SHARP ENGINEERS THROUGH PARTNER BABUBHAI J PATEL V. INCOME TAX OFFICER TDS-3

SCA/4771/2019

AI Insights

In this case, Sharp Engineers, a partnership firm, filed a writ application under Article 226 of the Constitution of India against the Income Tax Officer TDS-3, challenging the recovery notices dated 04.06.2018 and 24.12.2018 for the assessment year 2008-09. The notices were issued for the alleged short payment of TDS amounting to Rs.2,34,020. The firm had previously deducted TDS and filed returns, but disputes arose over the amounts credited to the government. The Commissioner of Income Tax (Appeals) had directed the Assessing Officer to verify and credit the TDS payments, but recovery notices continued. The court found that the outstanding demand had been reduced to nil and was under correction at the CPC, Ghaziabad, leading to the disposal of the writ application with a directive to expedite the correction.

• Counselvise Citation: [2021] 140 COUNSELVISE.COM (IT) 759944 (HC-GUJARAT)
• Appeal Type: Others
• Pronouncement Date: 16-02-2021
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: MAUNA BHATT
• Assessee Lawyers: HARDIK VORA
• Keywords: Assessment Year 2008-09; Certiorari; Certiorari; Income Tax; Recovery notice; TDS
• Section: 201(1); 201(1A)

Judgement Text

"C/SCA/4771/2019 ORDER IN THE HIGH COURT OF GUJARAT AT AHMEDABAD R/SPECIAL CIVIL APPLICATION NO. 4771 of 2019 ========================================================= SHARP ENGINEERS THROUGH PARTNER BABUBHAI J PATEL Versus INCOME TAX OFFICER TDS­3 ========================================================== Appearance: MR. HARDIK V VORA(7123) for the Petitioner(s) No. 1 MRS MAUNA M BHATT(174) for the Respondent(s) No. 1 ========================================================== CORAM: HONOURABLE MR. JUSTICE J.B.PARDIWALA and HONOURABLE MR. JUSTICE ILESH J. VORA Date : 16/02/2021 ORAL ORDER (PER : HONOURABLE MR. JUSTICE J.B.PARDIWALA) 1. By this writ application under Article 226 of the Constitution of India, the writ applicant has prayed for the following reliefs: “a. A writ of certiorari or any other writ, order or direction in the nature of Certiorari quashing the impugned recovery notices dated 04.06.2018 and 24.12.2018 for the assessment year 2008­09 and directing the respondent to delete demand of Rs.2,34,020/­ raised on account of short payment of TDS; b. Pass any other order(s) as this Hon'ble May deem fit and more appropriate in order to grant interim relief to the petitioner. “ 2. We have heard Mr. Hardik V. Vora, the learned counsel appearing for the writ applicant and Mr. M.M.Bhatt, the learned Senior Counsel assisted by Mrs. Mauna M. Bhatt, the learned Sr. Standing Counsel appearing for the Revenue. 3. The controversy involved in the present litigation is in a narrow compass. The writ applicant being a Partnership Firm had deducted Page 1 of 4 C/SCA/4771/2019 ORDER the TDS under the various provisions of the Income Tax Act, 1961 (for short “The Act, 1961”). The assessee had also filed the TDS return in physical form for the F.Y. 2007­08 relevant to the A.Y. 2008­09 after paying due taxes on 09.05.2008. 4. The respondent passed an order under Section 201(1)/201(1A) of the Act, 1961 raising the demand of Rs.2,08,670/­ being the short payment towards the TDS. 5. Against such order, the writ applicant filed an appeal before the Commissioner of Income Tax (Appeals)­8. The Commissioner of Income Tax (Appeals)­8 directed the Assessing Officer to grant credit of the TDS deducted and deposited to the credit of the Central Government after due verification. 6. The Assessing Officer pursuant to the order passed by the Commissioner of Income Tax (Appeals) addressed a letter dated 21.04.2015 to the writ applicant requesting the writ applicant to produce certain documents for the purpose of giving effect to the CIT Appeals order. 7. It is the case of the writ applicant that he has furnished all the necessary information, but the recovery notices are still being issued by the Assessing Officer for the recovery of short payment. Page 2 of 4 C/SCA/4771/2019 ORDER 8. In such circumstances referred to above, the writ applicant is here before this Court with the present writ application. 9. Mr. Bhatt, the learned Sr. Counsel appearing for the Revenue invited the attention of this Court to the letter addressed by the Income Tax Officer, TDS­3, Ahmedabad, dated 20.03.2019 to the Commissioner of Income Tax (CPC), Ghaziabad, Uttar Pradesh, making a request to reduce the demand on the TRACES. According to Mr. Bhatt, the matter is pending at the end of the Commissioner of Income Tax (CPC), Ghaziabad, Uttar Pradesh. The letter is at page No.37 (Annexure­R­1) to the writ application. 10. In the aforesaid context, Mr. Bhatt also invited the attention of this Court to the averments made in Paragraph No.3.5 of the affidavit­in­ reply filed on behalf of the Revenue. Paragraph No.3.5 of the Affidavit­in­Reply reads thus: “3.5 With reference to para 4.1 to 5.1, it is submitted that this is general submission and prayer of the petitioner and therefore, the same requires to be looked into in the context of the above discussion and matter of facts. The outstanding demand in subject has been reduced to Nil and the petitioner has not been pressed to pay the said demand and the correction/deletion of outstanding demand shown online is under process at the level of CPC, Ghaziabad, therefore, the petition filed by the petitioner is Page 3 of 4 C/SCA/4771/2019 ORDER pre­mature , not correct and requires to be quashed.” 11. Thus, it appears from the above that, although the stance of the respondent herein is that the outstanding demand has been reduced to NIL, yet the necessary correction/deletion of the outstanding demand shown online is under the process at the level of CPC, Ghaziabad (U.P). The Commissioner of Income Tax (CPC), Ghaziaabad (U.P) is not before us as one of the party respondents. However, as the controversy is in narrow compass, we dispose of this writ application with a request to the Commissioner of Income Tax (CPC), Ghaziabad (U.P) to effect the necessary correction/deletion of the outstanding demand shown online within a period of four weeks from the date of receipt of this order. Registry shall forward one copy of this order to the Commissioner of Income Tax (CPC), Aaykar Bhavan, Sector­3, Vaishali, Ghaziyabad, Uttar Pradesh. 12. With the above, present writ application stands disposed of. (J. B. PARDIWALA, J) (ILESH J. VORA,J) SUCHIT Page 4 of 4 "