JUDGMENT judgment of court was delivered by M. S. Sonak J.-This petition is directed against order dated May 16, 2006, passed under section 119(2)(b) of Income-tax Act, 1961 ("the said Act"), by Central Board of Direct Taxes (CBDT). By impugned order dated May 16, 2006, petitioner's application dated April 7, 2002, for condonation of delay in filing return of income for assessment year 1997-98 was rejected, resulting in claim for refund of Rs. 6,34,929 not being examined on merits. For assessment year 1997-98, petitioner, which is engaged in business of dealing in artifacts and finances, filed return of income on September 14, 1999, declaring income of Rs. 1,46,000 and claiming refund of Rs. 6,34,929. due date for filing return of income was November 30, 1997, but return was filed on September 14, 1999, i.e., after delay of about 22 months. As there was delay in filing return of income for assessment year 1997-98 beyond period specified under section 139(1) and (4) of said Act, Assessing Officer did not act upon same. On April 7, 2002, petitioner approached Central Board of Direct Taxes under section 119(2)(b) of said Act and sought for condonation of delay in filing return of income for assessment year 1997-98. In application dated April 7, 2002, petitioner stated that at relevant time, office of petitioner company was shifted and certain records including TDS certificates got misplaced/mislaid and considerable time was spent to retrieve same resulting in delay. Central Board of Direct Taxes by its communication dated February 7, 2006, required petitioner to show cause as to why application dated April 7, 2002, seeking condonation of delay be not rejected upon following grounds: (a) That petitioner was "habitual late filer", with view to avoid scrutiny/enquiry; and (b) There do not appear to be any genuine reasons for late filing of return of income. petitioner through its chartered accountant submitted response dated March 21, 2006, to notice dated February 7, 2006, elaborating upon circumstances in which delay was occasioned in filing of return for assessment year 1997-98. In response, reference was made, inter alia, to Central Board of Direct Taxes Circulars as well as decision of this court in case of Bharatiya Engineering Corporation P. Ltd. v. R. G. Deshpande, Addl. CIT [1981] 130 ITR 442 (Bom), urging that liberal approach be adopted in matters of condonation of delay. Central Board of Direct Taxes, by impugned order dated May 16, 2006, has, however, declined to condone delay, inter alia, on following grounds: (a) That audited accounts were prepared by September 14, 1997. However, there is no proper explanation as to why returns came to be filed only on September 14, 1999. Further, there is no explanation as to why application seeking condonation of delay came to be filed only on April 17, 2002. All this, leads to inference that delayed return was only to avoid scrutiny. (b) That no documentary evidence in support of misplacement of TDS certificate by postal authorities on account of change in address of petitioner's company or evidencing delay in receipt of duplicate TDS certificate was produced. Ms. Vissanji, learned counsel for petitioner, submitted that in terms of section 139(1), 139(9), (c)(i) of said Act read with Income-tax Rules, 1962, as in force at relevant time, return of income is required to be accompanied, inter alia, with proof of tax, if any, claimed to have been deducted at source. registered office of petitioner company, was shifted from Somerset House, Warden Road to Poornima, B. G. Kher Marg, which is evident from change of situation of registered office notice dated June 16, 1997. On account of shifting of office, coupled with fact that petitioner company does not have any administrative staff, TDS certificate got misplaced/mislaid and considerable time was spent to retrieve same. Ms. Vissanji further submitted that petitioner company from date of its incorporation, i.e., February 15, 1995, had always filed its returns of income within time permissible under section 139(4) of said Act. Except for assessment year 1996-97, returns filed by petitioner company were accepted, without any scrutiny. Even for assessment year 1996-97, scrutiny assessment order made on February 15, 1998, would bear out that returned income was substantially accepted, with some minor disallowances. In such circumstances, there was neither any material nor any justification to style petitioner as "habitual late filer". Besides, petitioner by its communication dated March 23, 2006, addressed to Central Board of Direct Taxes had made it clear that it has no objection whatsoever to scrutiny assessment for purpose of determining refund and further even instructions issued by