ccountants and 'a (ractitioners

engaged in the field of taation. 'he second petitioner is the

(resident of the first petitioner -ederation and is also assessee

who is directly interested in the subect matter of the petition.

*. 'he controversy involved in the present case arises in the

following bac$drop. By a notification dated +1.+*.2+13 the first

respondent made it mandatory for the assessees, to

electronically file the income ta returns relevant forassessment year 2+13/1& and onwards. #n relation to

assessment year 2+1&/1*, the respondents failed to ma$e the

utility software for filing 'R until 21st ugust, 2+1&.

Representations were made to the "entral Board of 0irect

'aes, which in eercise of powers under section 11) of the ct

etended the due date for filing the 'a udit Report 'R

under section &&B of the #ncome 'a ct, 1)!1 hereinafter

referred to as the ct4 to 3+th5ovember, 2+1&6 however, the

due date for filing of return of income was not etended. 'he

petitioners, therefore, made representations to the "entral

Board of 0irect 'aes hereinafter referred to as the Board4

for etending the due date of filing return to 3+th 5ovember,

2+1*, but to no avail. 'he petitioners therefore approachedthis court by way of writ petitions being 7pecial "ivil

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pplication 5o. 12!*! of 2+1& and 12*81 of 2+1&. 'he said

petitions came to be allowed by directing "B0' to etend the

due date for filing the income ta return to 3+th 5ovember,

2+1&.

!. #n relation to the current year, vi9., assessment year

2+1*/1!, the 0epartment delayed notifying the #'R forms

being #'R/1, #'R/2, #'R/2, #'R/&7 but etended the due date

for filing the income ta returns in the case of such assessees

to 31stugust, 2+1*. 'he on/line forms in relation to assessees

subect to ta audit and other assessees, vi9., -orms #'R/3, #'R/

&, #'R/*, #'R/! and #'R/8 in relation to assessment year 21+*/

1! came to be notified on 2).8.2+1* and the forms were e/

enabled and were available on the e/filing website of the

0epartment only from 8thugust, 2+1*. 7ince the income ta

returns in case of such assessees were to be filed on or before

3+.+).2+1*, according to the petitioners the delay in ma$ingthe form available caused utter confusion and chaos amongst

the "hartered ccountants and the assessees. #t is the case of

the petitioners that the ta audit returns can only be filed

electronically which re:uires an appropriate utility;software4

to be made available by the respondents to the assessees.

However, the respondents failed to ma$e available the utilities

for assessment year 2+1* /1! until +8.+


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representations yielded no results, and the respondents did

not grant etension of due date for filing the income ta

returns. >n the contrary by an announcement dated )th

7eptember, 2+1* the =overnment of #ndia Ministry of -inance,

it was stated that a decision had been ta$en that the last date

of filing of returns due by 3+th7eptember, 2+1* will not be

etended. #t is in these circumstances that the petitioners have

approached this court see$ing the reliefs noted hereinabove.

8. Mr. 7. 5. 7opar$ar, 7enior dvocate, learned counsel with

Mr. Manish ?ai, learned advocate for the petitioners submitted

that with effect from assessment year 2+13/1&, it is mandatory

for the assessees to electronically file the income ta returns

online. #t was submitted that the utility for filing the income ta

returns in respect of the assessees who are subect to ta

audit, came to be released only on 8thugust, 2+1* and was

subse:uently updated on 22nd

ugust, 2+1*. #t was submittedthat while under the statutory provisions, the income ta

returns can be filed in time from 1stpril till the due date for

filing the income ta returns, in the absence of the utility for

filing such returns online, the returns could not be filed earlier.

#t was submitted that there was significant delay in providing

the utility for filing the returns online, that is, 8 thugust, 2+1*

and prior thereto, till the utility was made available, it was not

possible to file the income ta returns. #t was submitted that in

respect of such delay, the assessees are not at fault and that

till the online forms are prescribed, the assessees do not $now

the nature of the changes made and till such forms are

notified, they cannot file the returns. #t was submitted that in

relation to assessment year 2+1&/1* also, the respondents hadetended the time for filing the ta audit report, however, time

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for filing the income ta returns had not been etended and

the petitioners had approached this court see$ing etension of

the time limit for filing the income ta returns. 'he attention of

the court was invited to the udgment and order dated 22nd

7eptember, 2+1& passed by this court in the petitioner@s own

case in 7pecial "ivil pplication 5o.12!*! of 2+1& and allied

matter, to point out that the court had observed that any

introduction or new utility;software with additional re:uirement

in the middle of the year ordinarily is not desirable. ny

change unless inevitable can be planned well in advance.

?eeping in focus such comprehensive process re/engineering

may not result in undue hardship to the sta$e holders for

whose benefits the same operates. #t was submitted that the

hope epressed by the court is belied by the respondents by

once again notifying online forms belatedly on 8thugust, 2+1*

and not granting sufficient time to the assessees to submit the

same.

8.1 Mr. 7opar$ar submitted that the #ncome 'a ct

prescribes time from 31stMarch to 3+th7eptember, that is, 1


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announcement dated +).+).2+1* issued by the Ministry of

-inance nneure 4 to the petition wherein, it has been

stated that /nome Ta% 0eturns #orms 3, 2, ., and 4 whih

are used by the ompanies, firms, indi5iduals en!a!ed in

proprietary business+professional et(, whose aounts are to

be audited, were notified for assessment year 1.-1 on

*(4(1.( The forms were e-enabled and were a5ailable on

the e-filin! website of the 6epartment from 4th'u!ust, 1.

