Kerala High Court
Kerala Building And Other ... vs Union Of India on 16 October, 2023
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR. JUSTICE DINESH KUMAR SINGH
MONDAY, THE 16TH DAY OF OCTOBER 2023 / 24TH ASWINA, 1945
WP(C) NO. 29554 OF 2023
PETITIONER:
KERALA BUILDING AND OTHER CONSTRUCTION WORKERS
WELFARE BOARD, NIRMAN BHAVAN, METTUKKADA,
THYCADU P. O., THIRUVANANTHAPURAM, PIN - 695014,
REPRESENTED BY ITS SECRETARY.
BY ADVS.
SRI. KURYAN THOMAS
SRI. M. GOPIKRISHNAN NAMBIAR
SRI. K. JOHN MATHAI
SRI. JOSON MANAVALAN
SRI. PAULOSE C. ABRAHAM
SRI. RAJA KANNAN
RESPONDENTS:
1 UNION OF INDIA,
REPRESENTED BY ITS REVENUE SECRETARY,
MINISTRY OF FINANCE, NEW DELHI, PIN - 110004.
2 COMMISSIONER OF INCOME TAX (EXEMPTION),
AAYKAR BHAVAN, OLD RAILWAY STATION ROAD,
KOCHI, PIN - 682018.
3 THE ASSISTANT COMMISSIONER OF INCOME TAX,
EXEMPTION CIRCLE, AAYKAR BHAVAN, 1ST FLOOR,
KAWADIYAR P. O., THIRUVANANTHAPURAM, PIN - 695003.
4 THE CENTRALIZED PROCESSING CENTER,
INCOME TAX DEPARTMENT, REPRESENTED BY DEPUTY
COMMISSIONER OF INCOME TAX, POST BAG NO.2,
ELECTRONIC CITY POST OFFICE, BANGALORE, PIN - 560500.
5 THE CENTRAL BOARD OF DIRECT TAXES,
REPRESENTED BY ITS CHAIRPERSON,
DEPARTMENT OF REVENUE-MINISTRY OF FINANCE,
NEW DELHI,PIN - 110001.
6 THE COMMISSIONER OF INCOME TAX (APPEALS),
NATIONAL FACELESS APPEAL CENTRE, DELHI,
WP(C) NO. 29554 OF 2023
2
C-BLOCK, 4TH FLOOR, S.P. M. CIVIC CENTER,
NEW DELHI, PIN - 110001.
BY ADV.
SRI. CHRISTOPHER ABRAHAM - SC
THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION
ON 16.10.2023, THE COURT ON THE SAME DAY DELIVERED THE
FOLLOWING:
WP(C) NO. 29554 OF 2023
3
DINESH KUMAR SINGH, J.
--------------------------
W.P.(C) No.29554 of 2023
-------------------------
Dated this the 16th day of October, 2023
JUDGMENT
1. The present writ petition has been filed by the petitioner for
the following reliefs;
(i) call for the records relating to Exts. P5, P11, P16
and P20 Orders and Ext. P22 Notice, issued to the
petitioner, and quash the same in for as it relates to
the Assessment Year 2014-15, by the issuance of a writ
of certiorari or such other writ, order or direction;
(ii) issue of writ of mandamus or such other order,
writ or direction, commanding the 2 nd respondent to
forbear from taking further steps against the petitioner
on the basis of Exts. P5, P11, P16 and P20 orders and
Ext. P22 Notice in for as it relates to the Assessment
Year 2014-15;
(iii) grant such other identical reliefs as this
Honourable Court may deem fit and necessary on the
facts and circumstances of this case.
