M/S. Randstad India Pvt. Ltd., Rep. By Its Director, Mr. Viswanath Pudukkod v. The Deputy Commissioner Of Income Tax, Large Tax Payer Unit

IN THE HIGH COURT OF JUDICATURE AT MADRAS Date of Reserving the OrderDate of Pronouncing the Order16.11.201724.11.2017Coram The Hon'ble Mr.Justice T.S.Sivagnanam Writ Petition Nos. 22665 & 22666 of 2017 andW.M.P.No.23767 and 23768 of 2017 M/s. Randstad India Pvt. Ltd.,rep. by its Director, Mr. Viswanath Pudukkod, ...Petitioner in both W.P.Nos.Vs. The Deputy Commissioner of Income Tax,Large Tax Payer Unit-1,7th Floor, Wanaparthy Block,121, Mahatma Gandhi Road,Chennai - 600 006. ...Respondent in both W.P.Nos. Prayer in W.P.No.22665 of 2017Writ Petition, filed under Article 226 of the Constitutionof India, for issuance of Writ of Mandamus, directing therespondent to expeditiously process and issue the refund inrespect of the petitioner's income tax returns for the impugnedAY 2015-16, amounting to Rs.57,93,34,888/- and eligible interestunder Section 244 A of the Act. Prayer in W.P.No.22665 of 2017: Writ Petition, filed under Article 226 of the Constitutionof India, for issuance of Writ of Mandamus, directing therespondent to expeditiously process and issue the refund inrespect of the petitioner's income tax returns for the impugnedAY 2016-17, amounting to Rs.69,16,73,070/- and eligible interestunder Section 244 A of the Act. For Petitioner in : Mr. P.S. Raman, Senior Counselboth WP's for Mr. R. SivaramanFor Respondent in : Mrs. Hema Murali Krishnanboth WP's Senior Standing Counsel for Income Tax Both the Writ Petitions have been filed for anidentical relief, i.e. praying for a direction upon therespondent to expeditiously process the refund claim made by thepetitioner, and issue refund in respect of the petitioner'sincome tax returns for the assessment years 2015-16 and 2016-17,together with eligible interest under Section 244 A of theIncome Tax Act, 1961 (hereinafter, referred to as 'the Act'). 2. The petitioner is a Private Limited Company,incorporated under the Companies Act, 1956, and wholly ownedsubsidiary of M/s. Randstad Asia Pacific B.V Netherlands, andis engaged in the business of providing various services in thecore areas of recruitment, human resource solutions, etc. Thereturns filed by the petitioner under the Act for the previousyears were subjected to scrutiny assessment, and orders werepassed under Section 143 (3) of the Act. It is stated that, asresult of the scrutiny assessment undertaken in the prior years,the losses claimed by the petitioner, in its tax return havemarginally reduced. 2.1) It is stated that, the income, the petitionerearns from carrying out its business, are generally subject towithholding tax at a gross level, predominantly under Section194 J and Section 194 C of the Act. As the petitioner wasincurring loss for successive assessment years, Applicationswere filed with the respondent for every year to issue NILdeduction certificates under Section 197 of the Act. Thoughthe respondent had issued such certificate for the respectiveassessment years, the time between the date of Application tillthe date of issuance of certificate, resulted in taxes beingdeducted by the customers in the interim period, leading toaccumulation of Tax Deducted at Source (TDS) credit. 2.2) The petitioner would further state that, on accountof the substantial tax losses, there has been no tax liabilityfor the petitioner, and the entire amount of TDS by itscustomers has been claimed as refund. It is stated that, inaddition to the refund for the years 2009-10 to 2014-15, thepetitioner has TDS credit of Rs.107, 49, 80, 415, which would beclaimed as refund, while filing its return of income due byNovember, 30, 2017. It is stated that the respondent hadissued notice under Section 143 (2) of the Act, dated04.07.2016, for initiation of scrutiny assessment, for theassessment years 2015-16. 2.2) The petitioner would further state that, on accountof the substantial tax losses, there has been no tax liabilityfor the petitioner, and the entire amount of TDS by itscustomers has been claimed as refund. It is stated that, inaddition to the refund for the years 2009-10 to 2014-15, thepetitioner has TDS credit of Rs.107, 49, 80, 415, which would beclaimed as refund, while filing its return of income due byNovember, 30, 2017. It is stated that the respondent hadissued notice under Section 143 (2) of the Act, dated04.07.2016, for initiation of scrutiny assessment, for theassessment years 2015-16. 