Wpmb/18/2023 Of M/S Gee Cee Metals Private Limited v. Principal Commissioner Income Tax Bareilly

IN THE HIGH COURT OF UTTARAKHANDAT NAINITAL HON’BLE THE CHIEF JUSTICE SRI VIPIN SANGHI AND HON’BLE SRI JUSTICE ALOK KUMAR VERMA 05TH APRIL, 2023 WRIT PETITION (M/B) No. 18 OF 2023 Between: M/s GEE CEE Metals Private Limited (AOP). …Petitioner and Principal Commissioner, Income Tax and others. …Respondents JUDGMENT: (per Sri Vipin Sanghi, C.J.) The petitioner has preferred the present Writ Petition to seek the following reliefs :- “a. Issue a writ, order or direction, in the nature of mandamus directing the Respondents to allow the credit of the Tax Deducted at Source ('TDS') amounting to Rs. 14,61,201/- pertaining to the A.Y. 2008-09 to the Petitioner deducted by the Executive Engineer, Rural Electrification Division, Raniket under the incorrect PAN which is now being reflected under the correct PAN of the Petitioner after the revision of the TDS Statement done by the Executive Engineer, Rural Electrification Division, Haldwani (Ranikhet Division got merged with Haldwani Division); mandamus directing the Respondents to allow the credit of the Tax Deducted at Source ('TDS') amounting to Rs. 14,61,201/- pertaining to the A.Y. 2008-09 to the Petitioner deducted by the Executive Engineer, Rural Electrification Division, Raniket under the incorrect PAN which is now being reflected under the correct PAN of the Petitioner after the revision of the TDS Statement done by the Executive Engineer, Rural Electrification Division, Haldwani (Ranikhet Division got merged with Haldwani Division); b. Issue a writ, order or direction, in the nature of certiorari quashing the impugned Order dated 18/02/2022 (ANNEXURE NO. -2) issued by the Respondent No-1 under section 119(2)(b) of the Income Tax Act, 1961; certiorari quashing the impugned Order dated 18/02/2022 (ANNEXURE NO. -2) issued by the Respondent No-1 under section 119(2)(b) of the Income Tax Act, 1961; c. Issue a writ, order or direction, in the nature of mandamus directing the Respondents to allow the Petitioner to rectify its Income Tax return qua the TDS amounting to Rs. 14,61,201/- now being reflected under the correct PAN of the Petitioner after the revision of the TDS Statement done by the Executive Engineer, Rural Electrification Division, Haldwani (Ranikhet Division got merged with Haldwani Division) ; mandamus directing the Respondents to allow the Petitioner to rectify its Income Tax return qua the TDS amounting to Rs. 14,61,201/- now being reflected under the correct PAN of the Petitioner after the revision of the TDS Statement done by the Executive Engineer, Rural Electrification Division, Haldwani (Ranikhet Division got merged with Haldwani Division) ; d. Issue a writ, order or direction, in the nature of certiorari quashing or reading down the time limit of six years as mentioned in the clause No. 3 of the Circular No. 09/2015 dated 09.06.2015 (ANNEXURE NO. 1); certiorari quashing or reading down the time limit of six years as mentioned in the clause No. 3 of the Circular No. 09/2015 dated 09.06.2015 (ANNEXURE NO. 1); e. Issue a writ, order or direction, in the nature of certiorari quashing the Grievance filed on 11/08/2020 and closed on 21/02/2021 (ANNEXURE NO. 6) certiorari quashing the Grievance filed on 11/08/2020 and closed on 21/02/2021 (ANNEXURE NO. 6) f. Issue any other writ, order or direction and /or allow any other consequential relief as expedient in law, on the facts and circumstances of the case.” allow any other consequential relief as expedient in law, on the facts and circumstances of the case.” 2. The case of the petitioner is that the petitioner e. Issue a writ, order or direction, in the nature of certiorari quashing the Grievance filed on 11/08/2020 and closed on 21/02/2021 (ANNEXURE NO. 6) certiorari quashing the Grievance filed on 11/08/2020 and closed on 21/02/2021 (ANNEXURE NO. 6) f. Issue any other writ, order or direction and /or allow any other consequential relief as expedient in law, on the facts and circumstances of the case.” allow any other consequential relief as expedient in law, on the facts and circumstances of the case.” 2. The case of the petitioner is that the petitioner is an Association of Persons (AOP). The petitioner had applied for, and obtained the PAN Number in respect of the said Association of Persons. Petitioner states that the petitioner was issued PAN No. . The said PAN Number related to a company, and not to an Association of Persons. Petitioner states that due to the said error in issuance of the PAN Card, TDS of the amount of Rs. 14,61,201/-, deducted by the Uttarakhand Power Corporation Limited, Ranikhet - for whom the petitioner performed a contract, was not reflected in Form 26AS in the new PAN No. , which the petitioner obtained as an Association of Persons. 