!i5in! enou!h time for ompliane( The han!es made to

these forms are not e%tensi5e as ompared to the earlier

years( %%%% 'fter onsideration of all fats, it has been deided

that the last date for filin! of returns due by 3th7eptember,

1. will not be e%tended( The ta%payers are ad5ised to file

their returns in time to a5oid last minute rush( #t was

submitted that prior to 8thugust, 2+1*, the relevant forms

were not e/enabled and made available to the assessees.

'herefore, the :uestion that arises for consideration is thatwhen the law provides for a period of 1


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available. #t was submitted that in the case of assessees who

are re:uired to file returns of income in forms #'R/1, #'R/2, #'R/

2, #'R/&7, the due date for filing return came to be etended

till 31stugust, 2+1* and there is no reason as to why such

benefit cannot be etended to the assessees who are re:uired

to file returns on income in -orms #'R/3, #'R/&, #'R/*, #'R/! and

#'R/8. #t was submitted that curtailing the period for filing the

ta returns by providing the utilities for filing the same at a

belated stage is not reasonable and is arbitrary. #t was

submitted that for 122 days, the forms were not available and

it is within the remainder period that the returns of income of

all the assessees belonging to the categories which are

re:uired to file returns in -orms #'R/3, #'R/&, #'R/*, #'R/! and

#'R/8, were re:uired to be filed. #t was, accordingly, urged that

the action of the respondents in not granting time for filing

income ta returns, being unreasonable and arbitrary,

necessary directions are re:uired to be issued to the firstrespondent Board to etend the period till 31st 5ovember,

2+1*.

< Aehemently opposing the petition, Mr. M. R. Bhatt, 7enior

dvocate, learned counsel for the respondents submitted that

the reliefs prayed for in the present petition reveal that the

same is more in the nature of a public interest litigation and

therefore, should have been filed by way of a public interest

litigation. #t was submitted that no cause of action of

infringement of any rticle of the "onstitution has been

brought to the notice of the court. #t was submitted that the

first petitioner which is a federation of professionals cannot, in

any manner, be said to be preudiced by the non/etension ofthe date for filing the income ta returns. #t was contended

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7eptember, 2+1* in C.(." 5o.)+32 of 2+1* wherein, the court

had dismissed a similar petition see$ing etension of due date

for filing the income ta returns. #t was submitted that the writ

petition has been filed without disclosing any cause of action

or infringement of fundamental rights.


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91*.8 .4 /T0 ., wherein it was observed that, Barring

some eceptions, it has been the general policy laid down by

this court in income ta matters that whatever our own view

may be, we should follow the view ta$en by another High "ourt

on the interpretation of a section4. #t was submitted that

therefore, once the 0elhi High "ourt has ta$en a view, it is not

permissible for this court to ta$e a different view.


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assessment year 2+1*/1! having the due date of 3+th

7eptember are concerned. 'he attention of the court was

further invited to the implications of business process, to

submit that any change in due date by way of etension has to

be given effect by change in return preparation software to

handle modification in interest under section 23&;23&B of the

ct. 7imilar changes have to be made in processing software to

calculate the refund accurately which re:uires substantial

changes to be made in business rules and which in turn also

delays the process of handling and processing of returns and

its conse:uential actions. #t was further submitted that on writ

petitions filed by various sta$e holders on this issue in their

respective urisdictional High "ourts li$e, 0elhi, ?arnata$a and

Raasthan High "ourts have not granted any relief to the

petitioners and therefore, in case, this court decides to allow

the petition pertaining to its urisdiction, thus deviating from

the stand of the "B0' and decisions of other High "ourts, itmay create anomalous situation in administering the #ncome

'a ct which is a "entral ct.


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Consultants Association v. Union of Indiarendered on 2


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without any evidence in support thereof, the (#E petitioners

shall have to be put to strict proof and cannot be allowed to

function as an etraordinary and etra/udicial ombudsmen

:uestioning the entire eercise underta$en by an etensive

body which include administrators, technocrats and financial

eperts. 'he court was of the considered view that this might

lead to a friction if not collision among the three organs of the

7tate and would affect the principle of governance engrained

in the theory of separation of powers. 'he decision of the

7upreme "ourt in the case of Federation of ail+ay

,fficers Association and others v. Union of India, 938

2 7CC *,was cited for the proposition that in eamining a

:uestion of the nature where a policy is evolved by the

=overnment, udicial review thereof is limited. Chen policy

according to which or the purpose for which discretion is to be

eercised is clearly epressed in the statute, it cannot be said

to be an unrestricted discretion. >n matters affecting policyand re:uiring technical epertise, the court would leave the

matter for decision of those who are :ualified to address the

issues. Fnless the policy or action is inconsistent with the

"onstitution and the laws or arbitrary or irrational or abuse of

power, the court will not interfere with such matters. Reliance

was also placed upon the decision of the 7upreme "ourt in the

case of Council of $cientific and Industrial esearch and

,thers v. amesh Chandra A-ra+al and another, 9*8

3 7CC 3., wherein the court had held that the 7tate is entitled

to fi a cut/off date. 7uch a decision can be struc$ down only

when it is arbitrary. #ts invalidation may also depend upon the

:uestion as to whether it has a rational neus with the obect

sought to be achieved. 'he "ourt observed that by choosing acut/off date, no illegality was committed. G/facie, it cannot be

