Assessee’s Failure to File Return at the Material Time can’t be considered as Willful: Delhi HC [Read Judgment]

Claims Grant Refunds - Assessee’s - Failure - Delhi - High - Court - Taxscan

The Delhi High Court upheld the decision of the appellate tribunal that the assessee’s failure to file the return at the material time cannot be considered as willful.

That search and seizure operations under Section 132 of the Income Tax Act were conducted in respect of the Standard Watch Group of Concerns. This included search in the premises occupied by the respondent and his brother – premises bearing no. S-511, New Delhi.

The respondent and his brother S. K Gupta were residing on different floors of the same premises. Thereafter, on 21.04.2010, a notice under Section 153A of the Act was issued to the respondent calling upon the petitioner to furnish a return in respect “of the company in which you are assessable for the Assessment Year 2008-09” within sixteen days of the service of the said notice.

Thereafter, a show-cause notice dated 15.11.2010 was issued to the respondent. Subsequently, another notice dated 06.06.2011 under Section 153A of the Act was issued, calling upon the respondent to file a return of income in respect of “the individual/company in which you are assessable for the Assessment Year 2008-09” in the prescribed form within a period of fifteen days from the service of the said notice.

The respondent responded to the said notice and relying upon his response to the earlier show-cause notice (letter dated 12.10.2010, which was filed on 26.11.2010). He stated that the complete records relating to IT Returns including relevant data, photocopies, and relevant documents were in possession of his brother, who was responsible for income tax compliances and filing of income tax returns for the whole family.

The respondent further stated that there were certain disputes between his family and his brother (Shri Suresh Gupta) and the complete records had not been returned by Shri Suresh Gupta to him or his family. He stated that he had no copies of the earlier returns and/or related documents assessee’s failure.

However, he further stated that the return filed earlier be treated as a return in response to the notice under Section 153A of the Act.

The single bench of Justice Vibhu Bakhru observed that in the circumstances, it would be necessary for the respondent to examine all material documents seized during the search and seizure operations before filing the return. The respondent had already indicated his difficulty in doing so in view of the family disputes and had requested for inspection and copies of all documents seized during the raid.

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