2.3) The respondent failed to process the return of incomefiled by the petitioner for the assessment years 2015-16 and https://hcservices.ecourts.gov.in/hcservices/ 2016-17, under Section 143 (1) of the Act, and grant the refunddue to the petitioner, as claimed in its return of income. Thepetitioner, therefore, filed Applications on 20.07.2017,requesting the respondent to process the return of income forthe assessment years 2015-16 and 2016-17, and grant refund alongwith consequential interest. This was followed by reminders,dated 03.08.2017. As the respondent has not considered therequest placed by the petitioner, for processing the return ofincome for the assessment year 2015-16 and 2016-17, thepetitioner has approached this Court, by way of these WritPetitions, for issuing necessary directions in this regard. 3. Mr.P.S. Raman, the learned Senior Counsel for Mr.R.Sivaraman, the learned counsel for the petitioner would submitthat, Central Board of Direct Taxes (CBDT) issued aNotification, vide Instruction No.1 of 2015, dated 13.01.2015,to all the Assessing Officers, directing that, processing of taxreturns cannot be undertaken after issuing notice under Section143 (2) of the Act. The validity of this Instruction No.1 of2015, was challenged before the Hon'ble High Court of Delhi, inthe case of Tata Teleservices Ltd., Vs. Central Board of DirectTaxes and the Hon'ble Division Bench, by a judgment, reported in(2016) 240 Taxman 182 (Delhi), quashed the aforesaid instructionissued by CBDT. The decision in Tata Teleservices Ltd.'s case(supra) was followed by the High Court of Delhi, in the case ofIndus Towers Ltd., Vs. Union of India, in W.P.(C) No.3665 of2015, dated 06.10.2016. In the said decision, it has beenreiterated that the refund claim should be considered, despitescrutiny notices, having been issued under Section 143 (2) ofthe Act. 4.Further, it is submitted that, from the language usedin Section 143 (1 D), it could be inferred that the AssessingOfficer has discretionary powers to process the returns andgrant resultant refund due to the assessee, even in the case,where, scrutiny assessment has been initiated by issuing noticeunder Section 143 (2) of the Act. Therefore, the respondentought to have expedited the refund due to thepetitioner/assessee. 5.It is submitted that, for the assessment year 2014-15,the respondent committed an error, and demanded interest underSection 234 (3) at Rs.46,47,82,586/-, and thereby, denied therefund. The petitioner filed a Petition under Section 154 ofthe Act, for rectification of the error for the assessment yearfor the years 2014-15, and the respondent accepted the mistake,stating that, loss was not considered in the assessment order,and accordingly, passed an order on 20.04.2017, stating that thepetitioner is entitled to refund of Rs.54,47,71,095/-.Therefore, the petitioner, for the subsequent assessment year, had approached the Authority, well in advance, to process thereturn of income under Section 143 (1) of the Act, to enable thepetitioner to secure refund. 5.It is submitted that, for the assessment year 2014-15,the respondent committed an error, and demanded interest underSection 234 (3) at Rs.46,47,82,586/-, and thereby, denied therefund. The petitioner filed a Petition under Section 154 ofthe Act, for rectification of the error for the assessment yearfor the years 2014-15, and the respondent accepted the mistake,stating that, loss was not considered in the assessment order,and accordingly, passed an order on 20.04.2017, stating that thepetitioner is entitled to refund of Rs.54,47,71,095/-.Therefore, the petitioner, for the subsequent assessment year, had approached the Authority, well in advance, to process thereturn of income under Section 143 (1) of the Act, to enable thepetitioner to secure refund. 6. Further, it is submitted that, the Hon'ble HighCourt of Bombay, in the case of Group M. Media India (P) Ltd.Vs. Union of India, reported in [(2017) 77 Taxmann. com 106(Bombay) considered an identical factual situation, and issued adirection to the Assessing Officer to consider therepresentation and dispose of the same within the time frame.The observation made in the judgement, more particularly, inpara Nos.9 and 10 would squarely apply to the facts of thepresent cases. 7.It is further submitted that, quite recently, theHon'ble High Court of Gujarat, in the case of CorrtechInternational (P) Ltd. Vs. Deputy Commissioner of Income Tax,reported in [(2017) 86 taxmann. com 156 (Gujarat)], consideredthe scope of Section 143, as it stood prior to the amendment byvirtue of the Finance Act, 2017, and issued direction to theAssessing Officer to complete the process of the assessee'sreturn of income under Section 143 (3) of the Act, and if anyrefund arises out of said exercise, ordered to grant the same tothe assessee, as per the statutory provisions. With the abovesubmissions, the learned Senior Counsel prays for appropriatedirection to the respondent to grant the refund. 