P. Velu Chettiar vs Chief Commissioner of Income Tax and Another

R. Jayasimha Babu, J.—Condition No. 5 in the circular issued by the Central Board of Direct Taxes, which empowers the Chief

Commissioners and Directors-General (Investigation) to reduce or waive penal interest for late submission of a return of income, non-payment or

inadequate payment of advance-tax, etc., reads thus :

(v) where the return of income is filed voluntarily without detection by the Income Tax Department and due to circumstances beyond the control

of the taxpayer such return of income was not filed within the statutory time limit or advance tax was not paid at the relevant time.

The petitioner filed his return on January 29, 1997, for the years 1993-94, to 1996-97 voluntarily and paid tax. But, he did not offer any

explanation for the delay in filing the returns and did not show what the circumstances were, which could be regarded as being beyond his control

and which had come in the way of the returns not being filed in due time.

The Chief Commissioner, therefore, rejected the petition u/s 119(2)(a) for waiver of interest. In the order of the Chief Commissioner, it has

been noted that the Commissioner of Income Tax, Trichy, had opined that the petition deserves to be dismissed as no reason for the inordinate

delay has been given in the application. The Commissioner has also recorded that he had heard the representative of the applicant regarding the

applicability of the conditions mentioned in the circular and that the representative was unable to show the applicability of any one of those

conditions.

The criticism that the Chief Commissioner has relied on the order of the Commissioner, Trichy, is not a fair one. The Chief Commissioner has

applied his mind and found that the conditions mentioned in the circular were not satisfied.

Though, it is true, as submitted by counsel, that the return was filed voluntarily and the tax was paid, that by itself does not entitle the assessee to

the benefit of waiver. Condition No. 5 of the board''s circular further requires that the Commissioner be satisfied about the circumstances which

could be regarded as being beyond the control of the taxpayer for not filing the return within the stipulated time limit. The fact that the assessee had

a taxable income from the year 1994-95, is evident from the order of assessment and the tax paid. No explanation has been given as to why the

return was not filed within time for that year. The fact that the assessee had not been assessed to tax earlier, does not by itself constitute a

justification. By filing the return belatedly one cannot claim that fact itself as clothing the person with immunity for the liability for interest.

The petition is, therefore, dismissed.

No costs. Consequently, W. M. P. No. 5432 of 1999 is also dismissed.