Central Board of Direct Taxes contemplated scrutiny in respect of delayed claims of refund. In such circumstances, charge that delay in filing of return was to avoid scrutiny is completely baseless. Ms. Vissanji relying upon undermentioned decisions, submitted that liberal approach is to be adopted in matters of condonation of delay, rather than pedantic or hyper-technical approach, which would defeat legitimate claims of taxpayers. (1) B. M. Malani v. CIT [2008] 306 ITR 196 (SC); (2) R. Seshammal v. ITO [1999] 237 ITR 185 (Mad); (3) Sitaldas K. Motwani v. Director-General of Income-tax [2010] 323 ITR 223 (Bom); (4) Bombay Mercantile Co-operative Bank Ltd. v. CBDT [2011] 332 ITR 87 (Bom). Mr. Pinto, learned counsel for Revenue, submitted that impugned order dated May 16, 2006, is well reasoned and did not warrant any interference. accounts for assessment year 1997-98 had been duly audited by September 14, 1997. In such circumstances, there is no explanation for delay of almost two years in filing return of income. petitioner could have always filed return within time and thereafter invoked provisions of section 154 of said Act to rectify order passed by furnishing TDS certificates, if indeed same had been misplaced or mislaid. shifting of office, as per documentary evidence produced by petitioner itself took place on June 16, 1997. so-called misplacement of documents, on account of shifting did not prove any hindrance in matter of audit of accounts which was completed by September 14, 1997. There is no material produced by petitioner with regard to claim of misplacement of TDS certificates or efforts made by petitioner to retrieve same, including by way of obtaining duplicates. In such circumstances, Central Board of Direct Taxes was justified in drawing inference that delay in filing of returns was to avoid scrutiny. Mr. Pinto submitted that petitioner had failed to make out any case of genuine hardship and there was no explanation for delay of almost two years in filing return of income. Besides it is submitted that there is no explanation for delay of about two years in filing application for condonation of delay with Central Board of Direct Taxes from September 14, 1999, when return of income was filed. In such circumstances, impugned order ought not to be interfered with by this court in exercise of its extraordinary jurisdiction under article 226 of Constitution of India. rival contentions, which now fall for our determination have to be examined in context of section 119(2)(b) of said Act which reads as under: "119. (2)(b) board may, if it considers it desirable or expedient so to do for avoiding genuine hardship in any case or class of cases, by general or special order, authorise any income-tax authority, not being Commissioner (Appeals) to admit application or claim for any exemption, deduction, refund or any other relief under this Act after expiry of period specified by or under this Act for making such application or claim and deal with same on merits in accordance with law;" Central Board of Direct Taxes, in terms of section 119(2)(b) of said Act is vested with powers to admit application or claim for any exemption, deduction, refund or any other relief under said Act after expiry of period specified by or under said Act for making such application or claim and deal with same on merits in accordance with law, where Central Board of Direct Taxes considers it desirable or expedient so to do for avoiding genuine hardship in any case or class of cases. From time to time, Central Board of Direct Taxes has been issuing instructions to effectuate exercise of powers under section 119(2)(b) of said Act, which includes, inter alia, Instruction No. 12 of 2003, dated October 30, 2003. Instruction No. 12 of 2003, inter alia, provides that cases where delayed claims of refunds are being considered would be taken up for scrutiny. This as to ensure that income declared and refund claimed are correct and genuine and also that case is of genuine hardship on merits. Support for above is also found in similar Instruction No. 13 of 2006, inter alia, provides that no interest will be admissible on belated refund claims and for ascertaining correctness of claim could direct Assessing Officer to examine same albeit issued after impugned order. expression "genuine hardship" came up for consideration of Supreme Court in case of B. M. Malani (supra), wherein, by reference to New Collins Concise English Dictionary, Supreme Court accepted position that "genuine" means not fake or counterfeit, real, not pretending (not bogus or merely ruse). Further, genuine hardship would, inter alia, mean genuine difficulty. ingredients of genuine hardship must be determined keeping in view dictionary