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IN THE HIGH COURT OF DELHI AT NEW DELHI
Rajiv Shakdher, Tara Vitasta Ganju, JJ.
Progressive Infotech Private Limited – Appellant
Versus
Union of India & Ors. – Respondents
W.P.(C) 10618 of 2023
Decided On : 11-08-2023
Refund - Income Tax - The court directed the revenue to remit the determined refund amounts to the petitioner within a specified timeline and to pay any applicable interest that has accrued, highlighting the obligation of the revenue to promptly refund overpaid taxes and accrued interest to taxpayers.
Fact of the Case:
The petitioner claimed refunds for Assessment Years 2020-21 and 2021-22, which had not been remitted despite determinations made by the revenue. The petitioner's counsel asserted that the determined refund amounts had not been received.
Finding of the Court:
The court directed the revenue to remit the determined refund amounts to the petitioner within two weeks and to pay any applicable interest that had accrued. It also instructed the revenue to inquire into the delay in remitting the refunds and to ensure compliance with the directive.
Issues: Non-remittance of determined refund amounts to the petitioner despite the revenue's determinations, and the obligation of the revenue to promptly refund overpaid taxes and accrued interest to taxpayers.
Ratio Decidendi: The court emphasized the obligation of the revenue to promptly remit determined refund amounts to taxpayers and to pay any applicable interest that has accrued, highlighting the importance of timely refund of overpaid taxes.
Final Decision: The court closed the writ petition and listed the matter for compliance, directing the revenue to remit the determined refund amounts to the petitioner within two weeks and to pay any applicable interest that has accrued.
JUDGMENT
[Physical Hearing/Hybrid Hearing (as per request)]
Rajiv Shakdher, J. (Oral)
CM Appl.41211/2023
1. Allowed, subject to just exceptions.
W.P.(C) 10618/2023
2. The principal grievance of the petitioner is that the refund for Assessment Years (AYs) 2020-21 and 2021-22 has not been remitted.
2.1. According to the petitioner, for AY 2020-21, it is entitled to a refund of Rs.3,38,87,284/-. Likewise, for AY 2021-22, the petitioner claims refund of Rs.2,22,95,140/-.
3. Mr Aseem Chawla, learned senior standing counsel, who appears on behalf of the respondents/revenue, says that he has obtained instructions in the matter.
3.1. According to Mr Chawla, a rectification order under Section 154 of the Income Tax Act, 1961 [in short, "Act"] was passed on 08.02.2023, concerning AY 2020-21, whereby the refund amount of Rs.3,24,74,436/- has been determined.
3.2. Likewise, insofar as AY 2021-22 is concerned, refund amounting to Rs.2,22,95,137/- has been determined in favour of the petitioner, under Section 143(3) of the Act, via order dated 27.12.2022.
4. A copy of the communication, along with the computation sheet, has been furnished to the counsel for the petitioner in court today.
5. Counsel for the petitioner, however, says that the aforementioned refund amount, as determined, has not been received by the petitioner.
6. If this position is correct, certainly CBDT needs to inquire, as the determination qua AY 2021-22 was made as far back as on 27.12.2022, whereas the determination with regard to the refund qua AY 2020-21 was made on 08.02.2023, as the interest that has accrued in the meanwhile is a drain on the public exchequer.
7. The respondents/revenue will ensure that the refund amount is remitted to the petitioner within two (2) weeks of the receipt of a copy of the judgment.
8. Furthermore, Mr Chawla will place a copy of the order passed today by us before the Chairperson, CBDT. The Chairperson, CBDT is requested to look into the matter as to why the determined refund is not being remitted to the petitioner.
9. Needless to add, in view of the above, in case any applicable interest has accrued, the same shall also be paid to the petitioner within the same timeline.
10. The writ petition is closed.
11. List the matter for compliance on 06.10.2023.
12. The Registry is directed to scan and upload the hardcopy of the email dated 08.08.2023 and the accompanying documents placed before us, so that the same remains embedded in case file.
13. Parties will act based on the digitally signed copies of the order.
Prompt addressing of rectification application for refund and timely remittance of refund amount if due.
The central legal point established in the judgment is the importance of expeditious disposal of appeals and compliance with court directions in matters related to refunds and recovery proceedings.
The court has the authority to direct the revenue to remit disputed refund amounts and grant liberty to file a rectification application for differences in refund amounts under the Income Tax Act, 19....
The obligation of the Assessing Officer to pass a speaking order in response to the petitioner's communication regarding the reconciliation of refund figures.
The court mandated the Central Board of Direct Taxes to designate an officer responsible for processing the petitioner's refund request under Section 244A of the Income Tax Act.
Interest on refunds is warranted from the date of valid application in cases where the authority does not contest the claim, reinforcing the principle of compensation for delayed access to owed funds....
The court held that the best course is to remit matters to the Assessing Officer for a speaking order rather than filing for rectification when significant time has passed.
The court emphasized the importance of following the regime set forth in Section 245 of the Income Tax Act, 1961, and upheld the petitioner's right to seek an appropriate remedy if aggrieved by the d....
Tax refunds must comply with legal protocols, and any readjustment without notice lacks justification under tax law.
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