2. The petitioner is a fund established by the State Government
under Part V (Chapter XXXI) of the Building and Other Construction
Workers (Regulation of Employment and Condition of Service)
Kerala Rules, 1998. The fund has been established by the petitioner
WP(C) NO. 29554 OF 2023
Board to look after the welfare of building and other construction
workers in the State of Kerala. Petitioner is an assessee under the
provisions of the Income Tax Act, 1961. The petitioner has been
approved as a fund falling under Section 10 (23C) (iv) of the Income
Tax Act by the Chief Commissioner of Income Tax,
Thiruvananthapuram and has been issued order in Exhibit P-1 dated
18.08.2010. The petitioner filed return of its income for the
assessment year 2014-15 declaring NIL taxable income. After filing
the return, on 08.10.2015 the petitioner received a notice under
Section 139 (9) of the Income Tax Act informing that the return filed
by the petitioner was defective one. It was said that the details of
the fund was not property filled up in Schedule - J of the return of
income. The petitioner responded to the said notice and filed fresh
return incorporating the Schedule - J. The petitioner's return was
scrutinized and entire income of the petitioner was assessed to tax
without considering the exemption available to the petitioner under
Section 10 (23C) (iv) of the Income Tax Act. The petitioner filed
rectification application on 03.01.2017. During the rectification
proceedings, the petitioner was informed orally that audit report
filed by the petitioner along with the return in Form No.10B as
against From No.10BB. On receiving the said information, the
WP(C) NO. 29554 OF 2023
petitioner filed audit report in Form No.10BB. However the
contents of the earlier audit report and the subsequent audit report
filed in From No.10B and Form No.10BB respectively were one and
the same. The 3rd respondent however rejected the application for
rectification under Section 154 of the Income Tax Act on the ground
that the rectification could have been considered only if the delay in
Form No.10BB was condoned by the Commissioner of Income Tax as
provided under Section 119 (2) (b) of the Income Tax Act. After
receiving the Exhibit P-11 order dated 15.11.2021, the petitioner
preferred an application before the 2nd respondent requesting for
condone the delay in filing the audit report in Form No.10BB. The
Commissioner of Income Tax vide Exhibit P-16 order dated
06.09.2022 found the reasons stated by the petitioner for delay in
filing the the audit report in Form No.10BB is genuine and stake
bonafide mistake. However, relying on the CBDT Circular 9/2015
dated 09.06.2015 was of the opinion that condonation application
dated 21.12.2021 was barred by limitation of six years. As the
refund in the case was more than Rs.10,000,00/- (Rupees Ten Lakh
only) and therefore it was beyond the power of the Commissioner
of Income Tax to condone the delay in filing the audit report in Form
No.10BB.
WP(C) NO. 29554 OF 2023
3. The Learned Counsel for the petitioner submits that the 2 nd
respondent Commissioner has placed reliance on the wrong Circular
(Exhibit P-17), which is in respect of refund of the loss. He submits
that the correct Circular is Exhibit P-18 Circular No.19/2020 dated
03.11.2020, which is in respect of delay in submitting audit report in
Form No.10BB. Learned Counsel for the petitioner submits that
Exhibit P-18 Circular dated 03.11.2020 provides that in all cases of
belated applications in filing of Form No.10BB for years prior to
assessment years 2018-19, the Commissioner of Income Tax is
authorised to admit such such applications for condonation of delay
under Section 119 (2) (b) of the Act. The said Circular does not
provide any limitation of time for preferring the application for
condonation of delay in respect of filing in Form No.10BB for the
assessment years prior to 2018-19. He further submits that the said
Circular has been reiterated in Circular No.15/2022. It is therefore
submitted that the order impugned in Exhibit P-16 is liable to be set
aside and the matter may be remanded back to the jurisdictional
Commissioner to apply the correct Circular and pass a fresh order.
4. Mr. Christopher Abraham, Learned Standing Counsel for the
Revenue does not disputed that the correct Circulars are Circular
WP(C) NO. 29554 OF 2023
No.19/2020 dated 13.11.2020 (Exhibit P-18) and Circular No.15/2022
dated 19.07.2022 (Exhibit P-19). Exhibits P-18 and P-19 Circulars has
been issued specifically in respect of condoning the delay in filing in
Form No.10BB under Section 119 (2) (b) of the Income Tax Act.
Paragraph 3 of Circular No.19/2020 dated 13.11.2020 on
reproduction read as under;
"4. Accordingly, with a view to expedite the disposal
of applications filed by such entities for condoning the
delay and in exercise of the powers conferred under
section I 19(2) (b) of the Act, the Central Board of
Direct Taxes hereby directs that:
(i) In all the cases of belated applications in filing of
Form No. 10BB for years prior to AY. 2018-19, the
Commissioners of Income-tax are authorized to admit
such applications for condonation of delay u/s 119(2)(b)
of the Act. The Commissioner will while entertaining
such applications regarding filing Form No. 10BB shall
satisfy themselves that the applicant was prevented by
reasonable cause from filing such application within the
stipulated time. Further, all such applications shall be
disposed of by 31.03.2021.
(ii) where there is delay of upto 365 days in filing Form
No. 10BB for Assessment Year 2018-19 or for any
subsequent Assessment Years, the Commissioners of
Income-tax are hereby authorized to admit such belated
applications of condonation of delay under section
WP(C) NO. 29554 OF 2023
119(2) of the Income-tax Act, 1961 and decide on
merits."
5. Considering these circumstances, it appears that the
Commissioner has committed mistake relying on Exhibit P-17
Circular 9/2015 dated 09.06.2015 instead of Circular No.19/2020
dated 13.11.2020 (Exhibit P-18) and Circular No.15/2022 dated
19.07.2022 (Exhibit P-19). Thus the present writ petition is allowed
and the matter is remitted back to the 2nd respondent Commissioner
to decide the application of the petitioner afresh by applying the
correct Circular and pass fresh order.
