Cwjc/8472/2013 Of Power Grid Corporation Of India Lt v. Commissioner Of Income Tax (Tds)

IN THE HIGH COURT OF JUDICATURE AT PATNACivil Writ Jurisdiction Case No.8472 of 2013 ====================================================== Power Grid Corporation of India Limited, a government company incorporated under the Companies Act having its registered office at B-9, Qutab Institutional Area, P.O. and P.S.- Katwaria Sarai, New Delhi- 110016 and Eastern Region Transmision Systems-1, H.Q. at Alankar Place, P.O.-Boring Road, P.S.- Srikrishnapuri, Dsitrict- Patna, through its Dy. General Manager (Commercial) ER-I, Sri A.K. Verma, S/o Late Vishwanath Prasad Verma, R/o I.A.S. Colony, Bailey Road, Patna P.O.- Danapur Cantt., P.S.- Rupaspur, District-Patna .... .... Petitioner Versus 1. Commissioner of Income Tax (TDS) having its office at 5th Floor, Central Revenue Building (Annexe), Beerchand Patel Marg, Patna 2. Assistant Commissioner of Income Tax (TDS) Circle having its office at 6th Floor, Central Revenue Building (Annexe), Beerchand Patel Marg, Patna 3. Bihar State Electricity Board (now known as Bihar State Power (Holding) Co. Ltd.) having its office at Vidyut Bhawan, Bailey Road, Patna .... .... Respondents ====================================================== Appearance : ====================================================== CORAM: HONOURABLE THE CHIEF JUSTICE and HONOURABLE MR. JUSTICE ASHWANI KUMAR SINGH ORAL ORDER (Per: HONOURABLE THE CHIEF JUSTICE) 8. 20-9-2013 This Petition under Article 226 of the Constitution has been filed by the Power Grid Corporation of India Limited (hereinafter referred to as “the Corporation”), an assessee under the Income-tax Act, 1961 (hereinafter referred to as “the Act”). It is the grievance of the Corporation that although the Corporation has paid its taxes regularly and no demand for tax is pending against the Corporation, the respondent no.3, Bihar State Electricity Board (hereinafter referred to as “the Board”) has recovered a sum of Rs.11,61,20,158.00 for the financial years 2003-04 to 2008-09 deducted under Sections 194C and 194J of the Act. It appears that the Corporation had a contract with the Board. In course of the said contract, the Corporation had received certain money from the Board. The matter at issue is the tax to be deducted at source by the Board. The respondent authorities have recovered a sum of Rs.11,61,20,158.00 from the Board, being the amount required to be deducted at source from the contractual amount paid to the Corporation. Although the Board has challenged the said order and is pending before the Income Tax Appellate Tribunal, it is not in dispute that the Board has recovered the said amount from the Corporation. It is also not in dispute that whatever amount was received by the Corporation from the Board in the relevant financial years, such amounts were assessed and proper taxes were paid on such amount. Thus, it is apparent that the Corporation has suffered a double jeopardy. Learned advocate Mr. D.V. Pathy has appeared for the Corporation. He has relied upon the judgment of the Hon’ble Supreme Court in the matter of Hindustan Coca Cola Beverage 3 P. Ltd. v. Commissioner of Income Tax, ([2007] 293 ITR 226 (SC)). He has submitted that as held by the Hon’ble Supreme Court and in accordance with the Circulars issued by the Central Board of Direct Taxes, the respondent authorities are under obligation to refund the aforesaid sum of Rs.11,61,20,158.00. Petition is contested by the learned counsel Mr. Harshwardhan Prasad appearing for the respondent authorities. He has relied upon the judgments of the Bombay and Kerala High Courts in the matters of Sitaldas K. Motwani v. Director General of Income Tax and Others, ([2010] 323 ITR 223 (Bom)); and of Pala Marketing Co-operative Society Ltd. v. Union of India and Others, ([2009] 311 ITR 177 (Ker.)). He has submitted that the petitioner has a remedy before the Central Board of Direct Taxes under Section 119(1)(b) of the Act. Petition is contested by the learned counsel Mr. Harshwardhan Prasad appearing for the respondent authorities. He has relied upon the judgments of the Bombay and Kerala High Courts in the matters of Sitaldas K. Motwani v. Director General of Income Tax and Others, ([2010] 323 ITR 223 (Bom)); and of Pala Marketing Co-operative Society Ltd. v. Union of India and Others, ([2009] 311 ITR 177 (Ker.)). He has submitted that the petitioner has a remedy before the Central Board of Direct Taxes under Section 119(1)(b) of the Act. Learned advocate Mr. Sudhir Kumar Narayan has appeared for the respondent no.3, the Bihar State Electricity Board. He has submitted that the aforesaid sum of Rs.11,61,20,158.00, demanded by the authorities, has been paid by the Board to the respondent authorities. No refund, therefore, can be claimed from the Board. Learned counsel Mr. Harshwardhan Prasad has not been able to contest the statement that the Corporation has suffered double jeopardy and that the Corporation has paid up its dues for the financial years 2003-04 to 2008-09; nor does he dispute that no demand is pending against the Corporation for the said years. In the aforesaid circumstances, it being a clear and indisputable case of double jeopardy, we direct the respondent authorities to refund the aforesaid sum of Rs.11,61,20,158.00 to the petitioner. The refund amount shall be paid within six weeks from today. Petition stands allowed in the above terms. Registry will send copy of this order to the respondent nos. 1 and 2 forthwith. (R.M. Doshit, CJ) Pawan/- (Ashwani Kumar Singh, J)