8.Mrs. Hema Murali Krishnan, the learned Senior StandingCounsel for the respondent/Revenue submitted that, thepetitioner's assessment for the year 2015-16 was selected forscrutiny, and notice under Section 143 (2) of the Act was issuedon 04.07.2016. However, in view of an embargo created bySection 143 (1 D) of the Act, the return cannot be processedunder Section 143 (1). Therefore, it is submitted that therespondent, thought it fit as unnecessary to process the returnunder Section 143 (1) of the Act. 9. Further, by referring to second proviso to Section143 (1) of the Act, it is submitted that, no intimation underthe said sub-section shall be sent after the expiry of the oneyear from the end of the financial year, in which, return ismade. For the return of income for the assessment year 2015-16(FY), the one year period expired on 31.03.2017. Further, theApplications, dated 20.07.2017, submitted by the petitioner wereafter issuance of scrutiny assessment, and since the respondentis in the process of adjudicating the assessment on merits, noaction was taken on the Applications, dated 20.07.2017.Further, it is submitted that, it is incorrect to state that therespondent is not processing the return filed under Section 143(1) based on the CBDT Instruction No.1, dated 13.01.2015, but has done so, in the light of the embargo under Section 143 (1D). 10. It is further submitted that the respondent hasnever acted arbitrarily and has objectively analyzed the matterand has given certificate under Section 197 for lower deductionof tax at source to the petitioner after duly considering theprofitability situation of the petitioner. It is furthersubmitted that, for the assessment year 2015-16 , it has beenselected for scrutiny, and notice under Section 143 (2) wasissued on 03.07.2017, and in view of the embargo created bySection 143 (1 D) of the Act, return has not been processedunder Section 143 (1). has done so, in the light of the embargo under Section 143 (1D). 10. It is further submitted that the respondent hasnever acted arbitrarily and has objectively analyzed the matterand has given certificate under Section 197 for lower deductionof tax at source to the petitioner after duly considering theprofitability situation of the petitioner. It is furthersubmitted that, for the assessment year 2015-16 , it has beenselected for scrutiny, and notice under Section 143 (2) wasissued on 03.07.2017, and in view of the embargo created bySection 143 (1 D) of the Act, return has not been processedunder Section 143 (1). 11. Heard Mr. P. S. Raman, the learned Senior Counselappearing for Mr. R. Sivaraman, the learned counsel for thepetitioner, Mrs. Hema Murali Krishnan, the learned SeniorStanding Counsel for the respondent, and perused the materialplaced on record. 12.The petitioner has filed these two Writ Petitions fora direction to expedite the refund claim made by the petitionerby processing their return of income for the assessment years2015-16 and 2016-17 under Section 143 (1) of the Act. Earlier,CBDT had issued Instruction No.1 of 2015, dated 13.01.2015,stating that, considering unambiguous language of the relevantprovisions and the intention of law, CBDT, in exercise of thepowers conferred on it, under Section 119 of the Act, clarifiesthat the processing of a return cannot be undertaken afternotice has been issued under sub-section 2 of Section 143 of theAct. However, it shall be desirable that scrutiny assessmentsin such cases are completed expeditiously. This instructionissued by CBDT was challenged in a batch of cases before theHon'ble High Court of Delhi, in Tata Teleservices Ltd.'s case(supra). The Hon'ble Division Bench quashed the saidInstruction. At this stage, it would be relevant to refer tocertain paras of the judgment, which is extracted as hereunder:- “ “ 8. It is evident that Section143 (1D) in the manner it is worded gives adiscretion to the Assessing Officer („AO") todecide whether the return of income has to beprocessed where a notice has been issuedunder Section 143 (2) of the Act. It issignificant that sub-section (1D) wasinserted in Section 143 subsequent to theinsertion of sub-section (1A) which providesfor centralised processing of returns. Underthe Scheme framed by the CBDT in 2011 interms of Section 143(1A), there is acomputerized random selection of returns which might be taken up for scrutiny. Thusthe discretion regarding picking up a returnfor scrutiny is no longer left with theAO. Section 143(1D), however, continues theelement of discretion in the AO when itstates that the processing of return "shallnot be necessary". In other words, it doesnot expressly state that the return shall notbe processed where a notice has been issuedto the Assessee under Section 143(2) of theAct. which might be taken up for scrutiny. Thusthe discretion regarding picking up a returnfor scrutiny is no longer left with theAO. Section 143(1D), however, continues theelement of discretion in the AO when itstates that the processing of return "shallnot be necessary". In other words, it doesnot expressly state that the return shall notbe processed where a notice has been issuedto the Assessee under Section 143(2) of theAct. 