M/S SUMAN V. THE PRINCIPAL COMMISSIONER OF INCOME TAX-5

WP/5740/2018

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M/s. Suman, represented by its partner Sri. Rajesh Parasmal Lunkad, filed a writ petition against the Principal Commissioner of Income Tax-5, Bengaluru, challenging the rejection of their application for condonation of delay in the payment of the third instalment of tax under the Income Disclosure Scheme, 2016. The petitioner had initially paid the first two instalments on time but failed to pay the third instalment by the due date, claiming an oversight. The Principal Commissioner rejected the condonation application based on the guidelines of the IDS 2016, which did not allow for the extension of the payment deadline. The petitioner cited a Supreme Court decision that, while not extending the deadline, directed the refund or adjustment of amounts already deposited under a similar scheme. The court dismissed the writ petition, agreeing with the Principal Commissioner's decision but acknowledged the possibility of refund or adjustment of the already deposited amounts.

• Counselvise Citation: [2018] 140 COUNSELVISE.COM (IT) 755185 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 20-02-2018
• Assessment Year: misc
• Other Referred Cases: Hemalatha Gargya Vs. Commissioner of Income Tax (2003) 259 ITR 1 (SC)
• Laws Referred To: Income Tax Act, 1961, Constitution of India
• Result in Favour of: Revenue
• Court: HIGH COURT
• Department Lawyers: JEEVAN NEERALGI
• Assessee Lawyers: CHYTHANYA
• Keywords: Condonation of delay; Tax payment; Voluntary Disclosure of Income Scheme, 1997; Income Disclosure Scheme, 2016
• Section: 119(2)(b); 226; 227