meaning thereof and legal conspectus attending thereto. For said purpose, another well known principle, namely, that person cannot take advantage of his own wrong, may also have to be borne in mind. Compulsion to pay any unjust dues per se would cause hardship. But question as to whether default in payment of amount was due to circumstances beyond control of assessee, also bears consideration. In case of R. Seshammal (supra), Madras High Court was pleased to observe as under (page 187 of 237 ITR): "This is hardly manner in which State is expected to deal with citizens, who in their anxiety to comply with all requirements of Act pay monies as advance tax to State, even though monies were not actually required to be paid by them and thereafter seek refund of monies so paid by mistake after proceedings under Act are dropped by authorities concerned. State is not entitled to plead hypertechnical plea of limitation in such situation to avoid return of amounts. Section 119 of Act vests ample power in Board to render justice in such situation. Board has acted arbitrarily in rejecting petitioner's request for refund." (emphasis supplied) In case of Sitaldas Motwani (supra), this court has held that expression "genuine hardship" used in section 119(2)(b) of said Act should be construed liberally, particularly in matters of entertaining of applications seeking condonation of delay. This court was pleased to observe as under (page 228 of 323 ITR): "The phrase'genuine hardship' used in section 119(2)(b) should have been construed liberally even when petitioner has complied with all conditions mentioned in Circular dated October 12, 1993. Legislature has conferred power to condone delay to enable authorities to do substantive justice to parties by disposing of matters on merits. expression'genuine' has received liberal meaning in view of law laid down by apex court referred to hereinabove and while considering this aspect, authorities are expected to bear in mind that ordinarily applicant, applying for condonation of delay does not stand to benefit by lodging its claim late. Refusing to condone delay can result in meritorious matter being thrown out at very threshold cause of justice being defeated. As against this, when delay is condoned highest that can happen is that cause would be decided on merits after hearing parties. When substantial justice and technical considerations are pitted against each other, cause of substantial justice deserves to be preferred for other side cannot claim to have vested right in injustice being done because of nondeliberate delay. There is no presumption that delay is occasioned deliberately, or on account of culpable negligence, or on account of mala fides. litigant does not stand to benefit by resorting to delay. In fact he runs serious risk. approach of authorities should be justice oriented so as to advance cause of justice. If refund is legitimately due to applicant, mere delay should not defeat claim for refund." (emphasis supplied) In case of Bombay Mercantile Co-operative Bank Ltd. (supra), this court again observed that it is well settled that in matters of condonation of delay highly pedantic approach should be eschewed and justice-oriented should be adopted. It also observed that party should not be made to suffer on account of technicalities. Applying aforesaid principles to facts and circumstances of present case, we are of opinion, that Central Board of Direct Taxes, in passing impugned order, has adopted unduly technical or pedantic approach. petitioner, at exhibit P to petition has furnished following details with regard to filing of returns from date of its incorporation, i.e., February 15, 1995. M/s. Artist Tree Pvt. Ltd. Details of returns filed Date of incorporation: 15-2-1995 Date Assessment year Intimation issued of filing 31-3- 15-5-97 Served on 1-12- 1995-96 1997 2000 6-10-97 Served on 25-3- 17-9- 1996-97 1998 (Scrutiny assessment order 1997 also passed on 15-2-97) 1997- 14-9-1999 No intimation issued 98 1998- Intimation issued on 20-1- 14-9-1999 99 2000 served on 22-6-2000 No intimation received only 1999- 13-3-2000 ITNS 150A received on 18-12- 2000 2002 2000- 29-3-2001 No intimation received 2001 8-4- 2001-2002 No intimation received 2002 From aforesaid, though it may be true that returns may not have been filed within period specified under section 139(1) of said Act, nevertheless, returns came to be filed in respect of all assessment years (except assessment year 1997-98) within time allowable under section 139(4) of said Act. Further, in all cases, except for assessment year 1996-97, return of income came to be accepted. For assessment year 1996-97, petitioner's case was taken up for scrutiny, however, return was substantially