ボンベイ高等裁判所、第87条Aの控除を確保するためCBDTにITR申告期限の延長を命令

In the matter of 

M/s The Chamber of Tax Consultants Vs Director General of Income Tax

(PIL 332426 of 2024)

The Public Interest Litigation (PIL) is filed by the petitioner against the modification in the Income Tax return utility with effect from 5th July 2024, which prevented the resident individuals from claiming the rebate under section 87A of Income Tax, 1961. As per the petitioner, such unilateral changes are arbitrary and against the legislative intent of Section 87A of the Income Tax Act.

Concerning the same, the Hon’ble High Court said that Procedural changes, such as those in utility software or instructions issued by the tax department, cannot override the substantive right to the rebate. Accordingly, as an interim relief, the Hon’ble High Court directed The CBDT to issue requisite notification under Section 119 of the Act extending the due date for e-filing of the ITR from December 31, 2024, at least to January 15, 2025. To ensure that all taxpayers eligible for the rebate under Section 87A are allowed to exercise their statutory rights without facing procedural impediments.

1. 事案の概要

• The petition is filed with respect to modification in Income Tax return utility by CBDT with effect from 5th July, 2024.
• Updated utility prevented the assessee from the claiming rebate under Section 87A by the individual assessee who has opted for new regime.
• The Petitioner filed the petition seeking the directions to the CBDT to modify the Income tax return utility provided for Assessment Year 2024-25.
• The petitioner alleged that the respondent has unilaterally disabled the assessees from claiming the benefit of Section 87A while filing income tax return of AY 2024-25 by modifying the utility software for filing ITR.
• If the returns are filed by the Assessee by using the utility after 5th July, 2024, they are unable to claim the benefit of section 87A.

2. Contention of the Petitioner

The Petitioner made following submission:

a. New Tax regime under section 115BAC:

• Section 115BAC was introduced by Finance Act, 2020 and it provided a simplified manner of computing tax liabilities for Individual and HUFs.
• The new tax regime provided a lower tax rate subject to the condition that certain exemptions and deductions are forgo by the assessee.
• The New tax regime is a default regime and the government has encouraged taxpayers to opt for a new regime to simplify compliances.
• However, implementation of Section 115BAC in conjunction with Section 87A has led to unintended complications.

b. Section 87A

• In Finance Act, 2013, section 87A was reintroduced to provide a rebate of INR 2000 from the tax payable.
• Such rebate amount was increased to INR 12,500/- through Finance Act, 2019.
• The principle behind Section 87A was to reduce the tax burden of persons with lower incomes. However, making arbitrary changes in utility to disable rebate has undermines the legislative intent.
• From AY 2024-25 onwards, an resident Individual with income upto INR 7 Lakhs shall be entitled to 100% rebate of income tax payable.
• However, arbitrary disabling rebate through utility post 5th July, 2024 onwards negates the intended benefit.
• This creates confusion among taxpayers and professionals and undermines the confidence of the public in the tax administration system. 
• Therefore, The petitioner seeks directions to restore the functionality and ensure that all eligible taxpayers can avail of the rebate as per the legislative mandate.

Read Also: CBDT Issued New Guidelines for Processing of Application for Condonation of Delay in Filing ITR

c. Due date of filing of return under Section 139

• As per Section 139, following are the due dates of filing of ITR for AY 2024-25:

1. Taxpayers, who are liable to get their accounts audited and not required to furnish return under section 92E: 31st October, 2024;
2. Taxpayers who are liable to furnish return under section 92E: 30th November, 2024;
3. All other taxpayers: 31st July, 2024

• Utility to file these returns are provided online by the respondent before the end of financial year to ensure that the taxpayers have sufficient time to comply.
• However, modification of the utility midway through the assessment year has caused undue hardship to taxpayers, particularly those relying on the rebate under Section 87A.

d. Effects of change in utility:

• With effect from 5 July 2024, the amended utility disabled the individual assessee from claiming the rebate under the proviso to Section 87A where tax is levied at special rates such as short term capital gain on equity shares and the assessee opts for the new regime. 
• This has created a scenario where taxpayers, despite being statutorily eligible, are effectively deprived of their entitlements solely due to technical modifications introduced by the respondents.
• Such changes have prompted the petitioner to file the present PIL petition. 

3. Question before Hon’ble High Court

本件において高等裁判所が審理している争点は、所得税法第87条Aの但し書きに基づく控除を申請する法的権利を、ユーティリティ（申告ソフト）の仕様によって奪うことが許されるかという点です。

4. 高等裁判所による分析

高等裁判所は、暫定命令を下すにあたり、以下の通り分析しました。

• 1961年所得税法の下では、納税者自身が所得を計算し、納税額を確定して納税した上で申告を行う「自己申告制度」が採用されています。
• しかし、2024年7月5日付のユーティリティ変更により、多くの納税者が新制度下において、特別税率が適用される所得に対する第87条Aの控除を申請できなくなりました。
• その結果、納税者は本来認められるべき控除額分を過大に納税する事態となりました。
• 申告者は第87条Aに基づく控除を申請する修正申告を行う権利を有しており、これにより還付金の計算が可能となります。
• 期限後申告の最終期限が2024年12月31日であることは明白であり、通常の期限内に申告できなかった納税者にも申告の機会が与えられています。
• 一見して、第87条Aに基づく控除は、納税者の総所得および納税額と本質的に結びついているものです。
• 納税者が法的要件を満たしている限り、その控除を適切に実施する責任は税務当局にあります。
• ユーティリティソフトの変更や税務当局による指示といった手続き上の変更が、控除を受けるという実体的な権利を上回ることはありません。
• 納税者がこの法的利益を享受することを制限する税務当局の作為または不作為は、恣意的であり法の支配に反するものです。
• 第87条Aの立法趣旨を損なうような行政の非効率性や一方的な執行措置の結果を、納税者が負担すべきではありません。
• 法的利益は、立法の目的に沿った形で提供されなければならないことは確立された法理です。

5. 高等裁判所による暫定命令：

高等裁判所は、以下の暫定的な救済措置を命じました。

• 中央直接税務委員会（CBDT）に対し、所得税法第119条に基づき、所得税申告（ITR）の電子申告期限を2024年12月31日から少なくとも2025年1月15日まで延長するよう通知を発行することを命じる。
• これは、第87条Aに基づく控除の対象となるすべての納税者が、手続き上の障害に直面することなく、その法的権利を行使できる機会を確保するためである。