9. However, despite terming the languageof Section 143(1D) to be "unambiguous" theCBDT felt that it required clarification.This led to the CBDT issuing the impugnedInstruction dated 13th January 2015under Section 119 of the Act. The saidinstruction inter alia states that somedoubts have been expressed in view of thewords "shall not be necessary" usedin Section 143(1D) of the Act and that in thelight of the explanatory note in the FinanceAct, 2012 (which has been referred tohereinbefore) "the legislative intent is toprevent the issue of refund after processingas scrutiny proceedings may result in demandfor taxes on finalisation of the assessmentsubsequently" (emphasis supplied). Thecircular then proceeds to state as under:"4.Consideringtheunambiguous languageof therelevantprovisionandtheintention of law as discussedabove, the Central Board of DirectTaxes, in exercise of the powersconferred on it under section 119of the Act hereby clarifies thatthe processing of a return cannotbe undertaken after notice hasbeen issued under sub-section (2)of section 143 of the Act. Itshall, however, be desirable thatscrutiny assessments in such casesare completed expeditiously. 5. This may be brought to thenotice of all concerned for strictcompliance.” 16. Indeed, as already noticed at thetime the present petition was filed, aaggregate figure of the refund that thePetitioner was owed for the four AYs i.e.2012-13 to 2015-16 was to the tune ofRs.733.73 crores. This is a very substantialfigure considering the huge losses that thePetitioner has been suffering over theyears. Section 119 of the Act, on thestrength of which the impugned Instructionhas been issued by the CBDT, no doubt enablesthe CBDT to issue "such orders, instructionsand directions" to the income tax authorities"for the proper administration of this Act".However, this power of the CBDT is hedged inby certain limitations. One such limitationis provided in a proviso to Section 119(1) oftheAct.Theotherlimitationis under Section 119(2) of the Act where itis mentioned that the direction orinstructions issued by the CBDT should not be"prejudicial to assessees". 17. The idea of vesting the CBDT withthe above power is to ensure that there is anease of administration of the Act and thatambiguities in the practice and procedure mayget clarified. At the same time it has to beensured that such instructions or orders donot add to the difficulties of the taxpayers. Circulars, orders and instructionsissued by the CBDT underSection 119 of theAct, to the extent they are beneficial to theAssessees are binding on the Department. Ifthey are prejudicial to the tax payer, thenthey cannot prevail over the statute, whichdoes not envisage such harsher measure. 23. The real effect of the instructionis to curtail the discretion of the AO by 17. The idea of vesting the CBDT withthe above power is to ensure that there is anease of administration of the Act and thatambiguities in the practice and procedure mayget clarified. At the same time it has to beensured that such instructions or orders donot add to the difficulties of the taxpayers. Circulars, orders and instructionsissued by the CBDT underSection 119 of theAct, to the extent they are beneficial to theAssessees are binding on the Department. Ifthey are prejudicial to the tax payer, thenthey cannot prevail over the statute, whichdoes not envisage such harsher measure. 23. The real effect of the instructionis to curtail the discretion of the AO by 'preventing' him from processing the return,where notice has been issued to the Assesseeunder Section 143(2) of the Act. If thelegislative intent was that the return wouldnot be processed at all once a notice isissued under Section 143 (2) of the Act, thenthe legislature ought to have used expresslanguage and not the expression "shall not benecessary". By the device of issuing aninstruction in purported exercise of itspower under Section 119 of the Act, the CBDTcannot proceed to interpret or instruct theincome tax department to „prevent" the issueof refund. In the event that a notice isissued to the Assessee under Section 143 (2)of the Act, it will be a matter thediscretion of the concerned AO whether heshould process the return. 