G.l.naidu v. The Commissioner Of Income Tax -I

IN THE HIGH COURT OF JUDICATURE AT MADRAS CORAM: THE HON'BLE MR. JUSTICE R.MAHADEVAN W.P.No.10700 of 2011 G.L.Naidu ...Petitioner Vs 1. The Commissioner of Income Tax -I, No.68, Race Course Road, Coimbatore – 641 018. 2. The Income Tax Officer, Ward II (2) No.68, Race Course Road, Coimbatore – 641 018. ...Respondents Writ Petition filed under Article 226 of the Constitutionof India praying for issuance of Writ of CertiorarifiedMandamus, calling for the records on the file of the 1[st]respondent in his proceeding in C.No.131(2)/2010-11/CIT-I/CBEdated 30.08.2010, quash the same and further direct the 1[st]respondent herein to refund the excess payment of Rs.51,000/-towards advance tax paid as per the representation made by thepetitioner dated 19.05.2010. For Petitioner :M/s.V.AbarnaFor Respondents: Mr.A.P. Srinivas Senior Standing Counsel According to the petitioner, he is an Income Tax Assesseeon the file of the second respondent. For the assessment year2006-07, he filed his income tax returns admitting the nettaxable income of Rs.3,62,440/- on 31.10.2006 and paid tax tothe tune of Rs.52,768/-. Before filing his returns, he alsopaid advance tax of Rs.51,000/- on 15.03.2006 vide ChallanNo.05293 in Indian Bank, Coimbatore Main Branch. It is thegrievance of the petitioner that at the time of filing thereturns of income, he inadvertently omitted to claim theadvance tax of Rs.51,000/- paid by him. Hence, he submitted apetition on 19.05.2010 seeking to refund the excess tax.However, the said petition came to be rejected by the firstrespondent vide communication dated 30.08.2010. Therefore, thepetitioner has approached this Court with the present writpetition to quash the said communication and consequently,https://hcservices.ecourts.gov.in/hcservices/direct the first respondent to refund the excess payment of Rs.51,000/- towards advance tax, to him. 2.Heard both sides and perused the materials placedbefore this Court. 3.The facts remain that the petitioner filed his incometax returns for the assessment year 2006-07 to the secondrespondent on 31.10.2006 i.e., well within the limitationperiod. Apart from payment of Rs.51,000/- towards advance taxon 15.03.2006, he also paid tax to the tune of Rs.52,768/- on28.10.2006, based on self-assessment. But, he omitted to claimthe advance tax paid, in the income tax returns filed by him.So, he filed the petition dated 19.05.2010 claiming refund ofthe said sum of Rs.51,000/-, which was rejected by the firstrespondent. Hence, this writ petition. 4.On a bare reading of the communication impugned herein,it is seen that without looking into the request made by thepetitioner in a proper perspective, the first respondentrejected the same, considering it as the petition filed underSection 119(2)(b) of the Income Tax Act, seeking to condonethe delay in filing the returns of income, for the assessmentyear 2006-07, that too, without assigning any reason. 5.Section 237 of the Act contemplates refund, which readsas follows:-“S.237 Refunds: "If any person satisfies the Income TaxOfficer that the amount of tax paid by him oron his behalf or treated as paid by him or onhis behalf for any assessment year exceeds theamount with which he is properly chargeableunder this Act for that year be shall beentitled to a refund of the excess." The aforesaid provision makes it clear that if the AssessingOfficer is satisfied that the amount of tax paid by theassessee for any assessment year exceeds the amount with whichhe is properly chargeable under this Act for that year, theassessee be given refund of the excess amount. That apart, interms of Section 240 of the Act, an obligation is cast uponthe revenue to refund the amount to the assessee without hishaving to make any claim in that behalf. "If any person satisfies the Income TaxOfficer that the amount of tax paid by him oron his behalf or treated as paid by him or onhis behalf for any assessment year exceeds theamount with which he is properly chargeableunder this Act for that year be shall beentitled to a refund of the excess." The aforesaid provision makes it clear that if the AssessingOfficer is satisfied that the amount of tax paid by theassessee for any assessment year exceeds the amount with whichhe is properly chargeable under this Act for that year, theassessee be given refund of the excess amount. That apart, interms of Section 240 of the Act, an obligation is cast uponthe revenue to refund the amount to the assessee without hishaving to make any claim in that behalf. 