Supreme Court to Decide IT Dept’s Scope to Condone 30 Months Delayed ITR Under Section 119(2)(b)

The Supreme Court of India is about to clarify whether the Income Tax Department has the authority to accept late-filed ITRs (Income Tax Returns) by 30 months under Section 119(2)(b) of the Income Tax Act, 1961.

M/s Sirez Limited filed a Special Leave Petition against the Union of India and others in the Supreme Court of India. The key issue raised is whether the Income Tax Department is allowed to condone delayed Income Tax Returns (ITRs) under the Income Tax Act, 1961. The present case pertains to the Assessment Year 2018-2019.

The present matter has originated from an order dated December 8, 2025, passed by the Delhi High Court. The judgement was announced on February 10, 2026, by a bench consisting of the honourable Justice J.B. Pardiwala and Justice K.V. Viswanathan.

Basically, the petitioner in the current case had lately filed its income tax return (ITR) 30 months before the Assessment Year 2018-19. So, the petitioner filed an application before the Central Board of Direct Taxes (CBDT) under Section 119(2)(b) of the Income Tax Act, 1961, seeking condonation of delay. However, the CBDT rejected the said application, disallowing the petitioner’s request to condone the delay.

This aforesaid denial of condonation of delay led to the denial of two key benefits to the petitioner, i.e., first, the carry forward of a business loss of Rs. 1.06 crore and second, the refund/credit of Tax Deducted at Source (TDS) of Rs. 19.73 lakh. Now, the key issue raised before the Supreme Court is whether delay in filing an income tax return can be condoned under Section 119(2)(b) of the Income Tax Act, 1961.

The court has issued notice in the matter and directed the petitioner’s Advocate-on-Record to submit all the relevant documents to the learned Additional Solicitor General. The case is still pending; a hearing is scheduled for March 9, 2026.