In a significant judgment on the scope of condonation powers under the Income Tax Act, the Delhi High Court has held that ignorance of tax laws, lack of awareness of deductions, or general claims of hardship do not constitute “genuine hardship” for condonation of delay under Section 119(2)(b) of the Income Tax Act, 1961.A division bench of Justice V. Kameswara Rao and Justice Vinod Kumar dismissed a writ petition filed by Manjeet Singh Dhaliwal, upholding the rejection of his application seeking condonation of delay in filing his Income Tax Return (ITR) for assessment year 2020-21.Background and factsThe petitioner, a Canadian citizen resident in British Columbia, claimed to be non-resident for the relevant assessment year. He had sold immovable property in India totaling Rs 2,00,16,550/- and also earned interest income of Rs 19,246/- during the same period. Tax was already deducted at source on the transaction and deposited with the Government of India.Despite this, the petitioner failed to file his ITR within the time prescribed under the Income Tax Act.On 06.06.2025, after almost five years, he filed an application under Section 119(2)(b) of the Act for condonation of delay. He claimed that he had been living outside India for many years, was unfamiliar with the Indian tax regime and did not understand the tax consequences of the property transaction, which was done by power of attorney.He further claimed that being a senior citizen with no knowledge of tax laws, his failure to file the return was a genuine error. They also relied on factors like health issues, Covid-19 related travel restrictions and lack of awareness about TDS deduction.The petitioner, relying on the phrase “genuine hardship” under Section 119(2)(b), argued that the term should be interpreted broadly and technicalities should not come in the way of adequate justice. disputed order of tax authorityThe Commissioner of Income Tax (International Taxation) rejected the application holding that the petitioner had failed to establish any genuine hardship or reasonable cause for the delay.The Authority found that the reasons cited, particularly ignorance of TDS deduction, were general in nature and had no valid basis. This relied on the established legal adage:“Ignorantia Legis Neminem Excusat” ((Ignorance of the law is no excuse)The Authority further stated that the petitioner’s reliance on medical issues was misplaced, as the surgeries cited had taken place in 2008 and 2011, much before the relevant assessment year. It was also observed that the petitioner had executed a property transaction through a power of attorney, indicating that he was able to manage his financial affairs through representatives.The authority also rejected the COVID-related argument and said that:“The taxpayer could easily file ITR online on the Income Tax portal from anywhere and thus there was no need for him to be physically present in the country.”It was also clarified that capital gains are taxable in the year of transfer of the asset and not in the year of receipt of consideration, thereby misunderstanding the tax liability of the petitioner.The Authority concluded that:“The assessee has failed to establish a case of genuine hardship or to show any specific reasonable cause… the application… is devoid of merit.”court opinionThe High Court examined the order and reasons given by the petitioner and found no merit in the challenge.The Court specifically rejected arguments that the petitioner’s lack of awareness of tax laws or his alleged illiteracy could justify the delay. It was held that such a petition was not acceptable in law.Referring to the established principle, the Court said:“On the principle of ignoratia juris non excusat, that is, ignorance of the law is no excuse…”The court relied on its earlier decision Puneet Rastogi vs Principal Chief Commissioner of Income Tax (International Taxation)Where it was held:“This Court is of the view that ignorance of the law is no excuse… Consequently… there was no genuine difficulty or reasonable cause for late filing of the return.”Scope and “genuine hardship” of section 119(2)(b)The Court also upheld the tax department’s view regarding the limited scope of exemption under section 119(2)(b). It was observed that the provision allows the tax authority to ignore genuine hardship only and not as a routine matter. The court cited its previous decision BU Bhandari Nandgude Patil Associates vs CBDTAnd repeated:“Prescribed statutory time limits have to be adhered to…Extension of time based on mere asking and vague claims without evidence cannot be claimed as a vested right.”The Court also noted the principle that:“The mere fact that there has been an omission for some reason is not sufficient to establish a claim of genuine hardship.”The need for strict adherence to deadlinesThe Court stressed the importance of maintaining discipline in statutory deadlines, especially in tax matters. It was observed that limitation provisions are necessary to ensure systematic and timely completion of the assessment. The authority’s reliance on judicial precedents was noted, including principles that laid down Ranka and others vs. Rewa Coalfields Limited He:“Every day of delay needs to be explained with solid evidence.”The Court observed that no such concrete explanation has been provided in the present case.The Court also rejected the argument that the petitioner’s NRI status or the existence of travel restrictions justified the delay. It states that income tax returns can be filed electronically from any location and physical presence in India is not required.relying on my judgment in Sanjay Khurana vs Income Tax DepartmentThe Court said:“The petition… being a NRI… is not attractive as the e-portal was globally accessible.”After considering the entire material on record, the High Court agreed with the findings of the tax authority and held that no interference was required.The Court said:“We agree with the view adopted by the officer in the impugned order and see no reason to interfere with it.”It concluded by holding:“Without any merit, the petition is dismissed.”Accordingly, the writ petition along with the pending application was dismissed.
- WP(C) 19589/2025 & CM APPL. 81894/2025
- Manjeet Singh Dhaliwal vs Commissioner of Income Tax International Taxation 01 New Delhi
- For Petitioner: Ms. Nikita Thapar, Advocate.
- For the respondent: Mr. Debesh Panda, SSC, Ms. Zahra Khan, JSC, Mr. Vikramaditya Singh, JSC, Ms. Nivedita, Ms. A. Shankar, Ms. Ravicha Sharma, Advocate.
(Vatsal Chandra is a Delhi-based lawyer practicing in the courts of Delhi NCR.)
