Gujarat High Court Allows NRIs’ Delayed Income Tax Return, Citing COVID Hardship
The Gujarat High Court has recently allowed an NRI’s late income tax return, recognising that his delay was due to genuine COVID-19 hardships, and directed the tax department to accept his return within 12 weeks.
Mr Lokendra Ramanbhai Patel (applicant) has filed the present civil application in the Gujarat High Court (R/Special Civil Application No. 11322 of 2025) against the Commissioner of Income Tax (IT and TP) AMEDABAD and Another (respondent). The case was heard by benches comprising Justice Bhargav D. Karia and Justice Pranav Trivedi.
Background of Case:
The applicant is a non-resident of India (NRI) who has resided in Nairobi since 1965. On May 21, 2020, the applicant sold a residential plot (Plot No. 79 at Gulmohar Residential Enclave) worth Rs. 11,287,500. The property was jointly owned by him and his wife. This sale generates them a long-term capital gain (LTCG), which is taxable income.
On March 31, 2020, the buyer of the property deducted Rs. 12,91,290 as Tax Deducted at Source (TDS) and deposited it with the Income Tax Department. The problem is this deducted tax, i.e., TDS, was mistakenly shown in Form 26AS under assessment year 2020-21 instead of assessment year 2021-22 (the correct AY for the sale).
On June 23, 2020, the applicant led the country, which was just after the sale. But, as it was the period of the COVID-19 pandemic, and there were strict rules on travelling, he could not travel back to India. Because of this reason, he missed filing his ITR (Income Tax Return) for the assessment year 2021-22 within the statutory deadline stated under Section 139(5) of the Income Tax Act.
Thereafter, the applicant filed an application on November 28, 2024, under Section 119(2)(b) of the Income Tax Act, urging the tax department to accept his late return due to genuine hardship. The Income Tax Department gave the applicant a chance to present their side and also a chance for a personal hearing. The applicant filed his written reply on December 24, 2024. However, the department in the end rejected his request on June 16, 2025, saying this is not a case of ‘Genuine Hardship.’
Case to High Court
The applicant found this unfair and approached the Gujarat High Court. The court observed the case deeply, and to announce its decision, it cited an earlier judgment based on a similar issue titled Yogesh Rasiklal Chandrani vs. Commissioner of Income-tax (IT & TP), Gujarat (2025), where another NRI was unable to file his return due to COVID, and the High Court had allowed it. Considering the same, the High Court passed the following orders:
- Considering the Income Tax Department’s order dated June 16, 2025, as wrong, the High Court quashed the order.
- Condoned the delay in return filing due to genuine COVID hardship and allowed the applicant to file his ITR for the assessment year 2020-21.
- Remands the case to the Income Tax Department to reconsider it and directs the department to pass a fresh order accepting the ITR within 12 weeks of receiving the court order.
Citation: Lokendra Ramanbhai Patel Vs Commissioner of Income Tax (IT and TP) AMEDABAD and Another (Gujarat High Court); R/Special Civil Application No. 11322 of 2025; 06/10/2025; 2021-22