24. Consequently, the Court is of theview that the impugned Instruction No.1 of2015 dated 13th January 2015 issued by theCBDT is unsustainable in law and it is herebyquashed. It is directed that the saidinstruction shall not hereafter be reliedupon to deny refunds to the Assessees inwhose cases notices might have been issuedunder Section 143(2) of the Act. The questionwhether such return should be processed willhave to be decided by the AO concernedexercising his discretion in terms of Section143 (1D) of the Act.” ” 13.In the light of the above decision, the AssessingOfficer cannot fall back on the Instructions given by CBDT, andrefuse to process the return under Section 143 (1). In fact,this Instruction has been cited by the petitioner to state that,it is one of the grounds, on which, the return has not beenprocessed under Section 143 (1) of the Act. 14.The respondent has filed a counter affidavit, clearlystating that, he has not been influenced or guided by the CBDT'sInstructions and is aware that Instruction has been quashed.It is the case of the respondent that, in exercise of hisdiscretionary powers and in the light of the legal embargo underSection 143 (1 D) of the Act, the return cannot be processed https://hcservices.ecourts.gov.in/hcservices/ under Section 143 (1). 15.Some what similar stand was taken before the Hon'bleHigh Court of Bombay, in the case of Group M. Media India (P)Ltd. (supra) and the action of the Officer in not processing therefund claim under Section 143 (1) was noted and the Courtobserved as follows :- 14.The respondent has filed a counter affidavit, clearlystating that, he has not been influenced or guided by the CBDT'sInstructions and is aware that Instruction has been quashed.It is the case of the respondent that, in exercise of hisdiscretionary powers and in the light of the legal embargo underSection 143 (1 D) of the Act, the return cannot be processed https://hcservices.ecourts.gov.in/hcservices/ under Section 143 (1). 15.Some what similar stand was taken before the Hon'bleHigh Court of Bombay, in the case of Group M. Media India (P)Ltd. (supra) and the action of the Officer in not processing therefund claim under Section 143 (1) was noted and the Courtobserved as follows :- " The action of the officer on the groundurged seems to be in complete variance withthe higher echelons of administration of thetax administration being an assesseefriendly regime. In fact, the CBDT hasitself issued Instruction No.7 of 2012,dated 1st August, 2002, wherein, they havespecifically directed the officers of theRevenue to process all the returns, inwhich, refunds are payable expeditiously.Similarly, as late as in 2014, in theCitizen's Charter issued by the Income TaxDepartment in its vision statement statesthat the Department aspires to issue refundsalong with interest under Section 143 (1) ofthe Act, within six months from the date ofelectronically filing the returns. In thiscase, the return was filed on 29th November,2015, yet there is no reason as to why theAssessing Officer has not processed therefund and taken a decision to grant or notgrant a refund under Section 143 (1 D) ofthe Act. This attitude on the part of theAssessing Officer leaves us with a feeling(not based on any evidence) that theOfficers of the Revenu seem to believe that,it is not enough for the assesssee to pleasethe deity (Income Tax Act) but the assesseemust also please the priest (Income TaxOfficer) before getting what is due to himunder the Act. The officers of the Statemust ensure that their conduct does not giverise to the above feeling even remotely" Ultimately, the Bombay High Court issued a direction to considerthe representation made by the petitioner within a time frame. 16.As pointed out earlier, the petitioner has filed theseWrit Petitions for two assessment years (2015-16 & 2016-17).It has to be seen as to whether the embargo under Section 143 (1D) would operate for both the assessment years. https://hcservices.ecourts.gov.in/hcservices/ 17.In terms of Section 143 (1 D), as it stood prior toits substitution w.e.f. 01.04.2017, the processing of a returnunder Section 143 (1) shall not be necessary before expiry ofthe period specified under second proviso to sub-section 1,wherein, notice has been issued to the assessee under sub-section 2. Second proviso to Section 143 (1) states that, nointimation under sub-section 1 shall be sent after the expiry ofthe one year from the end of the financial year, in which, thereturn is made. So far as the assessment year 2015-16 isconcerned, the outer time limit for processing of return hasexpired by July, 2017, after which, the respondent isstatutorily prevented from processing the return under Section143 (1). However, this problem does not arise, insofar as theassessment for the year 2016-17 is concerned. 18.Thus, considering the law laid down by the Hon'bleHigh Courts of Delhi, Bombay and Gujarat respectively, in theaforementioned decisions and taking note of the fact that thepetitioner had suffered at the hands of the Assessing Officerfor the assessment year 2014-15, as the Assessing Officercommitted a glaring error by treating the petitioner's loss, asif it is an income and demanding tax for the assessment year2015-16, thereby, wiping out the refund claim made by thepetitioner, which error, the petitioner was able to set rightonly in 2017, and the Assessing Officer having accepted themistake and passed an order under Section 154 of the Act, andgranted refund of Rs.54,47,71,095, it would be a fit case,where, appropriate direction should be issued to the respondent. 