Where last day for filing of income/loss return is a day on which income-tax office is closed, assessee can file return on next day afterwards on which office is open and return will be considered to have been filed within specified time limit: An Analysis
Where the last day for filing of income/loss return is a day on which the income-tax office is closed, assessees can file return on the next day afterwards on which office is open and return will be considered to have been filed within specified time limit. This is what the CBDT circular issued in 1992 provides.
The question now arises, if the return is filed on Monday, whether the late fee would be applicable? Whether the benefit of carrying forward the losses or any other benefits of the due date will be available if the return is filed on Monday?
Though the income tax office is normally closed on Sunday, the taxpayers are not required to visit the office for the purpose of filing income tax return. So, whether the office is closed or open doesn’t matter for the purpose of filing income tax return in general.
It is of high significance as the due date for general taxpayers for the AY 2022-23 is 31st July 2022 which is falling due on Sunday. Can it be presumed that the due date has been shifted to the next working day i.e., 1st August 2022? The issue has become all the more important in the context of the present technological era wherein the entire facility is automated & e-based with 24 X 7 working.
Let us see what CPC, CBDT, General clause Act & Limitation Act, precedents have to say in this regard. Let us know about it one by one.
CPC FAQ Dated 06.08.2012:
One may note that the Income Tax Department – Centralized Processing Cell (ITDCPC) has issued one FAQ on 06.08.2012 which provides the guidelines with regard to the various issues related to e-filing. The FAQ at Page No. 4 of ITDCPC FAQ on “E FILING AND CPC” dated 06-08-2012 reads as under:
“9. The last date of filing falls on Saturday or Sunday. Can I file my e-return on subsequent Monday?
Answer. Yes.”
One may note that the FAQ was issued way back in 2012 when the physical mode of return filing was also permissible. Rather, the majority of the returns were allowed to be filed in a manual mode. So, the context and purpose of issuance of the above FAQ was different and it may not be proper to follow the literal interpretation in the present scenario.
CBDT Circular clarifying the position:
Here is one important clarification by CBDT in 1992 exactly on this issue. Let us first read it:
Clarification regarding furnishing of returns under direct tax laws–Closed holiday—Regarding Circular No. 639 Dated 13/11/1992
Representations have been received by the Board seeking clarifications as to whether the assessee could file a return of income/loss under the Income-tax Act, 1961, on the next working day following a holiday and claim it to have been filed within the statutory time limit.
- The matter has been examined in consultation with the Ministry of Law and the Board are advised that, in such cases, section 10 of the General Clauses Act, 1897, will be applicable. According to this section, where any act or proceeding is directed or allowed to be done or taken in any court or office on a certain day or within a prescribed period, then, if the court or office is closed on that day or the last day of the prescribed period, the act or proceeding shall be considered as done or taken in due time if it is done or taken on the next day afterwards on which the court or office is open.
- In view of the above, it is hereby clarified that where the last day for filing return of income/loss is a day on which the office is closed, the assessee can file the return on the next day afterwards on which the office is open and, in such cases, the return will be considered to have been filed within the specified time limit.
- This clarification also applies to the returns under other direct tax enactments.
Above is the verbatim production of Circular NO. 639 as issued by the CBDT on 13.11.1992.
In short, the CBDT Circular of 1992 very categorically provides that if the due date is falling on Sunday for return filing then the next working day would be the due date. Here again, in my personal view, the context and reference of issuance was different.
Now let us know about the legal provision under other relevant Acts.
GENERAL CLAUSE ACT-1897
Section 10 to the General Clause Act-1897 which provides that that where any act or proceeding is directed or allowed to be done or taken in any Court or office on a certain day or within a prescribed period, then, if the Court or office is closed on that day or on the last day of the prescribed period, the act or proceeding shall be considered as done or taken in due time after it is done or taken on the next day, afterwards, on which the Court or office is open.
One must refer the provision of Section 10 of the General Clauses Act 1977 which reads as under:
Computation of time.
Section 10
Where, by any Act made after the commencement of this Act, any act or proceeding is directed or allowed to be done or taken in any Court or office on a certain day or within a prescribed period, then, if the Court or office is closed on that day or the last day of the prescribed period, the act or proceeding shall be considered as done or taken in due time if it is done or taken on the next day afterwards on which the Court or office is open:
Provided that nothing in this section shall apply to any act or proceeding to which the Limitation Act, applies
The law was drafted and enacted at a time when the “office” or “court” used to mean physical office/court. The provision now needs to be interpreted with reference to the new e-system wherein the “e-system” itself needs to be considered as “Office”.
In the present scenario, most of the filing is required to be done in an online mode through the portal which is available 24/7. For all the purposes, “office” is not closed for filing.
The exception provided in section 10 the General Clauses Act 1977 is with regard to the Limitation Act, 1963. The relevant part is contained in section 3 of the Limitation Act, 1963 which reads as under:
The Limitation Act, 1963
Section 4.
Expiry of prescribed period when court is closed.
Where the prescribed period for any suit, appeal or application expires on a day when the court is closed, the suit, appeal or application may be instituted, preferred or made on the day when the court re-opens.
Explanation:
A court shall be deemed to be closed on any day within the meaning of this section if during any part of its normal working hours it remains closed on that day.
It is very important here to note that the Explanation to Section 4 of The Limitation Act, 1963 provides “A court shall be deemed to be closed on any day within the meaning of this section if during any part of its normal working hours it remains closed on that day”.
The fact remains, the e-system of return filing is not closed for filing and one need to appreciate this fact before relying on this proposition.
At this juncture, one may also refer the CBDT circular Dated 676 issued in 1994 on due date for payment of advance tax which reads as under:
CIRCULAR NO. 676 DT. 14th JANUARY, 1994
Payment of advance tax in installments by the due dates under sections 210 and 211 of the Income-tax Act—Last day being holiday—Clarification regarding
14/01/1994
ADVANCE TAX, INTEREST PAYABLE AND RECEIVABLE
SECTION 211,, SECTION 234B, SECTION 234C
Representations have been received by the Board seeking waiver of interest chargeable under sections 234B and 234C of the Income- tax Act, 1961 for default in payment of installments of advance tax by the due dates which are prescribed under section 211 of the Income-tax Act in cases where the last date for making payment of such installments (i.e. 15th September, 15th December and 15th March) happens to be a holiday and the assessee pays the due amount of advance tax on the next working day.
- The matter has been carefully considered by the Board and it is felt that in such cases section 10 of the General Clauses Act, 1897 will be applicable. This section lays down that where any act or proceeding is directed or allowed to be done or taken in any Court or office on a certain day or within a prescribed period, then, if the Court or office (in the present case the bank which is authorised to receive payment of advance tax from the assessee) is closed on that day or on the last day of the prescribed period, the act or proceeding shall be considered as done or taken in due time after it is done or taken on the next day, afterwards, on which the Court or office (or the bank) is open. In view of this provision, it is hereby clarified that if the last day for payment of any instalments of advance tax is a day on which the receiving bank is closed, the assessee can make the payment on the next immediately following working day, and in such cases, the mandatory interest leviable under sections 234B and 234C of the Income-tax Act, 1961 would not be charged.
- These instructions may be brought to the notice of all the Assessing Officers under your jurisdiction.
[F.No. 275/78/93-IT(B)]
Conclusion:
One can fight the issue before the Court in view of all above legal propositions and material. However, the context and reference of all above material was totally different. It would be better if the CBDT comes out with urgent clarification on the issue and settles it to avoid litigation and disputes.
[Readers may please share their views at nareshjakhotia@gmail.com]
ITDCPC FAQ
