This is Part 2 of a two-part series on the Delhi High Court's rulings in the matter of Delhi Maharashtriya Educational and Cultural Society. Part 1 covered ITA No. 373/2025, which settled that ITAT has no jurisdiction over Section 119(2)(b) condonation orders. Part 2 covers what followed for the Society before the High Court.
The Delhi High Court's ruling in ITA No. 373/2025 went against the Society on the question of ITAT's jurisdiction. But the Society had not limited itself to ITAT. It had separately filed a writ petition before the High Court under Article 226, challenging the same rejection order. That petition was still alive.
What followed from there is instructive, both for what it reveals about the correct legal remedy available to charitable trusts in such situations and for what it demonstrates about the consequences when a statutory authority fails to genuinely comply with a judicial remand.
The First Writ Petition
In W.P.(C) 15601/2025, the Society placed the following facts before the Delhi High Court. Its audit report in Form 10B was prepared and ready as of September 30, 2018. Its return of income for AY 2018-19 was filed on October 31, 2018, the last date for filing. The Form 10B, though available, was not uploaded along with the return due to an inadvertent omission. Upon realising the error, the Society uploaded the form on November 16, 2018, sixteen days after the due date.
The CIT (Exemptions) had rejected the condonation application on June 14, 2024, holding that the sixteen-day delay was not justified. That rejection formed the basis of the writ petition.
The Court, in its judgment dated October 28, 2025, examined the law and the facts in detail. It held that the delay was bona fide. The audit report pre-existed the filing date. The return was filed on time. The delay was confined to a portal upload and was inadvertent in nature. The Court found that the refusal to condone such a delay could not be sustained.
However, rather than allowing the application outright at that stage, the Court remanded the matter to the CIT (Exemptions) with a direction to reconsider it with objectivity. The expectation was that the authority, guided by the Court's analysis, would approach the matter afresh and grant the necessary relief.
What the Authority Did on Remand
The CIT (Exemptions) passed a fresh order on December 17, 2025.
When the Society examined that order, it found that the authority had reproduced the earlier rejected order almost entirely, word for word, with no substantive change in reasoning or conclusion. The only additions were a new date and the phrase "In light of the Hon'ble High Court's Order and considering the facts of the case" placed at the opening.
Nothing else had changed.
The Second Writ Petition and the Court's Response
The Society filed W.P.(C) 3651/2026. The matter came before Justice Dinesh Mehta and Justice Vinod Kumar.
The Court opened its order by observing that it was "a sorry state of affairs" that the Society had been compelled to approach the Court again, within six months, for a grievance that should have been resolved at the departmental level itself. It examined the December 17, 2025 order and found that the authority had simply reproduced the previous order with cosmetic modifications. The Court recorded its shock at seeing such an order passed by an officer of the rank of Commissioner of Income Tax.
The impugned order was set aside. Critically, the Court declined to remand the matter a second time.
The Relief Granted
The Court allowed the Society's application under Section 119(2)(b) directly. The sixteen-day delay in uploading Form 10B was condoned. The Form 10B was directed to be treated as having been filed along with the return.
The intimation order dated March 23, 2020 under Section 143(1), which had raised a demand of Rs. 2,23,53,562 against the Society by denying exemption under Sections 11 to 13 of the Act, was set aside. The rectified intimation order dated December 24, 2021 under Section 154 was also set aside. The Assessing Officer was directed to pass a formal order of NIL demand within four weeks from March 20, 2026.
The Court's Observations on the Authority's Conduct
The Court was measured but pointed in its observations. It clarified that the December 17, 2025 order was not set aside on grounds of malice, but on the ground that it was an affront to the High Court's earlier order in the Society's first writ petition. There is an important distinction there. The Court was not attributing improper motive to the Commissioner. It was holding that a judicial direction to reconsider cannot be discharged by reproducing the very order that has been set aside.
The Court also made a broader observation that deserves attention. It held that the authority deciding applications under Section 119(2)(b) should focus on mitigating genuine hardship to assessees and should exercise objectivity, rather than being driven by revenue considerations. In a case where procedural inflexibility led to a demand of over Rs. 2.23 crore against a charitable institution for a sixteen-day upload delay, that observation carries particular weight.
Practical Takeaways for Charitable Organisations
Reading Part 1 and Part 2 together, the position for charitable trusts facing Form 10B condonation rejections is now considerably clearer.
ITAT is not the right forum. A writ petition before the jurisdictional High Court under Article 226 is the correct remedy. That route is not merely theoretical. The DMECS case demonstrates that where the facts genuinely support condonation, the High Court will grant it.
The quality and specificity of the condonation plea matters significantly at the writ stage. A clear record showing that the delay was inadvertent, that the audit report existed before the due date, and that the return was filed on time will carry far more weight than a general averment of oversight.
Finally, and this point has implications beyond just Form 10B cases, when a Court remands a matter with a specific direction, the authority must engage with that direction in substance. A formal compliance that leaves the outcome unchanged is not a reconsideration. As this case makes clear, the consequence of such an approach is that the Court may decide to step in and resolve the matter itself, without giving the authority a further opportunity.
The Society filed its return on time. Its audit report was ready well before the due date. The delay was sixteen days and confined entirely to a portal upload. It took until March 20, 2026 to obtain a NIL demand certificate. That timeline reflects the cost of a system where the first-stage authority exercises discretion inflexibly, and where correcting that inflexibility requires repeated litigation before the High Court. The judgment in W.P.(C) 3651/2026 is a clear signal that such an approach will not be allowed to stand.