Ram Niwas v. Chief Commissioner Of Income Tax, Panchkula And Others

CWP No. 22759 of 2015 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH CWP No. 22759 of 2015 Date of Decision: 2.11.2015 Ram Niwas ....Petitioner. Versus Chief Commissioner of Income Tax, Panchkula and others ...Respondents. 1.Whether the Reporters of the local papers may be allowed to see the judgment?the judgment? 2.To be referred to the Reporters or not? 3.Whether the judgment should be reported in the Digest? CORAM:-HON'BLE MR. JUSTICE AJAY KUMAR MITTAL.HON'BLE MR. JUSTICE RAMENDRA JAIN. PRESENT: Mr. Sudhanshu Makkar, Advocate for the petitioner. AJAY KUMAR MITTAL, J. 1.In this writ petition filed under Articles 226/227 of theConstitution of India, the petitioner has prayed for issuance of a writ inthe nature of certiorari for setting aside and modifying the impugnedorder dated 9.10.2014 (Annexure P-15) passed by respondent No.1 videwhich the application of the petitioner to waive the interest chargedunder Sections 234A and 234B of the Income Tax Act, 1961 (in short“the Act”) for the assessment years 1988-89 to 1996-97 has been partlydeclined by respondent No.1 in exercise of its powers under Section 119(2)(a) of the Act. 2.A few facts relevant for adjudication of the instant petition asnarrated therein may be noticed. Smt. Sunder Bai, the predecessor-in-interest of the petitioner, was an assessee of the Income Tax Department and she had expired on 7.9.2008. She is being representedby her legal heir-Ram Niwas, the petitioner herein. The assessee wasowner in possession of the land measuring 29 kanal 9 marlas, situatedwithin the revenue estate of village Bhiwani Lohar, Tehsil and DistrictBhiwani. Government of Haryana vide notification dated 4.6.1986issued under Section 4 of the Land Acquisition Act, 1894 (hereinafterreferred to as “the 1894 Act”) followed by notification dated 15.4.1987under Section 6 thereof acquired the land of the assessee for thedevelopment and utilization of land as residential and commercial area.The award was passed on 10.11.1987 awarding compensationamounting to ` 57,500/- per acre (i.e. ` 11.81 per square yard) of theland acquired pertaining to nehri category. The assessee accepted thepayment of compensation amount of ` 2,99,112.20 under protest. Beingdissatisfied with the award, the assessee filed a reference under Section18 of the 1894 Act. The said reference was decided by the DistrictJudge, Bhiwani vide award dated 14.10.1993 (Annexure P-1) whoenhanced the amount of compensation to ` 125 per square yard.Besides this, the landowners were held entitled to recover 30% solatiumon the amount increased along with interest at the rate of 9% per annumfor the 1[st] year from the date of taking possession of the land and at therate of 15% per annum for the subsequent period till the date ofpayment. Thereafter, award dated 14.10.1993 (Annexure P-1) waschallenged by the assessee before this Court by way of RFA No. 777 of1994. State of Haryana also challenged the said award by filing RFA No.1140 of 1994. This Court decided a bunch of appeals vide RFA No. 947of 1994 including the appeals in question and vide orders dated18.2.1999 (Annexures P-3 to P-5, respectively) reduced the enhanced rate of ` 125/- to ` 79.98 per square yard. Some of the landownerschallenged the order, Annexure P-5, passed by this Court before theSupreme Court and the Apex Court vide order dated 12.11.2002(Annexure P-6) passed in Civil Appeal No. 7139 of 2001 upheld theorder of this Court. The Land Acquisition Collector issued Form 16-A on22.5.2001 (Annexure P-7) after deducting TDS amounting to ` 74,981/-and ` 2,24,943/- on 3.12.1995 and 29.2.1996, respectively. Thereafter,the Assessing Officer issued notices dated 22.5.2001 and 19.3.2002(Annexure P-8 Colly) under Section 148 of the Act for the assessmentyears 1988-89 to 1996-97 to the assessee for filing the returns. Inpursuance thereto, the assessee filed returns on 29.1.2001 for theassessment years 1991-92 to 1995-96 and on 29.5.2002 for theassessment years 1988-89, 1989-90 and 1996-97. After the decision ofthe Apex Court in Civil Appeal No. 7139 of 2001 on 12.11.2002, theassessee filed revised returns on 23.1.2003 for all these assessmentyears by reducing the income by 20% approximately. For theassessment year 1990-91, the original return was filed on 23.1.2003.The Assessing Officer vide assessment orders dated 23.1.2003(Annexure P-9 Colly) calculated the total amount of interest on enhancedcompensation at ` 26,77,877/- for the assessment years in question andafter reducing 20%, it was determined at ` 21,81,710/-. Accordingly, thedemand notices and challans were issued to the assessee by allowingproportionate adjustment of the TDS amount of ` 2,99,924/- depositedby the Land Acquisition Collector. Interest was also ordered to becharged under Sections 234A and 234B of the Act. The assessee couldnot pay the advance tax during the accounting period relevant to eachassessment year under consideration due the decision of the Apex Court which came later on and even the returns were filed after due date offiling of the returns. The assessee filed applications dated 7.1.2004(Annexure P-12 Colly) before respondent No.1 for waiver of interest interms of CBDT notifications dated 2.5.1994 (Annexure P-10) and dated23.5.1996 (Annexure P-11). When no action was taken, the assesseesent reminders dated 6.1.2006 (Annexure P-13) and dated 24.10.2009(Annexure P-14). Respondent No.1 vide order dated 9.10.2014(Annexure P-15) waived off the interest charged under Section 234A ofthe Act for the assessment years 1988-89 to 1996-97 till 31.5.2001 andthe interest under Section 234B of the Act has been waived off for theperiod upto 29.2.1996 only. Hence, the present writ petition. 