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Condonation of delay is usually applied for the delay in filing suits or applications in the courts in India. It is also applied if the due date of filing income tax return has passed and the taxpayer wants to file those past returns.
Condonation of delay means the act of condoning the delay in filing an appeal or application by the respective courts. Each statute gives a time limit within which any suit, appeal or application is to be filed under them to the courts/respective authorities. The time limit prescribed is known as the limitation period of the suit or appeal.
When the suit or application is not filed within the time limit or limitation period prescribed in the statute, a delay occurs. The court(s)/respective authority will not accept the suit or application beyond the limitation period. Condonation of delay is an exception to such limitation period. It is a remedy provided to a person if he fails to approach the court/respective authority within the time limit prescribed under the law.
The respective statutes provide for condonation of delay for suits, appeals or applications under certain circumstances. If the person filing the suit or appeal or application can furnish a sufficient cause for the delay, leading to the expiry of the limitation period, the court/respective authority can, with discretionary jurisdiction condone the delay by accepting the suit/application.
The Limitation Act, 1963, provides the limitation period for a suit. It explains what is to be included and what is to be excluded while calculating the limitation period for a suit or appeal. Section 5 of the Limitation Act talks about the condonation of delay. It provides that the court can accept any appeal or application when filed after the limitation period if the appellant or applicant shows that he had a sufficient cause for not filing the appeal or application within the prescribed period.
The term “sufficient cause” is not defined under the Limitation Act. It varies from case to case. The court has wide discretion for the determination of what constitutes a sufficient cause depending on each case’s facts and circumstances. However, the Limitation Act provides for condoning delay with respect to all applications except applications filed for the execution of decrees and order.
Instances where condonation is allowed-
Section 460 of the Companies Act, 2013 provides for condonation of delay of application or document to be filed by a company. Section 460(a) states that where any application is required to be made to the Central Government under any provision of the Act, and if it is not filed within the time prescribed, the Central Government can condone the delay on the reasons recorded in writing.
Section 460(b) states that where any document is required to be filed to the Registrar under any provision of the Act, and it is not filed within the time prescribed, the Central Government can condone the delay on the reasons recorded in writing.
Procedure for condonation of delay
If a company delays in filing any application or document within the prescribed time, then it needs to apply to the Central Government for condonation of delay under Section 460 to accept its delayed application or document.
The procedure is as follows-
The Central Government under the powers conferred to it under Section 460 has also introduced schemes such as the Company Law Settlement Scheme, 2014, Condonation of Delay Scheme, 2018, Companies Fresh Start Scheme, 2020 and LLP Settlement Scheme, 2020 for condoning the delay of the companies.
These schemes condoned the delay and allowed the companies to file their annual documents beyond the prescribed time limit without much or no penalty or punishment for the delay. However, these schemes were introduced for a specific period, usually for a period of one year under which the company could take advantage of the respective schemes and file the belated documents to the Registrar.
Section 119(2)(b) of the Income Tax Act, 1961 provides for condonation of delay of any application or claims filed under the Act. It states that the Central Board of Direct Taxes (CBDT) can authorise any income-tax authority to admit an application or claim for the deduction, exemption, refund or any other relief under the Income Tax Act post the expiry of the time limit prescribed under the Act. The CBDT will authorise income tax authorities to accept any application or claim if it considers it to be expedient to do so to avoid genuine hardship of the party. The income tax authority will allow the delayed claim, provided, making the claim within the prescribed due date was genuinely out of the control of the taxpayer.
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