19.In Corrtech International (P) Ltd. (supra), a more orless, identical issue arose for consideration before the Hon'bleHigh Court of Gujarat, wherein, the petitioner prayed for adirection to the respondent to release the refund in theirfavour for the assessment years 2015-16 and 2016-17. In thesaid case, revised the returns were filed on 13.04.2017 and inresponse to the said return, the Department neither passed orderunder Section 143 (3) nor issued a notice under Section 143 (2)of the Act. As in the case on hand, the petitioner/CorrtechInternational (P) Ltd., pleaded extreme financial hardship andrequested that the Authority should refund TDS, which wasdeducted. Since the request was not considered, the WritPetition was filed. The Revenue resisted the prayer for theassessment year 2015-17, by contending that, as the AssessingOfficer has already issued notice under sub-section 2 of Section143, it was not necessary for the Assessing Officer to proceedunder sub-section 1 of Section 143. With respect to theassessment year 2016-17, the Revenue contended that the revisedreturns were filed only on 13.04.2017, and the Assessing Officerhad sufficient time to process the returns under Section 143 (1) of the Act. Therefore, before such time, the assessee cannotclaim refund on the basis of the return filed. 20. The Gujarat High Court, after comparing newlyinserted Section 143 (1 D), as amended by the Finance Act, 2017,drew a comparison between the provisions, which stood prior tothe amendment and after the amendement, and relying on thedecisions in Tata Teleservices Ltd.'s case (supra) and Group M.Media India (P) Ltd. (supra) issued a direction to the AssessingOfficer to complete the process of the assessee's return undersub-section 1 of Section 143 of the Act, within the time frame,and if any refund arises, directed to grant the same. Sofar asthe assessment year 2016-17 is concerned, no direction wasissued, curtailing the statutory time limit. At this juncture,it would be relevant to quote certain paras of the said judgment(viz., in Corrtech International (P) Ltd. (supra), which is asfollows:- " 17.This position would becomeclear if we compare the provisions ofsection 143 (1D) as amended by the FinanceAct, 2017 read with newly inserted Section241 A. Under the new sub-section (1D) thelegislature provides that, notwithstandinganything contained in sub-section (1) theprocessing of the return would not benecessary where a notice has been issued toan assessee under sub-section (2). Thiswould make it clear that, once notice undersection 143(2) has been issued, theAssessing Officer shall not process thereturn under section 143 (1). The originalproviso to sub-section (1D) has beensubstituted by a new proviso under which, itis clarified that the proviso under saidsub-section shall not apply to any returnfurnished for the assessment year commendingon or after 01.04.2017. Section 241 A whichwas inserted simultaneously, now enables theAssessing Officer to withhold the refund infavour of the assessee, which becomes due interms of sub-section (1) of section 143, ifhe is of the opinion that, having regard tothe fact that a notice has been issued undersub-section (2) of section 143 that thegrant of refund is likely to adverselyaffect the Revenue, he would, however, do soby recording reasons in writing and withpreviousapprovalofthePrincipalCommissioner or Commissioner and withhold such refund is till the date the assessmentis made. We may recall that section243,which was omitted w.e.f. 01.06.2001,previously enabled the Assessing Officer towithhold the refund, which becomes due andpayable in terms of sub-section (1) ofsection 143 under certain circumstances,including in a situation where a notice hasbeen issued or is likely to be issued undersub-section (2) of section 143 of the Actand the Assessing Officer is of the opinionthat the grant of refund is likely toadversely affect the Revenue. 21. Coming back to the facts of hand,sofar as the assessment of the year 2-15 -16is concerned, the return was filed on29.09.2015 for which, the time limit underthe normal provision of sub-section (1) ofsection 143 of the Act for processing thereturn is over long back. Eventhough asdiscussed earlier, the Assessing Officerhaving issued notice under sub-section (2)of section 143 of the Act, he would get anextended time for proceeding under sub-section(1) as highlighted by the Delhi HighCourt, in case of Tata Teleservices Ltd.