3.After hearing learned counsel for the petitioner, we do notfind any merit in the writ petition. 4.The matter here relates to waiver of interest charged againstthe assessee under Sections 234A and 234B of the Act. 5.Respondent No.1 while waiving of interest under Section234A of the Act noticed that the TDS certificate was issued to theassessee on 29.5.2001 and, therefore, the assessee was prevented byreasonable cause not to furnish the returns within time due on account ofunavoidable circumstances. The assessee was, thus, held entitled towaiver of interest charged under Section 234A of the Act upto 31.5.2001for the assessment years 1988-89 to 1996-97. The relevant portion ofthe order reads thus:- “6.1. As mentioned above, the TDS Certificate wasissued to the assessee on 29.05.2001. Thus, there ismerit in the contention of the assessee that returns ofincome for the assessment years under consideration could not be furnished within time due to unavoidablecircumstances. The returns of income could only befiled after the receipt of TDS Certificate. In the presentcase the returns of income were filed on the datesmentioned in para 5. Thus, the assessee's case forwaiver of interest charged u/s 234A of the I.T. Act upto31.05.2001, i.e. the end of the month during whichT.D.S. Certificate was issued is covered under para 2(e) of the CBDT Notification dated 23 May, 1996. “6.1. As mentioned above, the TDS Certificate wasissued to the assessee on 29.05.2001. Thus, there ismerit in the contention of the assessee that returns ofincome for the assessment years under consideration could not be furnished within time due to unavoidablecircumstances. The returns of income could only befiled after the receipt of TDS Certificate. In the presentcase the returns of income were filed on the datesmentioned in para 5. Thus, the assessee's case forwaiver of interest charged u/s 234A of the I.T. Act upto31.05.2001, i.e. the end of the month during whichT.D.S. Certificate was issued is covered under para 2(e) of the CBDT Notification dated 23 May, 1996. 7.To conclude, for the asstt. years 1988-89 to1996-97 interest charged u/s 234A of the I.T. Act iswaived till 31.05.2001. Interest charged u/s 234B ofthe IT Act is waived for the period up to 29.02.1996. The Assessing Officer is directed allow reliefaccordingly.”accordingly.” 6.Interest charged under Section 234B of the Act was waivedby respondent No.1 as the enhanced compensation and interest thereonwas received by the assessee much after the due date for depositing theadvance tax and for furnishing the returns of income for the assessmentyears 1988-89 to 1996-97. It was recorded that in such circumstances,the assessee could not have anticipated or determined the interestincome that had accrued to him under the orders of the Land AcquisitionCourt prior to disbursement by HUDA on 13.12.1995 and 29.2.1996. Onthat basis, respondent No.1 held the assessee entitled to waiver ofinterest charged under Section 234B of the Act for the assessment years1988-89 to 1995-96 upto 29.2.1996, with the following observations:- “6.The facts of the assessee's case have beenconsidered in the light of the Notifications cited supraand submissions made on behalf of the assessee. Itis assessee much after the due date for depositing theadvance tax and for furnishing the returns of incomefor the assessment years 1988-89 to 1996-97. Theassessee possibly could not have anticipated ordetermined the interest income that accrued to him byvirtue of the order of the District & Sessions Judge,Bhiwani and its determination as well as disbursementby HUDA on 13.12.1995 and 29.02.1996. The returnsof income for the assessment years 1988-89 to 1996-97 were filed by the assessee mentioned in para 4.1.Thus, the relevant income for the assessment years under consideration was disclosed in the returns ofincome filed by the assessee and the tax attributableto such income was also paid. Accordingly, theassessee fulfills the conditions laid down in CBDT'sNotification dated 2.5.1994. However as per para ii(b)of the said Notification the assessee is entitled towaiver of interest charged u/s 234B of the IT Act,1961 from the first day of April of the relevantassessment year till the end of the month in which therelevant order giving rise to the relevant income ispassed. In the present case the last disbursementwas made by HUDA on 29.02.1996. Therefore, theassessee is entitled to waiver of interest charged u/s234B of the IT Act upto 29.02.1996, as under:- CWP No. 22759 of 2015 -8- 7.Learned counsel for the assessee-petitioner could notdemonstrate that there existed any illegality or perversity in the approachof respondent No.1 which may warrant interference by this Court. Thediscretion had been rightly exercised by respondent No.1 and no errorcould be pointed out in the impugned order dated 9.10.2014 (AnnexureP-15). Accordingly, finding no merit in this writ petition, the same ishereby dismissed. (AJAY KUMAR MITTAL)JUDGE November 2, 2015gbs (RAMENDRA JAIN) JUDGE