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said to be arbitrary. Reliance was also placed upon the decision

of the 7upreme "ourt in the case of $tate of U. *. and

another v. &ohri #al, 928 2 7CC 412, with particular

reference to paragraphs 2< to 3+ thereof, for the proposition

that the scope and etent of power of the udicial review of the

High "ourt contained in rticle 22! of the "onstitution of #ndia

would vary from case to case, the nature of the order, the

relevant statute as also the other relevant factors including the

nature of power eercised by the public authorities, namely,

whether power is statutory, :uasi/udicial or administrative.

'he court observed that the limited scope of udicial review,

succinctly put, is %

i "ourts, while eercising the power of udicial review, do

not sit in appeal over the decisions of administrative

bodies6

ii petition for a udicial review would lie only on certainwell/defined grounds6

iii n order passed by an administrative authority eercising

discretion vested in it, cannot be interfered in udicial

review unless it is shown that eercise of discretion itself

is perverse or illegal6

iv mere wrong decision without anything more is not

enough to attract the power of udicial review6 the

supervisory urisdiction conferred on a "ourt is limited to

seeing that 'ribunal functions within the limits of its

authority and that its decisions do not occasion

miscarriage of ustice6

v 'he "ourts cannot be called upon to underta$e the

=overnment duties and functions. 'he "ourt shall notordinarily interfere with a policy decision of the 7tate.

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7ocial and economic belief of a udge should not be

invo$ed as a substitute for the udgment of the legislative

bodies.


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nature, it was submitted that unless the assessees $now about

the nature of the changes made, it is immaterial as to whether

the changes are minor or maor. #t was submitted that such a

contention could be available to the respondents provided the

old form was continued. However, till the new form was issued,

there was a total blac$out and it was not permissible for the

assessees to file their returns till the utility was made available

on 8thugust, 2+1*. s regards the contention that the statute

nowhere provides for 1


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which it is to be done, something in the conditions under which

it is to be done, something in the title of the persons for whose

benefit the power is to be eercised, which may couple the

power with a duty, and ma$e it the duty of the person in whom

the power is reposed to eercise that power when called upon

to do so. #t was submitted that the petitioners have a right as

assessees to believe that they would have enough time to file

their income ta returns. #t was submitted that the Board is

vested with powers coupled with a duty to eercise them,

when facts ustify.

).3 s regards the contention that necessary details with

regard to the number of assessees who have found it difficult

to submit the income ta returns before the due date having

not been made available, it was submitted that it is the

respondents who would $now as to how many persons have

filed returns. #t was submitted that the onus is cast upon therespondents to show that in spite of delay on their part, it is

possible to file the ta returns before the prescribed due date.

#t was submitted that the Board which is the authority which is

vested with the powers under section 11) of the ct to etend

the due date, has not eercised such powers, and therefore,

occasion has arisen for the petitioners to approach the court. #t

was submitted that the law epects the respondents to be

reasonable and that non/etension of the due date for filing

the income ta returns cannot in any manner be said to be

reasonable.

1+ s regards the contention that a "hartered ccountant

has in all to deal with !+ ta audits and corresponding income

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ta returns, and therefore, it cannot be said that the same

cannot be filed within seven wee$s, the attention of the court

was invited to the provisions of section 13) of the ct to point

out that insofar as !+ audits are concerned, the "hartered

ccountant is not re:uired to only deal with the assessees who

are subect to ta audit under section &&B of the ct. Chile

the number of assessees who are subect to ta audit under

section &&B of the ct may be limited to !+, there are various

other assessees in respect of whom the income ta returns

have to be filed. Reference was made to Gplanation 2 to

section 13) of the ct, which defines due date4, to point out

that the same provides that the due date for filing income ta

returns in respect of different categories of assessees.

Referring to sub/rule 1 of rule 12 of the #ncome 'a Rules,

1)!2 hereinafter referred to as the rules4, it was pointed out

that various categories of assessees and nature of forms are

prescribed therein. #t was submitted that the present petitiondoes not relate to the assessees covered under clauses a, b

and ca thereof. #t was pointed that in case of assessees

covered by clause c in relation to whom the -orm #'R/3 is

re:uired to be notified, are not subect to ta audit. 7imilar is

the case with the assessees covered by clauses d, f and g

who may be thousands in number. Fnder the circumstances,

the submission that a "hartered ccountant has to prepare ta

audit report and has to conduct only !+ ta audits and

correspondingly !+ income ta returns in respect of which the

period of seven wee$s is sufficient, clearly disregards the other

assessees in relation to whom also the utility was made

available only with effect from 8th ugust, 2+1*. #t was

submitted that thus, the relevant forms for e/filing of returnswere earlier prescribed only in case of the assessees falling

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under clauses a, b and ca, namely, the assessees having

salary income, etc. #t was submitted that maority of the

assessees fall in categories in whose cases utility for filing the

returns was provided only on 8thugust, 2+1*. therefore, the

view advanced on behalf of the Board is not in consonance

with the provisions of the ct and the rules and the Board has

failed to appreciate the 7cheme of the ct and the rules and

therefore, the argument that income ta returns could be filed

within the limited period of seven wee$s is e/facie bad.

