FOSROC CHEMICALS INDIA PVT LTD V. COMMISSIONER OF INCOME TAX (APPEALS) 14

WP/18796/2021

AI Insights

Fosroc Chemicals India Pvt Ltd filed a writ petition against various income tax authorities seeking a refund of Rs.4,51,40,507, which was demanded in excess of 15% of the demand raised for the assessment year 2009-10. The petitioner also sought expedited disposal of an appeal pending before the Commissioner of Income Tax (Appeals) and requested a stay on the enforcement of the balance demand until the appeal's disposal. The court noted that similar issues had been previously decided in favor of the petitioner for other assessment years and acknowledged the delay in the appellate process due to the faceless appeal scheme. The court provided a framework for the refund process if the appeal is not resolved within the specified timeframe.

• Counselvise Citation: [2022] 140 COUNSELVISE.COM (IT) 695638 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 10-03-2022
• Assessment Year: misc
• Laws Referred To: Articles 226 and 227 of the Constitution of India
• Result in Favour of: Partly Allowed
• Court: HIGH COURT
• Department Lawyers: K V ARAVIND
• Assessee Lawyers: T SURYANARAYANA; TANMAYEE RAJKUMAR
• Keywords: Assessment Year 2009-10; Excess Demand; Faceless Appeal; Income Tax; Refund
• Section: 15

Judgement Text

"IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 10TH DAY OF MARCH 2022 BEFORE THE HON’BLE MR. JUSTICE B. M. SHYAM PRASAD WRIT PETITION NO. 18796/2021 (T/IT) BETWEEN : FOSROC CHEMICALS INDIA PVT LTD NO. 150, 2ND FLOOR, EMBASSY POINT, INFANTRY ROAD, BANGALORE – 560 001. REP HEREIN BY ITS DIRECTOR, MR. MOHESH KUMAR AGARWAL. ... PETITIONER (BY SRI. T. SURYANARAYANA, SENIOR ADVOCATE FOR SMT. TANMAYEE RAJKUMAR., ADVOCATE) AND : 1. COMMISSIONER OF INCOME TAX (APPEALS) 14 7TH FLOOR, BMTC BUILDING, 80 FEET ROAD, KORAMANAGALA, BANGALORE – 560 095. 2. NATIONAL FACELESS APPEALS CENTRE DELHI. 3. ASSISTANT / DEPUTY COMMISSIONER OF INCOME TAX (LARGE TAX PAYER UNIT), CIRCLE -1, BANGALORE , 80 FEET ROAD, BMTC BUILDING, KORAMANGALA, BANGALORE – 560 095. 2 4. THE CHIEF COMMISSIONER OF INCOME TAX LTU, BANGALORE , 80 FEET ROAD, BMTC BUILDING, KORAMANGALA, BANGALORE – 560 095. ... RESPONDENTS (BY SRI. K.V. ARAVIND, ADVOCATE) THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO DIRECT THE R3 TO FORTHWITH REFUND RS.4,51,40,507/- BEING DEMAND RECOVERED IN EXCESS OF 15 PERCENT OF THE DEMAND RAISED FOR THE ASSESSMENT YEAR 2009-10, ALONG WITH APPLICABLE INTEREST; DIRECT THE R1 TO DISPOSE OF THE APPEAL PENDING BEFORE HIM FOR THE ASSESSMENT YEAR 2009-10 IN ITA VIDE ANNEXURE-L DATED 28.12.2016 IN AN EXPEDITE MANNER; DIRECT THE RESPONDENTS NOT TO ENFORCE THE BALANCE DEMAND RAISED VIDE NOTICE DATED 17.11.2016 ANNEXURE-K UNTIL DISPOSAL OF THE APPEAL BY THE R1 AND FOR A PERIOD OF THREE WEEKS THEREAFTER. THIS WRIT PETITION COMING ON FOR ORDERS, THIS DAY, THE COURT MADE THE FOLLOWING: O R D E R The petitioner has sought for the following reliefs: “i) Directing the 3rd Respondent to forthwith refund Rs.4,51,40,507/- being demand recovered in excess of 15% of the demand raised for the assessment year 2009-10, along with applicable interest; 3 (ii) Directing the 1st Respondent to dispose of the appeal pending before him for the assessment year 2009-10 in ITA No.150/ACIT, LTU, C-1/CIT(A)- 14/16-17 – Annexure-L dated 28.12.2016 in an expedite manner; (iii) Direct the Respondents not to enforce the balance demand raised vide notice dated 17.11.2016 (annexure-K) until disposal of the appeal by the 1st respondent and for a period of three weeks thereafter.” 2. Sri T. Suryanarayana, learned Senior Counsel for the petitioner, submits that it would be indisputable that on an identical issue, the petitioner has succeeded for the assessment years 2007-08 and also for the assessment years subsequent to the assessment year 2009-10. There is a binding decision on this identical issue by this Court. In the instant case, the entire demand for the assessment year 2009- 10 is paid, and the petitioner’s appeal, which is filed in 4 the year 2016, is pending consideration. The authorities cannot justifiably withhold the entire amount recovered, especially in the light of the fact that in normal circumstances, an aggrieved assessee could impugn the demand subject to depositing 20%. Therefore, this Court must allow the writ petition and direct the authorities to refund atleast 85% of the amount recovered by its demand. 3. Sri K.V.Aravind, learned counsel for the respondents, submits that the delay in disposing of the appeal could only be because of the introduction of faceless appeal scheme. In fact, because of the submission in similar lines on the previous hearing dates, Sri K.V.Aravind was called upon to secure instructions on the timeframe within which the petitioner’s appeal could be disposed of. Sri.K.V.Aravind submits, given all the circumstances, 5 the appeal could be disposed of within an outer limit of six months. 4. As regards the petitioner’s request for refund of the demand recovered, Sri. K.V. Aravind submits that in terms of the revised norms the petition could be disposed of with liberty to the petitioner to file an application with the Assessing Officer for refund of 80% within a reasonable timeframe and this Court may also call upon the Assessing Officer to consider such request within a definite time frame. 5. For disposal of the writ petition, the rival submissions must be considered in the light of the undisputed fact that the petitioner has the benefit of this Court’s conclusion on identical issue for some of the assessment years and an aggrieved assessee can pursue appellate remedy against the demand subject to 6 deposit of 20% of the demand; and also that the petitioner’s appeal is pending for almost five years. 6. In consideration of these circumstances, this Court is of the considered view that the petition must be disposed of with liberty to the petitioner, in the event the petitioner’s relevant appeal is not disposed of, for whatever reason, within four months from 1.4.2022, to submit an application with the Assessing Officer for refund of 80% of the demand deposited. If the petitioner submits appropriate application with all necessary details, the Assessing Officer shall refund 80% of the demand deposited within three weeks from the date of such application. Sd/- JUDGE SA/- Ct:sr "