Facts of the Case

The petitioner, Anupam Gian Vikas Pari Shad, is a charitable trust registered under Section 12A of the Income-tax Act and entitled to claim exemption under Section 10(23C). The trust has been running an educational institution, New Happy Public School at Narela, since 01.04.1989 and has consistently been granted exemption in earlier years. For Assessment Year 2020-21, the petitioner filed its return of income on 15.02.2021 within the prescribed time. However, there was a delay of 31 days in filing audit report in Form 10BB, which was required to be filed at least one month prior to the return.

The petitioner attributed the delay to mitigating circumstances arising from the COVID-19 pandemic. An application dated 13.03.2024 was filed under Section 119(2)(b) seeking condonation of delay. As no decision was taken on the said application, the petitioner filed another application on 19.12.2024 relying on CBDT Circular dated 18.11.2024. The latter application was rejected by an order dated 29.01.2025 on the ground that it was filed beyond three years from the end of the assessment year. Aggrieved, the petitioner approached the Delhi High Court.

Issues Involved

Whether rejection of the petitioner’s application for condonation of delay in filing Form 10BB solely on the ground of limitation was justified when an earlier application seeking the same relief was already pending, and whether the authority was required to adjudicate the earlier application under Section 119(2)(b).

Petitioner’s Arguments

The petitioner contended that the delay in filing Form 10BB was marginal and occurred due to extraordinary circumstances during the COVID-19 pandemic. It was submitted that the audit report was filed along with the return and no prejudice was caused to the Revenue. The petitioner emphasized that an earlier application dated 13.03.2024 seeking condonation was filed within the prescribed period of three years and remained undecided. Therefore, rejection of the later application on limitation grounds was unsustainable.

Respondent’s Arguments

The Revenue fairly submitted that it would have no objection to a direction being issued to decide the petitioner’s earlier application dated 13.03.2024 filed under Section 119(2)(b). It was also submitted that if the petitioner obtained a favourable decision on the said application, the remaining reliefs sought in the writ petition would not survive.

Court Order / Findings

The Delhi High Court noted that the petitioner’s grievance essentially pertained to rejection of the condonation application without consideration of the earlier application filed within time. The Court recorded the statement made on behalf of the Revenue that there was no objection to adjudication of the petitioner’s application dated 13.03.2024. In view of the above, the Court directed the respondents to decide the petitioner’s application for condonation of delay in filing Form 10BB for AY 2020-21 that was filed on 13.03.2024, as expeditiously as possible and in any event within a period of eight weeks from the date of the order. All rights and contentions of the parties were expressly kept open.

Important Clarification

The High Court clarified that where an application for condonation of delay is already pending within the permissible time, rejection of a subsequent application on limitation grounds cannot defeat the assessee’s right to have the earlier application adjudicated. Authorities must decide such applications on merits in accordance with law.

Final Outcome

The writ petition was disposed of. The respondents were directed to decide the petitioner’s application dated 13.03.2024 filed under Section 119(2)(b) seeking condonation of delay in filing Form 10BB for Assessment Year 2020-21 within eight weeks. All rights and contentions of the parties were kept open.

Link to download order https://www.mytaxexpert.co.in/uploads/1769755856_ANUPAMGIANVIKASPARISHADVsCOMMISSIONEROFINCOMETAXEXEMPTIONDELHIANR..pdf 

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