1+.1 s regards the contention that it is not permissible for

the court to ta$e a different view from that adopted by the

0elhi, it was submitted that the :uestion involved in the

petition does not involve interpretation of a statutory provision.

'he attention of the court was also invited to the decision of

this court in the case of . . *aper 0oard %imited v.

Deputy Commissioner of Income Tax, 91**8 32 /T0 433,wherein the court after considering the decision of the Bombay

High "ourt in the case of ;ane"lal Chunilal and 7ons


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1+.& 'he learned counsel also invited the attention of the

court to the decision of the (unab and Haryana High "ourt in

the case of 1ishal Gar- and others v. Union of India and

anotherrendered today, that is, on 2) th7eptember, 2+1* in

"C( 5o.1)88+ of 2+1*, wherein the court, after considering

the totality of the facts of the case and after considering the

decisions of the Raasthan High "ourt, 0elhi High "ourt, has

considered it appropriate to etend the date for e/filing of

returns upto 31st>ctober, 2+1*.

1+.* s regards the contention based upon the above

referred decisions of the 7upreme "ourt that in a matter of

policy decision, this court would not interfere, the learned

counsel reiterated the proposition of law laid down by the

7upreme "ourt in the case of %. irday arain v. Income

Tax ,fficer/ 0areillysupra, to submit that when there is a

power coupled with duty, there is an obligation on the

respondents to eercise the same if the facts so warrant. s

regards the decisions on which reliance had been placed by

the learned counsel for the revenue, it was submitted that in

those decisions, the =overnment did not owe any obligation.

Besides, the issue involved in the present case does not relate

to economic policy and is a simple issue of failure to eercisediscretion where the facts ustify eercise of such discretion. #t

was, accordingly, urged that the decision of the Board not to

etend the due date for filing return of income, suffers from

the vice of legal mala fides.

11. Mr. Bhatt, learned counsel for the respondents in

response to the contention that there are several other

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categories of assessees than those who are subect to ta

audit, submitted that in case of all other assessees, only

details are re:uired to be punched in the prescribed forms and

therefore, no case of hardship has been made out. #t was also

urged that ust because the petitioners have come to the court,

is no reason to grant them relief.

11 'he controversy involved in the present case lies in a

very narrow compass. 'he petitioners and other assessees

covered under the categories to which the petition relates, are

ordinarily re:uired to file their returns of income any time from

1stpril till 3+th7eptember of the relevant assessment year. By

virtue of rule 12 of the rules, all the assessees have to file the

income ta returns electronically, that is, online. -or this

purpose, the corresponding utility relating to each category of

assessees in the nature of -orms 5o.#'R/3, #'R/&, #'R/*, #'R/!

and #'R/8 are re:uired to be provided by the respondents. #t isan admitted position that in the year under consideration, the

relevant utility has been provided only with effect from 8th

ugust, 2+1*. 'herefore, prior to 8thugust, 2+1*, it was not

possible for any of the assessees who were re:uired to file

income ta returns in the above referred forms, to file their

returns of income. 'herefore, while in the ordinary course, the

assessees falling in the above categories have a period of 1


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for eercising powers under section 11) of the ct and

etending the due date for filing the income ta returns

prescribed under Gplanation 2 to section 13) of the ct.

However, by the announcement dated )th 7eptember, 2+1*,

such re:uest has been turned down and it has been stated

that the last date for filing of returns being 3+th 7eptember,

2+1* will not be etended. s noticed hereinabove, in case of

other categories of assessees who are re:uired to file ta

returns in -orm #'R/1, #'R/2, #'R/2, #'R/&7, in whose case also,

there was a delay in furnishing the necessary utility, the Board

had etended the due date for filing the income ta returns.

'he stand of the Board is that the period of seven wee$s which

is available to the petitioner and other assessees for filing

online income ta returns, is sufficient and therefore, there is

no reason for etending the due date for filing the income ta

returns.

12. Chile it is true that the powers under section 11) of the

ct are discretionary in nature and it is for the Board to

eercise such powers as and when it deems fit. However, it is

e:ually true that merely because such powers are

discretionary, the Board cannot decline to eercise such

powers even when the conditions for eercise of such powers

are shown to eist. t this uncture reference may be made to

the decision of the 7upreme "ourt in the case of UC, 0ank v.

