The Bombay high court on Thursday directed the Central Board of Direct Taxes(CBDT) to consider an extension of the due date for filing of income tax (I-T) returns by non-salaried taxpayers to November 30 from September 30. Non-salaried taxpayers, who are covered under tax audit provisions but to whom the transfer pricing provisions do not apply, are required to file their I-T returns and get their accounts audited (for tax purposes) by September 30.

 

In August, the CBDT had extended the due date for filing the tax audit report to November 30. This extension was introduced owing to the substantial changes made in the revised Tax Audit Report Form (Form 3CD). However, the due date of September 30 for filing the I-T return itself was not extended, which resulted in an anomaly.

Business entities (including companies) whose sales, turnover or gross receipts exceed Rs 1 crore and professionals such as advocates or doctors, whose gross revenue is more than Rs 25 lakh are covered by the tax audit provisions and were adversely impacted. As details contained in Form 3CD are the basis for filing the I-T return, many of these taxpayers faced difficulties. This prompted tax practitioners and professional associations to file writ petitions across high courts in India, seeking extension of the date for filing the I-T return.

Over the past two days, the Bombay high court heard the writ petition filed by the Chamber of Income-Tax Consultants (CITC), seeking an extension in the I-T return due date to November 30 for the assessment year 2014-15 (for fiscal ended March 31, 2014). In its order on Thursday, the Bombay high court held: "The CBDT should consider the representation of the CITC on or before September 30." It also added, "Petitioners are entitled for further relief in view of decisions of other high courts, if they are more favourable."

Paras Savla, president of the CITC, says, "The CBDT should act upon the directions of the high courts at the earliest and extend the due date for filing of the I-T returns. This will alleviate the genuine hardships being faced by the taxpayers."

The Bombay high court's order comes in the footsteps of similar orders passed recently by various high courts in Gujarat and Madras. The Madras HC, in its order dated September 24, had held, "The CBDT is directed to consider the request of the taxpayers in general and consider extension of the time for filing the tax return." However, it added that if the petitioners' claim is rejected, the consequences of section 234A would automatically follow.

Section 234A of the Income Tax (I-T) Act, 1961, levies a simple interest at 1% for every month or part of the month, from the due date of filing the income tax return to the date the return is actually filed. The Madras HC had heard the writ petitions filed by the All India Federation of Tax Practitioners and others.

It is learnt that the counsels for the Union of India and the CBDT, which appeared in these cases, would be communicating the directions of the HCs to the CBDT for issue of an appropriate notification for extension of the I-T return filing due date. (Times of India)