3. Petitioner further states that the petitioner requested for cancellation of the old PAN Number on 19.06.2008, since the petitioner had obtained a new PAN Number as an Association of Persons. It appears that, thereafter, there was a complete lull on the part of the petitioner, and the petitioner woke up only in the year 2020, and sought to take action for reflection of the TDS deducted, amounting to Rs. 14,61,201/-, against the new PAN Number obtained by the petitioner in the year 2008 itself. Petitioner states that the Income Tax Authorities have also reflected the aforesaid TDS amount against the new PAN Number of the petitioner, as an Association of Persons. The petitioner, then, applied for rectification of the Assessment Order under Section 143A of the Income Tax Act. However, the said application has not been entertained on the ground that the application for rectification had been filed beyond the period of limitation, and even beyond the period for which the application for condonation of delay could be entertained, which was six years from the end of the Assessment Year, for which the application/ claim is made. The order dated 18.02.2022, passed by respondent no. 1, reads as follows :- “ORDER U/S 119(2)(b) OF THE I.T. ACT, 1961 The assessee has submitted application on 09.07.2021 for granting permission u/s 119(2)(b) of the Income Tax Act, 1961 for A.Y 2008-09 and claiming refund. In this regard, it is to state that as per Circular 9/2015 (F.No.312/22/2015-OT) dated 09.06.2015 of the Hon'ble CBDT, New delhi stated in SL. No. 3 that “No condonation application for calm of refund/loss shall be entertained beyond six years from the end of the assessment year for which such application/claim is made.” The application of the assessee is not covered by the aforesaid CBDT's circular, being beyond six years from the end of the assessment year for which application has been filed.” 4. Since the petitioner was not covered by the aforesaid Circular No. 9/2015 dated 09.06.2015, and that came as a stumbling block in the petitioner seeking condonation of delay beyond the period of six years from the end of the Assessment Year pertaining to which the application/ claim was made, the petitioner has assailed the said Circular as well, in this Writ Petition. The relevant clause of Circular No. 9/2015, which the petitioner assails, reads as follows :- 4. Since the petitioner was not covered by the aforesaid Circular No. 9/2015 dated 09.06.2015, and that came as a stumbling block in the petitioner seeking condonation of delay beyond the period of six years from the end of the Assessment Year pertaining to which the application/ claim was made, the petitioner has assailed the said Circular as well, in this Writ Petition. The relevant clause of Circular No. 9/2015, which the petitioner assails, reads as follows :- “3.No condonation application for claim of refund/loss shall be entertained beyond six years from the end of the assessment year for which such application/claim is made. This limit of six years shall be applicable to all authorities having powers to condone the delay as per the above prescribed monetary limits, including the Board. A condonation application should be disposed of within six months from the end of the month in which the application is refund/loss shall be entertained beyond six years from the end of the assessment year for which such application/claim is made. This limit of six years shall be applicable to all authorities having powers to condone the delay as per the above prescribed monetary limits, including the Board. A condonation application should be disposed of within six months from the end of the month in which the application is received by the competent authority, as far as possible.” 