accepted with only some minor disallowances. In light of such facts, Central Board of Direct Taxes was obviously not right in condemning petitioner as "habitual late filer". Further, there is no material to sustain inference that late filing of returns was to avoid scrutiny. petitioner, by its communication dated March 23, 2006, had already made it clear that it had no objection to scrutiny assessment for purposes of determining refund for assessment year 1997-98. Central Board of Direct Taxes instructions, to which reference has been made earlier also provide that cases where delayed claims for refunds are being considered would be taken up for scrutiny. Besides, even provisions of section 119(2)(b) of said Act make it clear that Central Board of Direct Taxes can authorise any income-tax authorities to admit application or claim for any exemption, deduction, refund or any other relief under said Act after expiry of period specified by or under said Act for making such application or claim and to deal with same on merits in accordance with law. expression "deal with same on merits in accordance with law" makes it clear that Central Board of Direct Taxes, even where it authorises Income-tax Officer to admit application or claim made belatedly, would obviously direct its consideration on merits and in accordance with law. In such circumstances, contention of Mr. Pinto, learned counsel for Revenue, that effect of order condoning delay in filing returns, leave Income-tax Officer with no choice but to grant refund as claimed, has no substance. Obviously, it would be well within jurisdiction of such authority to deal with claim on merits and in accordance with law. This court in case of Sitaldas (supra) has explained position in following words (page 229 of 323 ITR): "Whether refund claim is correct and genuine, authority must satisfy itself that applicant has prima facie correct and genuine claim, does not mean that authority should examine merits of refund claim closely and come to conclusion that applicant's claim is bound to succeed. This would amount to prejudging case on merits. All that authority has to see is that on face of it person applying for refund after condonation of delay has case which needs consideration and which is not bound to fail by virtue of some apparent defect. At this stage, authority is not expected to go deep into niceties of law. While determining whether refund claim is correct and genuine, relevant consideration is whether on evidence led, it was possible to arrive at conclusion in question and not whether that was only conclusion which could be arrived at on that evidence." circumstance that accounts were duly audited way back on September 14, 1997, is not circumstance that can be held against petitioner. This circumstance, on contrary adds force to explanation furnished by petitioner that delay in filing of returns was only on account of misplacement or TDS certificates, which petitioner was advised, has to be necessarily filed along with return of income in view of provisions contained in section 139 of said Act read along with Income-tax Rules, 1962, and in particular report in prescribed Forms of return of income then in vogue which required assessee to attach TDS certificates for refund being claimed. explanation furnished is that on account of shifting of registered office, it is possible that TDS certificates which may have been registered office, it is possible that TDS certificates which may have been addressed to earlier office, got misplaced. There is nothing counterfeit or bogus in explanation offered. It cannot be said that petitioner has obtained any undue advantage out of delay in filing of income-tax returns. As observed in case of Sitaldas (supra), there is no presumption that delay is occasioned deliberately or on account of culpable negligence or on account of mala fides. It cannot be said that in this case petitioner has benefited by resorting to delay. In any case when substantial justice and technical consideration are pitted against each other, cause of substantial justice deserves to prevail without in any manner doing violence to language of Act. Mr. Pinto submitted that inordinate delay of two years in filing return of income lands petitioner in arena of laches and, therefore, no relief should be granted to petitioner. principle on which relief is denied to party on grounds of delay or laches is that rights which have accrued to others by reason of delay in filing petition should not be allowed to be disturbed unless there is reasonable explanation for delay. real test to determine delay in such cases is that petitioner should come to court before parallel right is created and that lapse of time is not attributable to any