6. Till a decision is taken by the Commissioner on remand,
recovery notice Exhibit P-22 shall not be enforced. The
Commissioner shall take the decision on the application of the
petitioner within a period of one month from today.
With the above directions, the present writ petition is finally
disposed of.
Sd/-
DINESH KUMAR SINGH
JUDGE
Svn
WP(C) NO. 29554 OF 2023
APPENDIX OF WP(C) 29554/2023
PETITIONER'S EXHIBITS
EXHIBIT P1 A TRUE COPY OF THE PROCEEDINGS BEARING
F.NO.280/EXEMP/CC-TVM/13/2009-10 DATED
18.08.2010, ALONG WITH THE TYPED COPY OF THE
SAME
EXHIBIT P2 THE TRUE COPY OF THE ACKNOWLEDGMENT FOR HAVING
FILED THE RETURN OF INCOME DATED 25.04.2015
EXHIBIT P3 A TRUE COPY OF THE NOTICE UNDER SECTION 139
(9) DATED 13.09.2015 ALONG WITH TYPED COPY
EXHIBIT P4 A TRUE COPY OF THE RELEVANT PAGES OF THE
RETURN DATED 17.10.2015
EXHIBIT P5 A TRUE COPY OF THE INTIMATION UNDER SECTION
143(1) DATED 05.01.2017
EXHIBIT P6 A TRUE COPY OF THE PROOF OF HAVING FILED THE
RECTIFICATION REQUEST DATED 03.01.2017
EXHIBIT P7 A TRUE COPY OF THE REQUEST DATED 30.01.2018
FILED BY THE PETITIONER BEFORE THE 3RD
RESPONDENT
EXHIBIT P8 A TRUE COPY OF THE REMINDER DATED 20.06.2019
FILED BEFORE THE 3RD RESPONDENT BY THE
PETITIONER
EXHIBIT P9 A TRUE COPY OF THE REQUEST DATED 24.03.2021
FILED BEFORE THE 3RD RESPONDENT BY THE
PETITIONER
EXHIBIT P10 A TRUE COPY OF THE LETTER DATED 06.10.2021
ALONG WITH AUDIT REPORT IN FORM NO. 10BB FILED
BEFORE THE 3RD RESPONDENT BY THE PETITIONER
EXHIBIT P11 A TRUE COPY OF THE PROCEEDINGS UNDER SECTION
154 DATED 15.11.2021 ISSUED BY THE 3RD
RESPONDENT TO THE PETITIONER
WP(C) NO. 29554 OF 2023
EXHIBIT P12 TRUE COPY OF THE APPLICATION FOR CONDONATION
OF DELAY DATED 17.12.2021 FILED BEFORE THE 2ND
RESPONDENT BY THE PETITIONER
EXHIBIT P13 A TRUE COPY OF THE NOTICE DATED 28.02.2022
ISSUED BY THE 3RD RESPONDENT TO THE PETITIONER
EXHIBIT P14 A TRUE COPY OF THE LETTER DATED 08.03.2022
(WITHOUT ANNEXURES) FILED BY THE PETITIONER
EXHIBIT P15 A TRUE COPY OF THE WRITTEN SUBMISSION DATED
08.03.2022 FILED ALONG WITH EXT. P14 LETTER
EXHIBIT P16 A TRUE COPY OF THE ORDER DATED 06.09.2022
PASSED BY THE 2ND RESPONDENT UNDER SECTION
119(2)(B) OF THE ACT
EXHIBIT P17 A TRUE COPY OF CIRCULAR 9/2015 DATED
09.06.2015 ISSUED BY THE 5TH RESPONDENT
EXHIBIT P18 A TRUE COPY OF CIRCULAR NO. 19/2020 DATED
03.11.2020 ISSUED BY THE 5TH RESPONDENT
EXHIBIT P19 A TRUE COPY OF CIRCULAR NO. 15/2022 DATED
19.07.2022 ISSUED BY THE 5TH RESPONDENT
EXHIBIT P20 A TRUE COPY OF THE ORDER UNDER SECTION 250 OF
THE ACT DATED 16.02.2023 PASSED BY THE 6TH
RESPONDENT
EXHIBIT P21 A TRUE COPY OF FORM NO. 10B DATED 24.04.2015
EXHIBIT P22 A TRUE COPY OF THE NOTICE DATED 25.08.2023,
ISSUED BY THE 3RD RESPONDENT
EXHIBIT P23 A TRUE COPY OF THE REPLY ALONG WITH
ACKNOWLEDGMENT FOR HAVING UPLOADED IN THE
PORTAL