5. The submission of learned counsel for the petitioner is that the said Circular No. 9/2015 has been issued by the Central Board of Direct Taxes in exercise of its powers vested under Section 119(2)(b) of the Income Tax Act. Sub-section (1) of Section 119 of the Income Tax Act authorizes the Board to issue such orders, instructions and directions to other income-tax authorities, as it may deem fit for the proper administration of the Act, and the income-tax authorities are bound to follow the said orders, instructions and directions. Sub-section (2) of Section 119, insofar as, it is relevant, reads as follows :- “(2) Without prejudice to the generality of the foregoing power,– foregoing power,– (a) ………… (b) the Board may, if it considers it desirable or expedient so to do for avoiding genuine hardship in any case or class of cases, by general or special order, authorize any income-tax authority, not being a Commissioner (Appeals) to admit an application or claim for any exemption, deduction, refund or any other relief under this Act after the expiry of the period specified by or under this Act for making such application or claim and deal with the same on merits in accordance with law;” or expedient so to do for avoiding genuine hardship in any case or class of cases, by general or special order, authorize any income-tax authority, not being a Commissioner (Appeals) to admit an application or claim for any exemption, deduction, refund or any other relief under this Act after the expiry of the period specified by or under this Act for making such application or claim and deal with the same on merits in accordance with law;” 6. Learned counsel for the petitioner submits that Section 119(2)(b) of the Income Tax Act authorizes the Board to issue orders to the Income Tax Authorities to entertain remedies available under the Act, by way of application or claim for any exemption, deduction, refund, or any other relief beyond the period of limitation. However, the same does not permit the Board to lay down an outer-limit of time, during which such application for condonation of delay may be entertained. Learned counsel submits that, by prescribing the outer-limit of six years, under Clause 3 of the Circular No. 9/2015, the Board has exceeded its statutory power. Learned counsel further submits that the petitioner would be put to grave hardship, since the said amount of Rs. 14,61,201/-, which constitutes the working capital of the petitioner, would remain locked up, and will not be available to the petitioner to claim credit, for no fault of the petitioner. 7. We have considered the aforesaid submissions of learned counsel for the petitioner, and do not find any merit in the same. 8. When Section 119(2)(b) of the Income Tax Act authorizes the Board to issue instructions, directions or orders to the Income Tax Authorities to admit an application, or claim for any exemption, deduction, refund, or any other relief under the Act after the expiry of the period of limitation specified by or under the Act, along with the said power goes the power to prescribe the conditions, upon which such delayed applications may be entertained. Since the petitioner sought condonation of delay by resort of the very same Circular No. 9/2015, the petitioner has to accept the conditions prescribed in the said circular for entertainment of application seeking condonation of delay. Therefore, it is not correct for the petitioner to contend that the Board has no power to lay down an outer-limit of limitation, during which period an application for condonation of delay may be entertained. 9. The rectification application could be filed by the petitioner within four years of the expiry of the Assessment Year. Admittedly, the petitioner did not do so. By resorting to Clause 3 of Circular No. 9/2015, the petitioner could have sought condonation of delay, in moving the rectification application by another two years. The petitioner did not file the rectification application either within the period of limitation, or even within the period for which the delay could be condoned, i.e. up to six years. The petitioner moved the rectification application only in the year 2021, i.e. after over 12 years. 10. It is well settled that, with the expiry of limitation, the law bars the remedy even if the right is not extinguished. Therefore, the right of the petitioner, to avail of the remedy of rectification, stood barred by the law of limitation. The petitioner has only itself to blame for not availing of the remedy available to it within the period of limitation, or even within the period during which the application for condonation of delay could be entertained. 11. For the aforesaid reasons, we find no merit in this Writ Petition. The same is, accordingly, dismissed. 12. Consequently, pending applications, if any, also stand disposed of. ________________ VIPIN SANGHI, C.J. Dt: 05[th] April, 2023 Rahul ___________________ ALOK KUMAR VERMA, J.