Will CBDT Extend ITR Due Date for Audit Cases?
The Central Board of Direct Taxes (CBDT) had earlier extended the last day for filing tax audit reports to October 31. This decision came after the Rajasthan and Karnataka High Courts ordered CBDT to extend the due date of filing the tax audit report. However, many taxpayers and professionals across the country are raising concerns, saying that the ITR filing date must also be extended.
The Gujarat High Court, in a recent order, has questioned CBDT, asking why it did not extend the due date for filing Income Tax Returns (ITR) when the audit report due date was extended. The question was asked by Justice Bhargav Karia and Justice Pranav Trivedi in a petition filed by tax bodies. Additionally, the Karnataka and the Rajasthan High Courts also pushed the tax department to give more time to the professionals and taxpayers for filing tax audit reports under Section 44AB of the Income Tax Act, 1961.
Many tax professionals raised their concerns over the glitches on the Income Tax Department’s e-filing portal. These glitches include portal glitches, slow portals, and errors in accessing key documents.
Following these issues, the CBDT extended the tax audit report filing deadline from September 30 to October 31. In response, the petitioners’ lawyer pointed out that, as per Explanation (ii) of Section 44AB of the Income Tax Act, audit reports are supposed to be filed one month before the due date for filing income tax returns under Section 139(1). Based on this, the lawyer argued that the return filing deadline for FY 2024-25 should also be extended to November 30, and the department should have issued a separate notification for that as well.
Citing a Gujarat High Court ruling from September 2024 on a similar matter, the petitioner mentioned that the court in this case held that the government cannot extend the deadline for filing tax audit reports without also extending the due date for filing income tax returns. In this case, the court also observed that it would go against the provisions laid out in the Income Tax Act.
They further argued that Section 119 of the Act does not give the CBDT the authority to relax the conditions under Section 44AB. This, according to them, clearly reflects the legislative intent that the deadline for submitting audit reports cannot be extended without extending the ITR filing due date.
The court, following the earlier decision, said that, when the deadline for filing audit reports is extended by the Board, the due date for filing returns under Section 139(1) is deemed to be extended by one month. Therefore, the Board must explain why a relevant notification to extend the return filing deadline was not issued at the same time. The matter is set to be heard on October 6.
