In an increasingly complex tax environment, taxpayers—especially Non-Resident Indians (NRIs)—often face challenges in filing income tax returns (ITRs) on time despite having tax deducted at source (TDS). Whether due to overseas posting, medical emergencies, or lack of procedural clarity, such taxpayers risk losing their legitimate refunds.
Fortunately, the law offers a remedy. Section 119(2)(b) of the Income-tax Act, 1961 provides an equitable framework for condonation of delay in cases where genuine hardship is established. In this blog post, we dissect the legal provisions, highlight landmark case law, and provide a structured guide for taxpayers seeking relief.
The Legal Provision: Section 119(2)(b)
Section 119(2)(b), Income-tax Act, 1961 empowers the Central Board of Direct Taxes (CBDT) to authorize income-tax authorities to admit applications or claims for any exemption, deduction, refund, or relief after the expiry of the statutory period, where "genuine hardship" is demonstrated.
This provision recognizes that delays may occur despite taxpayers' bona fide intentions, and therefore allows retrospective relief.
Interpretation by Courts: Quasi-Judicial Nature
Over the years, courts have reaffirmed that decisions under Section 119(2)(b) must adhere to principles of natural justice. The power is quasi-judicial and demands:
A reasoned and speaking order
Opportunity of personal hearing
Consideration of the genuine hardship on facts
Failure to do so invalidates the rejection and warrants judicial intervention.
Landmark Case: Jaldhi Overseas Pte Ltd. v. CBDT
Citation: [2025] 175 taxmann.com 263 (Madras High Court)
Bench: Hon'ble Justice Mohammed Shaffiq
Date: 17 April 2025
Facts:
The taxpayer failed to file ITR for AY 2011–12.
TDS had been deducted under its PAN.
Application for delay condonation under Section 119(2)(b) was filed.
The CBDT rejected it without a hearing or proper reasons.
Held:
Section 119(2)(b) confers quasi-judicial powers.
Rejection without personal hearing is a violation of natural justice.
The order was quashed, with a direction to CBDT to reconsider after granting a hearing.
Followed Precedent:
Envission Communication (P.) Ltd. v. Pr. CIT
[2023] 156 taxmann.com 459 / 460 ITR 620 (Madras HC)
Who Can Benefit -
This remedy is invaluable for:
NRIs who missed ITR deadlines despite TDS being reflected in Form 26AS
Residents who faced genuine hardship (hospitalization, loss of records, foreign travel)
Taxpayers seeking refunds or TDS credits that cannot be claimed due to expired ITR timelines
How to File a Delay Condonation Request
| Step | Action | Notes |
|---|---|---|
| 1️⃣ | Draft a condonation application to jurisdictional PCIT | Include PAN, Assessment Year, refund amount, reason for delay |
| 2️⃣ | Attach Form 26AS, ITR draft, supporting documents | Prove taxes were deducted and genuine hardship occurred |
| 3️⃣ | Clearly narrate the hardship | E.g., NRI overseas duty, COVID, illness, data mismatch |
| 4️⃣ | Request a personal hearing | Cite Jaldhi Overseas judgment |
| 5️⃣ | Submit via speed post or online portal (if enabled) | Retain acknowledgment for tracking |
Jurisdictional PCIT: The First and Best Forum
Taxpayers should first approach the Jurisdictional Principal Commissioner of Income Tax (PCIT) because:
It is cost-effective and faster than court remedies.
CBDT has delegated condonation powers for refund claims up to ₹10 lakhs per year (as per CBDT Circular No. 9/2015, dated 09-06-2015).
Properly justified applications with evidence and hearing requests are often accepted at PCIT level.
Going to the High Court is expensive, time-consuming, and best reserved for cases where principles of natural justice are clearly violated.
Real-World Example
An NRI taxpayer had ₹4.5 lakhs TDS in AY 2021–22 but missed filing ITR due to COVID restrictions and lack of access to digital records overseas. A well-documented delay condonation request was submitted to the PCIT, narrating the hardship and enclosing flight bans, embassy papers, and 26AS. Based on principles set in Jaldhi Overseas, the delay was condoned, and refund granted.
Legal Maxims to Remember
Audi alteram partem – Let the other side be heard
Lex non cogit ad impossibilia – Law does not compel the impossible
Key Case Law for Reference
| Case | Citation | Principle |
| Jaldhi Overseas Pte Ltd. v. CBDT | [2025] 175 taxmann.com 263 (Madras HC) | Hearing mandatory before rejecting condonation |
| Envission Communication (P.) Ltd. v. Pr. CIT | [2023] 156 taxmann.com 459 / 460 ITR 620 | Quasi-judicial power must follow natural justice |
Legal Map to Condonation of Delay
Don’t let your rightful refund vanish due to procedural delay.
If tax has been deducted under your PAN and you missed filing ITR within statutory timelines, you still have a legal and procedural remedy under Section 119(2)(b).
File a justified, documentary-supported, speaking application.
Assert your right to be heard.
Quote judicial precedents like Jaldhi Overseas and Envission Communication.
Your refund isn’t lost—you just need to assert your legal right backed by established law.
