On December 23, 2025, the Delhi High Court turned down a plea from a senior citizen of Indian origin who was asking for condonation of delay (an extension) to file his income tax return (ITR). This decision was taken in the light of a case filed by an individual of Indian person who is now a Canadian citizen.
This person had sold his property in India for Rs 2 crore through a power of attorney and the buyer had deducted TDS against the sale price and deposited it with the Income Tax Department. However, Mr. Singh who lived in Canada, was unaware of this, and by the time he learned about TDS, the deadline for filing ITR has passed. Therefore, he requested for condonation of delay to file the ITR and reclaim his TDS as a tax refund.
Mr. Singh’s lawyer told the court that he is illiterate and unfamiliar with Indian tax laws. The Delhi High Court responded according to the principle of ignorantia juris non excusat, meaning ignorance of law is no excuse.
As a result, the court ruled that ignorance of Indian tax law does not qualify as valid hardship that would justify a condonation of delay for filing ITR under Section 119(2) (b) of Income Tax Act, 1961.
Case precedent cited: Delhi HC in Puneet Rastogi v. Principal Chief Commissioner of Income-tax (International Taxation) and another, (2023) 454 ITR 37
An extract of Mr. Singh’s condonation of delay application as reproduced by Delhi High Court read:
- “For verification of my sources of income the copy of form 26AS is being annexed for the year as per Annexure B. Whereas, I have been living outside India from many years and also I am senior citizen having no knowledge of Income Tax matters.
- As a senior citizen with no prior knowledge of income tax matters, I was genuinely unaware of the tax implications arising from the sale of my property, which was executed through my Power of Attorney. Mr. Batra.
- It was only recently, upon my travel to India, that I become cognizant of the tax deduction made by the Government of India. I kindly request that this oversight be considered a bona fide error on my part. Your good office has been vested with powers to admit an application like that of assessee in light of provisions of section 119(2)(b) of the Act, to avoid cases of such genuine hardship.”
Summary of the judgement
Chartered Accountant (Dr.) Suresh Surana, said to ET Wealth Online that in this case the Delhi High Court considered whether a non-resident taxpayer could be granted relief for filing an income-tax return after almost five years.
According to Surana, the case focused on the scope of Section 119(2)(b) of the Income-tax Act, 1961 and examined whether such an exceptionally long delay could be condoned based on the reasons put forward by the taxpayer.
Surana says that the taxpayer, a non-resident individual, had sold immovable property in India during AY 2020–21. Although tax was deducted at source (TDS) by the buyer on the sale consideration, the taxpayer did not file the income tax return (ITR) within the prescribed timeline.
In June 2025, a belated application for a condonation of delay was made, citing lack of familiarity with Indian tax laws, health issues, COVID-19 travel restrictions, and the fact that the transaction was executed through a power of attorney.
Surana says that the tax authorities rejected the application on the ground that no “genuine hardship” was established. The reasons cited were found to be either general or unsupported by evidence.
The authorities noted that ignorance of law is not an excuse as the health issues referred to surgeries that took place many years earlier, and COVID-related restrictions did not prevent online filing of returns.
Surana says that it was also emphasized that capital gains are taxable in the year of transfer of property, irrespective of when sale proceeds are received.
Surana says that the Delhi High Court upheld the rejection, reiterating that statutory timelines under the Income Tax Act must be strictly adhered to and that the discretionary power of condonation can be exercised only in exceptional cases supported by cogent evidence.
Surana says: “Since the taxpayer failed to demonstrate any exceptional circumstances and the petition was bereft of merit, the same was dismissed.”
What happens to the TDS deducted on the property sale?
According to Surana, while the amount remains credited to the government, a refund or adjustment can be claimed only through the filing of a valid income-tax return (ITR) which has been rejected in this particular case.
Surana says: “Where the return is not filed within the prescribed statutory timelines and the delay is not condoned, the taxpayer may not technically have access to any remedy to either adjust the same against any demand or seek refund (as the case may be) of such TDS deducted and deposited.”
Why did he lose the case?
The Delhi High Court accepted all the reasons given by the Income Tax Department for rejecting Mr. Singh’s condonation of delay application. A short extract is as follows:
6.2. In fact, in the case of M/s B. U. Bhandari Nandgude Patil Associates Vs the C.B.D.T. (WP(C) No. 6537/2017), the Hon’ble High Court of Delhi held that: “It should be noted first that disallowance of any claim will normally lead to hardship. The legislature has provided time limits for certain obligations under the Act and these time limits have to be observed to be able to claim certain deductions, allowances and avoid interest and penalty This may be termed a hardship but it is hardship imposed by law in the interest of proper regulation of the Act. If these time limits were to be relaxed in a particular case, mere fact that a default occurred due to some reason is not enough to establish the claim of genuine hardship. 10. In determining whether genuine hardship is caused to the applicant one has to see whether the delay in filing of return was due to a reasonable cause or not.
17. Statutory time limits fixed have to be adhered to as it ensures timely completion of assessments. Discipline on time limits regarding filing of returns have to be complied and respected, unless compelling and good reasons are shown and established for grant of extension of time. Extension of time cannot be claimed as a vested right on mere asking and on the basis of vague assertions without proof.”
6.3. Further, the Hon’ble Supreme Court of India in the case of Ranka & Others Vs. Rewa Coalfields Ltd. (AIR 1962 SC 361) held that:
“every day of delay needs to be explained with cogent evidences.”
6.4. Similar view has also been taken by the Hon’ble Madras High Court in the case of Madhu Dadha Vs. ACIT (317 ITR 458) wherein it held that:
“the limitation of time limit is one of the cornerstones of proceedings under the Income Tax Act, 1961. Therefore, condonation of delay is allowable in limited cases of genuine hardship only.”
6.5. In the case of Lava International Ltd. Vs. Central Board of Direct Taxes in WP (C) No. 8293 of 2024, the Hon’ble High Court of Delhi held as under: “6. We find no justification to interfere with the ultimate view which has been taken and which stands succinctly encapsulated in para 9 of the impugned order and where the authority has spoken of the imperatives and necessity of ensuring statutory compliance with the timeframes which otherwise stand constructed under the Act, as follows:- “9. It should be noted that the legislature has provided time limits for certain obligations under the Act and these time limits have to be observed to be able to claim those deductions, allowance and avoid interest and penalty. This cannot be termed as hardship but it is compliance requirements imposed by law in the interest of proper regulation of the Act. If these time limits were to be relaxed in a particular case on mere fact that a default occurred due to some inadvertence then there will be no sanctity of limitation prescribed by the legislature. Therefore, power of condonation u/s 119(2) can be exercised to deal with the extraordinary circumstances only which would have led to delay in statutory compliance and the same cannot be exercised routinely.”
aniltikotekar4sme.com 