Case Details: Teksons (P.) Ltd. vs. Chief Commissioner of Income-tax Mumbai - [2026] 185 taxmann.com 814 (Bombay)
Judiciary and Counsel Details
- B. P. Colabawalla & Firdosh P. Pooniwalla, JJ.
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K. Gopal & Ms Neha Paranjpe, Advs. for the Petitioner.
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Vikas T. Khanchandani, Adv. for the Respondent.
Facts of the Case
Assessee-company filed an application under section 119(2)(b) seeking condonation of the delay of 169 days in filing the return. The delay was caused by disputes between directors, which led to NCLT proceedings and delayed the finalisation of financial statements. The revised financial statements were approved, after which the audit report was filed.
However, the time limits under sections 139(1) and 139(4) had already expired, preventing them from filing the return. The Chief Commissioner rejected the application, holding that the assessee had not established “genuine hardship” or reasonable cause for the delay. Aggrieved by the order, the assessee filed a writ petition to the Bombay High Court.
High Court Held
The High Court held that the assessee had been regularly filing the return of income for many years. Except for the year under consideration, there was no default on the part of the assessee in filing the return of income in any earlier or subsequent assessment years. The delay occurred due to disagreements among the company’s Directors regarding certain financial statement items and other management issues.
The same resulted in proceedings before the National Company Law Tribunal (NCLT). The revised financial statements were approved by a majority of the Directors in a board meeting held on 25.02.2023. With the approval of all the Directors of the Company, the tax audit report was uploaded and submitted to the Income Tax Department on 29.03.2023, with a delay of 172 days. The audit report was filed within the time prescribed under section 139(4) of the Act. However, no returns could be filed, as the time limit for filing under sections 139(1) and 139(4) had expired.
Thus, after considering the reasons for the delay, including the disputes between the Directors of the assessee company, the delay in filing the return ought to be condoned.
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