laches or negligence. test is not to physical running of time (Dehri Rohtas Light Railway Company Ltd. v. District Board, Bhojpur [1992] 2 SCC 598). This does not mean or imply that applicant seeking condonation of delay is absolved of requirement to establish genuine hardship and sufficient cause. Similarly, length of delay is not invariably crucial factor. What is really important is acceptability of explanation offered. In every case of delay, there may be some lapse on part of party concerned. That by itself is not ordinarily sufficient to turn down plea or to shut doors against him. If explanation offered does not smack of mala fides or it is not put forth as part of dilatory strategy, court is expected to show utmost consideration to applicant, particularly because refusal to condone delay would result in foreclosing applicant from even putting forth his cause. Once court accepts explanation as sufficient, it is result of positive exercise of discretion and normally superior court should not disturb such exercise, unless same was on wholly untenable grounds or arbitrary or perverse. But it is different matter when court or authority of first instance refuses to condone delay. In such case, superior court would be free to consider cause shown for delay afresh and come to its own finding (N. Balakrishnan v. M. Krishnamurthy [1998] 7 SCC 123). We find that impugned order dated May 16, 2006, of Central Board of Direct Taxes also seeks to reject application for condonation of delay on account of delay from date of filing return of income, i.e., September 14, 1999, up to April 30, 2002. This was not ground mentioned in notice dated February 7, 2006, given to petitioner by Central Board of Direct Taxes for rejecting application for condonation of delay. Thus, petitioner had no occasion to meet same. It appears to be afterthought. However, as pointed out in paragraph 20 hereinabove, delay in filing of application if not coupled with some rights being created in favour of others, should not by itself lead to rejection of application. This is of course upon court being satisfied that there were good and sufficient reasons for delay on part of applicant. Mr. Pinto then submitted that decision in case of Seshammal (supra) is distinguishable, inasmuch as Madras High Court, in said case was concerned with widow seeking refund of paltry amount of Rs. 43,808. Whereas, present case concerns company dealing in artifacts and finances, which has benefit of services of professionals and auditors. This is no manner to distinguish decision. Seshammal (supra) is basically authority for proposition that in matters of condonation of delay, liberal approach needs to be adopted and further State should not ordinarily plead hyper- technical plea of limitation to avoid return of amounts due to assessee. This court, in case of Sitaldas (supra) has understood Seshammal (supra) accordingly. In light of aforesaid discussion, we are of opinion that acceptable explanation was offered by petitioner and case of genuine hardship was made out. refusal by Central Board of Direct Taxes to condone delay was result of adoption of unduly restrictive approach. Central Board of Direct Taxes appears to have proceeded on basis that delay was deliberate, when from explanation offered by petitioner, it is clear that delay was neither deliberate nor on account of culpable negligence or any mala fides. Therefore, impugned order dated May 16, 2006, made by Central Board of Direct Taxes refus ing to condone delay in filing return of income for assessment year 1997-98 is liable to be set aside. Consistent with provisions of section 119(2)(b) of said Act, concerned Income-tax Officer or Assessing Officer would have to consider return of income and deal with same on merits and in accordance with law. We make it clear that we have not examined issue of whether petitioner is indeed entitled to any refund or not, as in our opinion that is matter for concerned Income-tax Officer or Assessing Officer to decide in accordance with law after subjecting return of income to scrutiny assessments. Accordingly, impugned order dated May 16, 2006, made by Central Board of Direct Taxes is set aside. delay in filing return of income for assessment year 1997-98 is condoned and return of income is directed to be admitted for consideration. jurisdictional Income-tax Officer/Assessing Officer is directed to scrutinise return of income and examine claim for refund on merits in accordance with law and grant refund, if petitioner is entitled to same, in accordance with law within period of six months from today. Rule is made absolute to aforesaid extent. There shall be no order as to costs. *** Artist Tree Pvt. Ltd. v. Central Board of Direct Taxe