CIT, 91***8 2 7CC .**91***8 34 /T0 *, wherein the court

had occasion to interpret section 11) of the ct. 'he court held

thus%

23.@hat is the status of these irularsA 7etion 11*918

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of the /nome Ta% 't, 1*1 pro5ides that:

11*( 918 The Central ?oard of 6iret Ta%es may, from

time to time, issue suh orders, instrutions and diretions

to other /nome Ta% 'uthorities as it may deem fit for the

proper administration of this 't, and suh authorities and

all other persons employed in the e%eution of this 't shall

obser5e and follow suh orders, instrutions and diretions

of the ?oard:

>ro5ided that no suh orders, instrutions or diretions

shall be issuedB

9a8 so as to re&uire any /nome Ta% 'uthority to ma"e a

partiular assessment or to dispose of a partiular ase in a

partiular manner or

9b8 so as to interfere with the disretion of the 'ppellate

'ssistant Commissioner in the e%erise of his appellate

funtions(

9emphasis supplied8

$nder sub-setion 98 of 7etion 11*, without preDudie to

the !enerality of the ?oards power set out in sub-setion

918, a speifi power is !i5en to the ?oard for the purpose of

proper and effiient mana!ement of the wor" of assessment

and olletion of re5enue to issue from time to time !eneral

or speial orders in respet of any lass of inomes or lassof ases settin! forth diretions or instrutions, not bein!

preDudiial to assessees, as the !uidelines, priniples or

proedures to be followed in the wor" relatin! to

assessment( 7uh instrutions may be by way of rela%ation

of any of the pro5isions of the setions speified there or

otherwise( The ?oard thus has power, inter alia, to tone

down the ri!our of the law and ensure a fair enforement of

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its pro5isions, by issuin! irulars in e%erise of its statutory

powers under 7etion 11* of the /nome Ta% 't whih are

bindin! on the authorities in the administration of the 't(

$nder 7etion 11*989a8, howe5er, the irulars as

ontemplated therein annot be ad5erse to the assessee(

Thus, the authority whih wields the power for its own

ad5anta!e under the 't is !i5en the ri!ht to fore!o the

ad5anta!e when re&uired to wield it in a manner it

onsiders Dust by rela%in! the ri!our of the law or in other

permissible manner as laid down in 7etion 11*( The power

is !i5en for the purpose of Dust, proper and effiient

mana!ement of the wor" of assessment and in publi

interest( /t is a benefiial power !i5en to the ?oard for

proper administration of fisal law so that undue hardship

may not be aused to the assessee and the fisal laws may

be orretly applied( Hard ases whih an be properly

ate!orised as belon!in! to a lass, an thus be !i5en thebenefit of rela%ation of law by issuin! irulars bindin! on

the ta%in! authorities(

13. 'hus, the power under section 11) of the ct is a

beneficial power given to Board for proper administration of

fiscal law so that undue hardship may not be caused to theassessee and the fiscal laws may be correctly applied. #n the

case at hand, as is evident from the facts noted hereinabove,

in the normal course, assessees who are subect to audit as

well as other categories of assessees referred to hereinabove,

can file their returns of income from 1stpril to 3+th7eptember

of the year in :uestion. #n view of the provisions of rule 12 of

the rules, whereby, the assessees who are subect to ta audit,

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as well as the assessees referred to hereinabove, are re:uired

to file the ta returns electronically, that is, online. However,

for filing the ta returns, appropriate utility is re:uired to be

made available by the respondents to the assessees.

'herefore, till such utility is provided by the respondents, it is

not possible for the assessees to file their returns of income.

'herefore, there is a duty cast upon the respondents to ensure

that necessary utility for e/filing of the income ta returns is

made available to various categories of assessees at the

beginning of the assessment year so that the assessees can

plan their ta matters accordingly. However, as noted

hereinabove, the utilities for e/filing of returns have been made

available only with effect from 8th ugust, 2+1*, thereby

curtailing the time available for filing the income ta returns to

a great etent. ccording to the petitioners, such curtailment

of time causes immense hardship and preudice to the

petitioners and other assessees belonging to the abovecategories, whereas the respondent Board, on the other hand,

has ta$en an adamant stand not to etend the time for e/filing

of the returns despite the fact that the entire situation has

arisen on account of default on the part of the 0epartment and

not the assessees.

1&. #t may be recalled that in relation to assessment year

2+1&/1*, the respondent Board had etended the time for

filing the ta audit reports, but had not etended the time for

filing the returns and the petitioners were constrained to

approach this court for etension of the due date for filing

return of income. #n that case, this court has, inter alia,

observed thus %

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.( @e are also atuated by the fat that the entire

situation is arisin! not on aount of any ontribution on

the part of either the professionals or the assesses leadin!

to suh a situation( /n the present ase, with the

ad5anement of the tehnolo!y, it is always ommendable

that the department ta"es reourse to the tehnolo!y

more and more( @ith the possible defets ha5in! been

found in utility software in use in the pre5ious year, the

re&uired han!es in the larifiation or the new format of

suh utility, if brou!ht to the fore, the same would be

desirable( 't the same time, the omplete bla" out for

nearly a months time would not allow aessibility to suh

utility software to the assessees, whih has put them to a

!reat Deopardy(

.3( The C?6T deri5es its powers under the statute

whih enDoins upon the ?oard to issue from time to timesuh orders, instrutions and diretions to other inome-

ta% authorities if found e%pedient and neessary for proper

administration of the 't( @ithout preDudie to the

!enerality of powers pro5ided under sub-setion 918 of

setion 11* of the 't, the C?6T also has speifi powers

to pass !eneral or speial orders in respet of any lass or

lass of ases by way of rela%ation of any of the pro5isions

of setion, whih also inludes setion 13* of the 't( /f

the ?oard is of the opinion that it is neessary in the publi

interest to so do it( #or a5oidin! the !enuine hardship in

any ase or lass of ases, the C?6T if onsiders desirable

and e%pedient, by !eneral or speial order, it an issue

suh orders, instrutions and diretions for properadministration of this 't( 'll suh authorities en!a!ed in