6.In a case, where an assessee chooses to deposit by wayof abundant caution advance tax or self-assessment tax, whichis in excess of his liability on the basis of return furnishedor there is any arithmetical error or inaccuracy, it is opento him to claim refund of the excess tax paid in the course ofassessment proceeding. He can certainly make such a claim alsobefore the concerned authority calculating the refund and theauthority concerned, on being satisfied, shall grantappropriate relief. So, an assessee will not be placed in amore disadvantages position than what he would have been, hadan assessment been made in accordance with law.https://hcservices.ecourts.gov.in/hcservices/ 7.In the present case, the petitioner being a dutifulcitizen, paid the advance tax, in complying with therequirement of the Act. Subsequently, he also paid the self-assessment tax along with his income tax returns for theassessment year in question, well within the prescribed time.As such, he is entitled to receive the excess payment made byway of advance tax. However, the petition filed by him seekingrefund, was rejected by the first respondent, on the ground oflimitation. In the opinion of this Court, such approach on thepart of the first respondent in dealing with the genuine claimof the petitioner / assessee, cannot be countenanced, as thelaw does not permit the revenue to derive benefit by way ofunjust enrichment by not refunding the amount of advance tax,when no tax is due on the part of the assessee. 8.It is obvious that there is some delay on the part ofthe petitioner in approaching the authority concerned to makehis refund claim. That itself would not be a factor to turnout the said plea, when the petitioner paid the tax in excessof the tax liability duly computed on the basis of returnfurnished and the rates applicable, since retention of thesame amounts to violation of Article 265 of the Constitution.It was with a fond hope of getting justice at the hands of thefirst respondent, the petitioner preferred petition seekingrefund of advance tax paid, which was rejected by the firstrespondent under Section 119(2)(b) on the ground oflimitation. 8.It is obvious that there is some delay on the part ofthe petitioner in approaching the authority concerned to makehis refund claim. That itself would not be a factor to turnout the said plea, when the petitioner paid the tax in excessof the tax liability duly computed on the basis of returnfurnished and the rates applicable, since retention of thesame amounts to violation of Article 265 of the Constitution.It was with a fond hope of getting justice at the hands of thefirst respondent, the petitioner preferred petition seekingrefund of advance tax paid, which was rejected by the firstrespondent under Section 119(2)(b) on the ground oflimitation. 9.This Court is of the view that the first respondentought not to have adopted the hyper technical plea oflimitation to avoid return of the advance tax paid by thepetitioner. The higher authorities of the Department to whomsuch powers can be delegated under Section 119 of the Act,need not always take only a pro revenue approach. Theirapproach in such case should be equitious, balancing andjudicious which should reflect the application of mind to thefacts of the case and before denying the genuine claim of theassessee on the ground of mere delay in making such claim.Technically, strictly and literally speaking, the firstrespondent might be justified in denying the refund claim byrejecting such condonation application, but the petitioner,who substantially satisfies the condition for availing suchbenefit, should not be denied the same, merely on the bar oflimitation and therefore, no straight jacket formula orguidelines can be laid down in this regard. Hence, in theinterest of fairness and justice, the first respondent oughtto have considered the petition seeking refund of the advancetax paid by the petitioner. 10.In such view of the matter, the communication dated30.08.2010 sent by the first respondent is liable to bequashed and is accordingly quashed. Consequently, the delay inhttps://hcservices.ecourts.gov.in/hcservices/filing the petition seeking refund of advance tax paid by the petitioner for the assessment year 2006-07 is condoned. Therespondent concerned is directed to consider the refund claimof the petitioner and pass appropriate orders within a periodof four weeks from the date of receipt of a copy of thisorder. 11.This writ petition is allowed in the aforesaid terms.No costs. Sd/-Assistant Registrar(CO)//True copy//Sub Assistant RegistrarrkTo1. The Commissioner of Income Tax -I, No.68, Race Course Road, Coimbatore – 641 018.2. The Income Tax Officer, Ward II (2), No.68, Race Course Road, Coimbatore – 641 018.+1cc to Mr.A.P. Srinivas, Advocate SR.No.23342+1cc to Mr.S.Rajasekar, Advocate SR.No.23427W.P.No.10700 of 2011VSN II(CO)GMY(27/07/2020)