No further extension in I-T filing due dates, holds Gujarat HC

MUMBAI: The Gujarat high court declined to interfere and issue a ‘writ of mandamus’ to the Central Board of Direct Taxes (CBDT) for further extending the time limits to file the tax audit report and the Income-tax (I-T) returns up to March 31.
The All Gujarat Federation of Tax Consultants had filed a writ petition with the high court seeking extension of the filing due dates for the financial year ended March 31, 2020.
Ordering extension of the due dates may upset the entire functioning of the government and may lead to undesirable results, the high court stated. However, it added that the CBDT may consider issuing an appropriate circular taking a lenient view as regards the consequences of late filing of tax audit report – relating to penalties prescribed under section 271B of the I-T Act.
Consequent to filing of the writ petition, the high court asked the CBDT to look into the matter. Following this, CBDT issued a detailed order on January 11 and stated that in the backdrop of the pandemic, the government had been considerate and had extended the due dates from time to time.
For instance, the due date for filing the I-T returns for non-audit cases was extended thrice from the original due date of July 31, 2020 to January 10, 2021. For taxpayers who are required to get their accounts audited, the due date was extended from October 31, 2020 to now stand at February 15, 2021.
Tax audit reports could now be filed by January 15, 2021 as opposed to the original due date of August 30, 2020. Backed by statistics, the CBDT also submitted that the number of returns filed for the FY 2019-20 (5.95 crore as of Jan 10) already exceeded those filed in the previous year by around 6%.
The counsel for the Federation argued that “…The CBDT had very conveniently and consciously not addressed itself to the hard reality that the utilities for E-filing the tax audit reports and I-T returns were released at a belated stage.”
For instance, substantive amendments were made in the form of the tax audit reports on October 1 and the utilities were released only on October 22.
This had created a complete state of disarray. Even if the two subsequent extensions are taken into consideration, then the total time available is only 85 days instead of 183 days, the counsel pointed out.
However, the high court held that CBDT must have taken its decision not to extend the dates further, after due deliberations.
Ordering an extension of the due dates may upset the entire functioning of the government and may lead to undesirable results, the high court stated. However, it added that the CBDT may consider issuing an appropriate circular taking a lenient view as regards the consequences of late filing of a tax audit report – relating to penalties prescribed under section 271B of the I-T Act.