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e%eution of the 't are e%peted to follow the same( 'ny

re&uirement ontained in any of the pro5isions of Chapter

/E or Chapter E/' also an be rela%ed by the C?6T for

a5oidin! !enuine hardship in any ase or lass of ases by

!eneral or speial orders( This pro5ision, therefore, !i5es

5ery wide powers to the C?6T to pass !eneral or speial

orders whene5er it deems it neessary or e%pedient to so

do it in respet of any lass of inome or lass of ases( /t

has not only to see the publi interest for so doin!, but

also for a5oidin! the !enuine hardship in any partiular

ase or lass of ases, suh powers an be e%erised(

.2( 0e5ertin! to the matters on hand, a 5ery peuliar

situation has arisen portrayin! the !enuine hardship to the

assessee, as also to the ta% onsultants, by way of

representations made to the ?oard, it would ha5e been

desirable and e%pedient on the part of the C?6T to ha5eonsidered suh re&uest and e%erise the powers by way

of a rela%ation( @hat all that has been sou!ht is to ma"e

the due date for filin! the ta% return harmonious with the

filin! of the T'0 and without DeopardiFin! the issue of

olletion of ta%, it was not impossible to e%erise suh

powers of rela%ation of pro5ision presribin! e%tension of

the due date(

..( @hile e%aminin! the C?6TGs powers e%erisable

under setion 11* of the 't, of ourse, in some other

onte%t, the 'pe% Court has held and obser5ed thus:

*( @hat is the status of these irularsA 7etion 11*918 ofthe /nome-ta% 't, 1*1 pro5ides that, The Central

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?oard of 6iret Ta%es may, from time to time, issue suh

orders, instrutions and diretions to other /nome-ta%

authorities as it may deem fit for the proper administration

of this 't and suh authorities and all other persons

employed in the e%eution of this 't shall obser5e and

follow suh orders, instrutions and diretions of the

?oard( >ro5ided that no suh orders, instrutions or

diretions shall be issued 9a8 so as to re&uire any /nome-

ta% authority to ma"e a partiular assessment or to

dispose of a partiular ase in a partiular manner: or 9b8

so as to interfere with the disretion of the 'ppellate

'ssistant Commissioner in the e%erise of his appellate

funtions( $nder sub-setion 98 of 7etion 11* without

preDudie to the !enerality of the ?oardGs power set out in

sub-setion 918 a speifi power is !i5en to the ?oard for

the purpose of proper and effiient mana!ement of the

wor" of assessment and olletion of re5enue to issuefrom time to time !eneral or speial orders in respet of

any lass of inomes or lass of ases settin! forth

diretions or instrutions, not bein! preDudiial to assesses,

as the !uidelines, priniples or proedures to be followed

in the wor" relatin! to assessment( 7uh instrutions may

be by way of rela%ation of any of the pro5isions of the

setions speified there or otherwise( The ?oard thus has

power, inter alia, to tone down the ri!or of the law and

ensure a fair enforement of its pro5isions, by issuin!

irulars in e%erise of its statutory powers under 7etion

11* of the /nome-ta% 't whih are bindin! on the

authorities in the administration of the 't( $nder 7etion

11*989a8 howe5er, the irulars as ontemplated thereinannot be ad5erse to the assessee( Thus, the authority

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whih wields the power for its own ad5anta!e under the

't is !i5en the ri!ht to for!o the ad5anta!e when

re&uired to wield it in a manner it onsiders Dust by

rela%in! the ri!our of the law or in other permissible

manners as laid down in 7etion 11*( The power is !i5en

for the purpose of Dust, proper and effiient mana!ement

of the wor" of assessment and in publi interest( /t is a

benefiial power !i5en to the ?oard for proper

administration of fisal law so that undue hardship may

not be aused to the assessee and the fisal laws may be

orretly applied( Hard ases whih an be properly

ate!orised as belon!in! to a lass, an thus be !i5en the

benefit of rela%ation of law by issuin! irulars bindin! on

the ta%in! authorities(

..(1 Thus as held by the 'pe% Court the powers !i5en to

the ?oard are benefiial in nature to be e%erised forproper administration of fisal law so that undue hardship

may not be aused to the ta%payers( The purpose is of

Dust, proper and effiient mana!ement of the wor" of

assessment and the publi interest(

.( Conse&uenes that would follow on aount of the

delay in filin! the return of inome also are wei!hin!

fators for the Court to onsider suh re&uest( ?ein!

onsious of the fat that the writ of mandamus, whih is

hi!hly prero!ati5e writ is for the purpose of ompellin! the

authorities of any offiial duties, offiially har!ed by the

law either refuses or fails to perform the same, the writ of

mandamus is re&uired to be used for the publi purpose,partiularly, when the party has not other remedy

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a5ailable( /t is essentially desi!ned to promote Dustie(

