Bombay Dyeing And Manufacturing v. Deputy Commissioner Of Income Tax

24 wp 1809 of 2019.doc IN THE HIGH COURT OF JUDICATURE AT BOMBAYORDINARY ORIGINAL CIVIL JURISDICTIONWRIT PETITION NO.1809 OF 2019 Bombay Dyeing and ManufacturingCo. Ltd. …Petitioner versusDeputy Commissioner of Income Tax,…TDS-2(3) and Ors. Respondents Mr. Madhur Agarwal I/by Mr. Atul Jasani, for Petitioner.Mr. P.C.Chhotaray, for Respondents. CORAM: AKIL KURESHI & S.J. KATHAWALLA, JJ.DATE: 15th JULY, 2019 P.C.: 1.The Petitioner is facing a demand of short deduction of tax at source, forwhich the Officer has passed an order on 28[th] March, 2019. Against this order, thePetitioner has filed an Appeal which is pending. Pending such appeal, the departmentinsists that the Petitioner must deposit 20% of the disputed amount subject to whichremaining recovery would be stayed. The case of the Petitioner is that for an earlierassessment year 1994-95, pursuant to the Judgment of the Income Tax AppellateTribunal, the Petitioner has to receive sizeable amount of refund which far exceeds the20% of the TDS demand. In a communication dated 3rd May, 2019, the Petitionerconveyed to the Deputy Commissioner of Income Tax (TDS) and showed willingnessfor adjustment of the refund to the extent the TDS demand (20% of the full) was being SSP 1/2 pressed by the department. Since the department did not accept this formula, thisPetition has been filed. 2.Learned Counsel Shri Chhotarary appearing for the Department stated on instructions that prima facie the Petitioner is correct in pointing out that in relation tothe assessment for the assessment year 1994-95, the Petitioner has to receive certainrefund. He however, submitted that unless directed by this Court, such refund cannotbe adjusted against the TDS demand. 3.In the present case, when the Petitioner had showed willingness foradjustment of the part of the refund towards its ad-hoc TDS liable pending appeal, wesee no reason why the department should not adjust the same and release the rest ofthe refund if otherwise payable. The Petitioner has already showed willingness forsuch adjustment under the said letter dated 3rd May, 2019. The Respondents shall actaccordingly on such consent of the Petitioner, adjust to the extent necessary formeeting the requirement of 20% of the TDS demand out of the refund payable. Thiswould comply with the requirement of depositing 20% of the TDS pending appeal toenjoy stay against further recovery. We expect the department even otherwise toprocess the refund and release the balance if any that may become due and payable tothe Petitioner. 4.The Writ Petition is accordingly disposed of. ( S.J.KATHAWALLA, J. ) ( AKIL KURESHI, J. ) SSP 2/2