(supra) and by the Bombay High Court in caseof Group M Media India (P) Ltd. (supra) itwould be wholly inequitable for theAssessing Officer to merely sit over thepetitioner's request for refund citing theavailability of time upto the last date offraming the assessment under sub-section (3)of section 143. At least, once the timeupto the last date of framing the assessmentunder sub-section (1) of Section 143 is overwithout the Assessing Officer processing thereturn under the Assessing Officer, by allreasonable interpretation of the statutoryprovisions would be expected to respond tothe assessee's request for either grantingrefund or indicating that, in terms ofadjustments impermissible under sub-section(1) of section 143, such refund or partthereof was not available to the assessee.We simply cannot accept the interpretationof the counsel for the Revenue out of thereturn filed by the assessee would beautomatic and till the passing of the orderof assessment under sub-section (3) of section 143. The reasonable interpretationof the statute and the situation in such acase would be, to expect the AssessingOfficer to take up an expeditious disposalof the processing of return under sub-section (1) of section 143 of the Actatleast once the assessee requests forrelease of the refund, and send as anintimation to the assessee if he wished towithhold the same. section 143. The reasonable interpretationof the statute and the situation in such acase would be, to expect the AssessingOfficer to take up an expeditious disposalof the processing of return under sub-section (1) of section 143 of the Actatleast once the assessee requests forrelease of the refund, and send as anintimation to the assessee if he wished towithhold the same. 22.Under these circumstances, therespondent- Assessing Officer is directed tocomplete the process of the assessee'sreturn under sub-section (1) of section 143of the Act latest by 31.10.2017. If anyrefund arises out of said exercise, grantthe same to the petitioner as per thestatutory provisions. Insofar as theassessment of the year 2016-17 is concerned,the time for processing the return undersub-section (1) of section 143 read withproviso is not yet over. We do not proposeto issue any direction in this respect forcurtailing the statutory time limitenvisaged therein. " 21.The factual difference, in the instant case is that,for the assessment year 2015-16, the case was selected forscrutiny and notice under Section 143 (2) of the Act was issuedon 04.07.2016. Apart from that, the time limit of one year fromthe end of the financial year is over, and the question ofissuing an intimation under Section 143 (1) does not arise, asthere is a statutory prohibition under second proviso toSection 143 (1). This is so, because, the return of income wasfiled by the assessee on 28.11.2015, and the period of one yearexpiredon31.03.2017.Apartfromthat,theApplication/representation, dated 13.07.2017, given by thepetitioner for grant of refund was received by the respondent on20.07.2017, after issuance of notice under Section 143 (2) ofthe Act. However, that does not mean the return needs to beendlessly kept pending. In fact, this aspect was alsoconsidered in Group M. Media India (P) Ltd. (supra), wherein,the Court observed that, CBDT has issued notification, videInstruction No.7 of 2002, dated 01.08.2002, wherein, theyspecifically directed the Assessing Officer of the Revenue toprocess all returns, in which, refunds are payableexpeditiously. Reference was also made to the Citizen'sCharter issued by the Income Tax Department, in its visionstatement, published in 2014, that the Department aspires to issue refund along with interest under Section 143 (1) of theAct within six months from the date of electronically filing thereturns. 22.In the light of the above, both the Writ Petitions aredisposed of with the following directions:- i)The respondent is directed to consider thepetitioner's Application/representation, dated 13.07.2017,(which was received by the respondent on 20.07.2017) for theassessment year 2016-17, and process the return filed for thesaid assessment year under Section 143 (1) of the Act and passappropriate orders within a period of six weeks from the date ofreceipt of a copy of this order. ii)So far as the scrutiny assessment for the year 2015-16is concerned, the petitioner is directed to extend fullcooperation in the assessment proceedings and the AssessingOfficer is directed to complete the scrutiny assessment asexpeditiously as possible. iii) However, there shall be no order as to costs.Consequently, connected Writ Miscellaneous Petitions are closed.Sd/- Assistant Registrar(CCC) //True Copy// sdTo Sub Assistant Registrar The Deputy Commissioner of Income Tax,Large Tax Payer Unit-1,7th Floor, Wanaparthy Block,121, Mahatma Gandhi Road, Chennai - 600 006 RR(CO)TR(13/12/2017) Pre-delivery ordersin W.P.Nos.22665& W.P.No.22666 of 2017