( Ieepin! in mind the sope of writ Durisdition as

detailed in the deision hereinabo5e, these petitions

deser5e onsideration( /n absene of any remedy

a5ailable, muh less effeti5e to the sta"eholders a!ainst

the non-use of benefiial powers by the ?oard for the

lar!er ause of Dustie, e%erise of writ Durisdition to meet

the re&uirements of irumstanes has beome ine5itable(

( 7uh e%tension needs to be !ranted with the

&ualifiation that the same may not result into non-

har!in! of interest under setion 32'( 7imply put, while

e%tendin! the period of filin! of the ta% return and

!rantin! benefit of suh e%tension for all other pro5isions,

interest har!ed under setion 32' for late filin! of return

would be still permitted to be le5ied, if the ?oard sohoses for the period ommenin! from 1(1(12 to the

atual date of filin! of the return of inome( Those ta%

payers o5ered under these pro5isions if hoose to pay the

amount of ta% on or before the 3th7eptember, 12, no

interest in any ase would be le5ied despite their filin! of

return after the 3th7eptember, 12(

2( @e are not inlined to stay new utility for one year

as suffiient measures are already ta"en by the ?oard to

redress this !rie5ane( Howe5er, it needs to be obser5ed

at this Dunture that any introdution or new

utility+software with additional re&uirement in the middle

of the year ordinarily is not desirable( 'ny han!e unlessine5itable an be planned well in ad5ane, "eepin! in

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fous that suh omprehensi5e proess re-en!ineerin!

may not result in undue hardship to the sta"eholders for

whose benefit the same operates(

4( ?esides, no !ra5e preDudie would be aused to the

re5enue if the due date for filin! the return of inome is

also e%tended till the date of filin! of the ta% audit report,

whereas the assessee would be 5isited with serious

onse&uenes as referred to hereinabo5e in ase of non-

filin! of return of inome within the presribed period as

he would not be in a position to laim the benefit of the

pro5isions referred to hereinabo5e( The apprehension

5oied by the re5enue that in ase due date for filin!

return of inome is e%tended, due date for self-assessment

also !ets automati e%tension, resultin! into delay in

olletion of self-assessment ta% whih is otherwise

payable in 7eptember, 12, an be ta"en are of bypro5idin! that the due date shall stand e%tended for all

purposes, e%ept for the purposes of J%planation 1 to

setion 32' of the 't(

1*. #t may be noted that despite the fervent hope epressed

by the court that the respondents in future may plan any

change well in advance, a similar situation has prevailed in the

present year also and the utilities for e/filing of income ta

returns have been made available as late as on 8 th ugust,

2+1*, leaving the petitioners and other assessees with less

than one third of the time that is otherwise available under the

statute.

1!. #t may be noted that in the facts of the above case, there

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was a blac$out for a period of one month, whereas in the year

under consideration, the utility was not made available till 8 th

ugust, 2+1*. 'hus, it was not possible for any of the

assessees who are re:uired to file returns in -orms 5o.#'R/3,

#'R/&, #'R/*, #'R/! and #'R/8, to file income ta returns before

such date.

18. nother notable aspect of the matter is that as

contended on behalf of the petitioners, non/filing of returns

before the due date would result into the assessees being

deprived of their right to file the revised return or claiming

loss, whereas insofar as the revenue is concerned, no hardship

or preudice is li$ely to be caused, inasmuch as the interest of

the revenue can be ta$en care of by providing that the due

date shall stand etended for all purposes, ecept for the

purposes of Gplanation 1 to section 23& of the ct. Fnder

the circumstances, when no preudice is caused to the revenueand the assessees are put to great hardship on account of the

short period within which the income ta returns are to be

filed, it was epected of the Board to eercise the discretionary

powers vested in it under section 11) of the ct to ameliorate

the difficulties faced by the assessees on account of no default

on their part, at least to a certain etent, by etending the due

date for filing the income ta returns for a reasonable time. #n

the opinion of this court, the Board should not create a

situation whereby the assessees are re:uired to $noc$ the

doors of the court year after year, more so, when on account

of the delay on the part of the respondents, it is the assessees

who would have to face the conse:uences of not filing the

returns in time. 'he contention that no preudice is caused tothe petitioners;assessees, therefore, does not merit

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acceptance.

1ctober, 2+1* so as to alleviate

to a certain etent, the hardships caused to the assessees on

account of delay in providing the utilities.

1). 7ignificantly, one of the factors which appears to have

weighed with the Board while turning down the re:uest for

etension of the due date for filing returns is that as per the

guidelines of #"#, a practicing "hartered ccountant, as an

individual or as a partner of a firm, can conduct only upto sity

ta audits under section &&B of the ct and corresponding

number of ta returns are re:uired to be filed, in respect of

which, the seven wee$s available to them should be sufficient.

#n this regard it may be germane to refer to rule 12 of the

rules, which prescribes the different forms under which

assessees belonging to various categories enumeratedthereunder are re:uired to file their returns. "lause c of sub/

rule 1 of rule 12 prescribes -orm 5o.#'R/3 in case of a person

being an individual or Hindu Fndivided family who is a partner

in a firm and where income chargeable to income/ta under

the head (rofits and gains of business and profession4 does

not include any income ecept the categories enumerated

therein. "lause d of rule 121 prescribes -orm 5o. #'R/& in

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the case of a person being an individual or a Hindu undivided

family or other than the individual or Hindu undivided family

referred to in clause a or b or c or ca deriving income

from a proprietory business or profession. "lause e prescribes

-orm 5o. #'R/* in the case of a person not being an individual

or a Hindu undivided family or a company or a person to which

clause g applies. "lause f prescribes -orm 5o. #'R/! in the

case of a company not being a company to which clause g

applies and clause g prescribes -orm 5o.#'R/8 in the case of

a person including a company whether or not registered under

section 2* of the "ompanies ct, 1)*! which is re:uired file

return under the relevant sub/sections of section 13) of the

ct mentioned thereunder. 5ot all the aforesaid classes of

assessees are re:uired to be audited under section &&B of

the ct. 'herefore, it is not ust assessees who are subect to

ta audit under section &&B of the ct who are affected by

the non/etension of due date but assessees belonging to allthe above categories who may not be subect to ta audit

under section &&B. 'he number of ta audits conducted by a

"hartered ccountant may be limited to !+, but the total

number of assessees that he deals with is not limited to !+, as

a large number of assessees may belong to the categories

which are not subect to ta audit under section &&B of the

ct.