Judgement Text

" 1/7 IN THE HIGH COURT OF KARNATAKA AT BENGALURU Dated this the 20th day of February, 2018 Before THE HON’BLE DR JUSTICE VINEET KOTHARI Writ Petition No.5740 of 2018 (T-IT) Between M/s. Suman #912, Kanchan Sadan Nagarathpete Main Road Bengaluru-560002 (Represented by its Partner Sri. Rajesh Parasmal Lunkad Aged about 43 years S/o Sri. Parasmal Lunkad). ... Petitioner (By Mr. Chythanya K.K. Advocate) And The Principal Commissioner of Income Tax-5 Room No.538, 5th Floor 80 Feet Road, Koramangala Bengaluru-560 095. ... Respondent (By Mr. Jeevan J. Neeralgi, AGA) **** This Writ Petition is filed under Articles 226 and 227 of the Constitution of India, praying to quash as far as the petitioner is concerned by an appropriate writ or order in the nature of certiorari or otherwise the impugned Letter F.No.29/IDS 2016/Pr.CIT-5/2017-18 dated 18-12-2017 issued by the Respondent, enclosed in Annexure-A & etc., Date of Order 20-02-2018 W.P.No.5740/2018 M/s. Suman Vs. The Principal Commissioner of Income Tax-5 .. 2/7 This Writ Petition coming on for Preliminary Hearing this day, the Court made the following: O R D E R Mr.Chythanya K.K., Advocate for Petitioner Mr. Jeevan J. Neeralgi, Advocate for Respondent 1. The petitioner M/s. Suman, Bengaluru has filed this writ petition against the order dated 18/12/2017 passed by the Respondent – Principal Commissioner of Income Tax-5, Bengaluru, rejecting the Application of the petitioner assessee under Section 119(2)(b) of the Income Tax Act, 1961, seeking condonation of delay in payment of 3rd Instalment of the tax amount declared by the petitioner assessee under the Income Disclosure Scheme, 2016 (IDS 2016). 2. The learned counsel for the petitioner assessee submitted before the Court that though the first and second instalments were paid within the stipulated time on 21/11/2016 of Rs.22,07,620/- and second instalment on 30/03/2017 of the same amount, the third and final Date of Order 20-02-2018 W.P.No.5740/2018 M/s. Suman Vs. The Principal Commissioner of Income Tax-5 .. 3/7 instalment of 50% remaining amount of Rs.44,15,236/- could not be paid by oversight and inadvertently by the petitioner assessee before the stipulated period on 30/09/2017, the last date promulgated by the Central Government for the said purpose of IDS Scheme 2016 and therefore the delay condonation application was filed before the Principal Commissioner of Income Tax and it has been rejected by the said Authority. 3. The operative portion of the said impugned order dated 18/12/2017 is quoted below for ready reference: “4.0. In your petition for condonation of delay in payment of tax in the last instalment, you have stated that the payment was not made on or before 30th September on account of impression in your mind that the last date for payment of such instalment was 30th November. Thus, your case falls within the reasons mentioned in clauses © and (e) of paragraph 3 of the above mentioned instruction. Accordingly, as per the guidelines laid down in Date of Order 20-02-2018 W.P.No.5740/2018 M/s. Suman Vs. The Principal Commissioner of Income Tax-5 .. 4/7 paragraph 3.2 of this Instruction, the delay in payment of last instalment cannot be condoned. 5.0. Hence, your application for the condonation of delay in payment of last instalment of taxes under IDS, 2016 is rejected. Yours faithfully, Sd/- (Ramesh Narain Parbat) Pr. Commissioner of Income Tax-5 Bengaluru.” 4. The learned counsel for the petitioner assessee relying upon the decision of the Hon’ble Supreme Court in the case of Hemalatha Gargya Vs. Commissioner of Income Tax (2003) 259 ITR 1 (SC) submitted that in similar matter involving Voluntary Disclosure of Income Scheme, 1997 (VDIS,1997), the Hon’ble Supreme Court directed that though such time limit could not be extended for compliance by way of payment of due amount, but the Revenue Authorities were directed to refund or adjust the amounts already deposited by Date of Order 20-02-2018 W.P.No.5740/2018 M/s. Suman Vs. The Principal Commissioner of Income Tax-5 .. 5/7 the assessee in purported compliance with the Scheme to the concerned assessee in accordance with law. 5. Para.14. of the aforesaid judgment of the Hon’ble Supreme Court is quoted below for ready reference. “14. As a consequence, in our view, the appeals preferred by the assessee must be and are hereby dismissed whereas the appeals preferred by the Revenue authorities must be and are hereby allowed. However, having held that the assessees are not entitled to the benefit of the Scheme since the payments made by them were not in terms of the Scheme, we direct the Revenue authorities to refund or adjust the amounts already deposited by the assessees in purported compliance with the provisions of the Scheme to the concerned assessees in accordance with law. All the appeals are accordingly disposed of without any order as to costs.” 6. The learned counsel for the Respondent Mr. Jeevan J. Neeralgi submitted that the time period for payment of the third and final instalment could not have been extended by Date of Order 20-02-2018 W.P.No.5740/2018 M/s. Suman Vs. The Principal Commissioner of Income Tax-5 .. 6/7 the Principal Commissioner and Section 119(2)(b) of the Act does not apply in the facts and circumstances of this case. 7. Having heard the learned counsels for the parties, this Court is of the opinion that there is no justification or reason for invoking the extra-ordinary jurisdiction of this Court under Article 226 of the Constitution for interference in the matter of relaxation or extension of time limit as prayed for and therefore the Respondent Authority was justified in rejecting the said request of the petitioner, in view of the aforesaid Supreme Court decision. 8. However, in view of para.14 of the aforesaid judgment of the Hon’ble Supreme Court, the petitioner assessee will be free to approach the Respondent Authorities in accordance with law and the Respondent Authorities are expected to pass appropriate orders in the matter with regard to refund/adjustment of amount already deposited by the petitioner. Date of Order 20-02-2018 W.P.No.5740/2018 M/s. Suman Vs. The Principal Commissioner of Income Tax-5 .. 7/7 9. With these observations, the present writ petition stands disposed of. No costs. Sd/- JUDGE BMV* "