Pointing out that Section 119(2)(b) of the Income Tax Act is meant for the redressal of the grievance and hardships caused to the taxpayer, the Gujarat High Court (Ahmedabad Bench) directed the Revenue Department to permit the herbal product manufacturer (petitioner) to file a fresh Form 10-IC and condone the delay in filing such Form by moulding the prayer made by the petitioner to treat the belated Form 10IC as that of for the relevant Assessment Year.
The above relaxation was offered to the petitioner by the Division Bench of Justice Bhargav D. Karia and Justice Pranav Trivedi, observing that the provisions of Section 115BAA are in a way granting relief to the taxpayer companies to enable them to pay the reduced rate of tax at the rate of 22% on exercise of the option on the various conditions mentioned therein.
Briefly, the petitioner, while filing its return u/s 139(1) declaring total income of Rs. 1.16 lacs, had exercised the option u/s 115BAA to pay the reduced rate of tax at 22% excluding the surcharge & education cess. It was the petitioner’s case that even though the requirement of filing of Form 10-IC is on or before the filing due date of the return u/s 139(1), the Central Board of Direct Tax (CBDT), vide its circular dated 06/2022 has condoned the delay in filing the Form 10-IC till June 30, 2022. However, due to an inadvertent error, Form 10-IC was filed after two and a half months of the stipulated date, and realizing that the benefit of concessional tax was not accorded, owing to a bona fide mistake attributable to it, the petitioner sought condonation of delay u/s 119(2)(b), which came to be rejected.
When the matter reached the High Court, it was found that the CBDT, in order to avoid the genuine hardships to the domestic companies while exercising the option u/s 115BAA to seek concessional tax upon fulfilling the three conditions, had issued a Circular extending the date of claiming such benefit. Since the petitioner failed to file Form 10-IC before the specified date as per the Circular due to a genuine mistake of its CA, it had to approach the CBDT to consider the belated Form 10-IC for Sec 115BAA benefits. Accordingly, the High Court allowed the petition in favour of the petitioner by permitting them to obtain Form 10IC.
Appearances:
Advocate Krutarth K Desai, for the Petitioner
Advocate Karan G Sanghani, for the Respondent