2+. 'he Board while not etending the due date for filing

return was also of the view that due date should not be

etended ust for the benefit of those who have remained la

till now for no valid reason in discharging their legal

obligations. #t may be noted that despite the fact thatordinarily the #'R -orms which should be prescribed and made

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available before the 1stof pril of the assessment year, have in

fact, been made available only on 8thugust, 2+1* and the

assessees are given only seven wee$s to file their ta returns.

'herefore, laity, if any, evidently is on the part of the

authority which is responsible for the delay in ma$ing the

utility for G/-iling the return being made available to the

assessees. Chen the default lies at the end of the

respondents, some grace could have been shown by the Board

instead of ta$ing a stand that such a trend may not be

encouraged. Had it not been for the laity on the part of the

respondents in providing the utilities, there would not have

been any cause for the petitioners to see$ etension of the

due date for filing ta returns.

21. s regards the decision of the 0elhi High "ourt on which

reliance has been placed by the learned counsel for the

petitioners, it may be noted that the learned 7ingle udge hasobserved that the claim of the petitioners that it is entitled to

1


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court in paragraph 22 of the udgment has epressed the view

that there is some merit, if not legal then otherwise, in the

grievance of the petitioner. 'he court noticed that the counsel

for the respondents was unable to give reasons for the forms

etc. not being available at the beginning of the assessment

year on 1stpril of every year and the same thereby causes

inconvenience to the practitioners of the subect. 'he court

further observed that there is sufficient time available to the

=overnment, after the -inance ct of the financial year, to

finalise the forms and if no change is intended therein, to

notify the same immediately. 'he court found no ustification

for delay beyond the assessment year in prescribing the said

forms. ccordingly, while not granting relief to the petitioner

for the current assessment year, the court directed the

respondents to, with effect from the net assessment year, at

least ensure that the forms etc. which are prescribed for the

udit Report and for filing the #'R are available as on 1st

prilof the assessment year unless there is a valid reason therefor

and which should be recorded in writing by the respondents

themselves, without waiting for any representations to be

made. 'he court further observed that the respondents, while

doing so, to also ta$e a decision whether owing thereto any

etension of the due date is re:uired to be prescribed and

accordingly notify the public.

22. s regards the decision of the ?arnata$a High "ourt, the

court has merely relegated the petitioners therein to the "B0'

for the consideration of their representation and does not lay

down any proposition of law. 'he Raasthan High "ourt has

epressed the view that the decision contained in theannouncement dated )th 7eptember, 2+1* being a policy

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decision, the court should not interfere. 'he court, therefore,

has not considered the non/eercise of discretionary powers

under section 11) of the ct on the part of the Board despite

the fact that the circumstances so warrant eercise of

discretion in favour of the assessee.

23. 'he (unab and Haryana High "ourt in the case of Aishal

=arg v. Fnion of #ndia supra has, having regard to the totality

of facts and circumstances of the case, considered it

appropriate to etend the due date for e/filing of returns upto31st>ctober, 2+1*. 'herefore, instead of etending the due

date to 3+th5ovember as prayed for in the petition, with a

view to maintain consistency in the due date for e/filing of

returns, this court is of the view that, the same date is re:uired

to be adopted.

2&. 'he contention that once the 0elhi High "ourt has ta$en

a particular view, in relation to an all #ndia statute, it is not

permissible for this court to ta$e a different view, does not

merit acceptance in the light of the view ta$en by this court in

5 R (aper Board Eimited v. 0eputy "ommissioner of #ncome

ta supra. Besides, even if such contention were to be

accepted, there are conflicting decisions of different High

"ourts, inasmuch as, the (unab and Haryana High "ourt has

ta$en a view different from the 0elhi High "ourt and hence, it

is permissible for the court to adopt the view with which it

agrees.

2*. #n the light of the above discussion, the petition partly

succeeds and is accordingly allowed to the following etent.

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'he respondent Board is hereby directed to forthwith issue

re:uisite notification under section 11) of the ct etending

the due date for e/filing of the income ta returns in relation to

the assessees who are re:uired to file return of income by 3+ th

7eptember, 2+1* to 31st>ctober, 2+1*. 'he respondents shall

henceforth, endeavour to ensure that the forms and utilities for

e/filing of income ta returns are ordinarily made available on

the 1st day of pril of the assessment year. Rule is made

absolute to the aforesaid etent with no order as to costs.

(HARSHA DEVANI, J.)

(A.G.URAIZEE,J)parmar*

Documents

Income Tax Return - Gujarat High Court