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IN THE HIGH COURT OF KARNATAKA AT BENGALURU
M.NAGAPRASANNA
Asianxt Digital Technologies Pvt. Ltd. – Appellant
Versus
Assistant Commissioner Of Income Tax – Respondent
| Table of Content |
|---|
| 1. seeking refund and interest under income tax law. (Para 2) |
| 2. petitioner's reliance on prior case law. (Para 3 , 4) |
| 3. adjustments of refunds without proper legal process. (Para 5) |
ORAL ORDER :
The petitioner is before this Court, seeking the following prayer:
"A. Issue as far as Petitioner is concerned by an appropriate writ or Order in the nature of Mandamus or otherwise, to the Learned First Respondent to grant refund of amount set-off in excess of 20% of demand as per letter dated 30.05.2025 enclosed as Annexure G.
B. Issue as far as Petitioner is concerned by an appropriate writ or Order in the nature of Mandamus or otherwise, directing the learned Respondent to grant interest on refund as stipulated under section 244A for AY 2020-21.
AND
C. Grant such other reliefs as this Honourable High Court may think fit including the cost of this writ petition"
2. Heard Sri. Narendra Kumar J. Jain, learned counsel appearing for the petitioner, Sri. M. Dilip, learned counsel appearing for the respondents and have perused the material on record.
3. Learned counsel appearing for the petitioner submits that the petitioner is similarly placed with that of the petitioner in W.P.No.120
Exceeding 20% adjustments of income tax refunds are impermissible, and full refunds must be made within stipulated time frames as per legal precedents.
Point of Law : Taxation - Lieu of payment of refund tax - Government is bound to follow rules and standards they themselves had set on pain of their action being invalidated.
Tax authorities must adhere to established guidelines for refund adjustments, and deviations require explicit justification.
Refunds cannot be adjusted against demands exceeding 20% of the disputed amount, ensuring compliance with pre-deposit norms under taxation laws.
The main legal point established in the judgment is that the adjustment made by the Assessing Officer must comply with the stipulated percentage of the disputed demand as per the relevant provisions ....
Adjustment of tax refunds against outstanding dues requires prior intimation and adherence to principles of natural justice as mandated by Section 245 of the Income Tax Act.
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