SMT. P . JAISHREE, V. THE CHIEF COMMISSIONER OF

WP/7660/2023

AI Insights

The case involves Smt. P. Jaishree, the petitioner, who sought to quash an order by the Income Tax authorities that rejected her application for a tax refund on compensation received for land acquisition. The petitioner had initially paid tax on this compensation, unaware of its exemption under the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013. Upon discovering the exemption, she filed an application under Section 119(2)(b) of the Income Tax Act, 1961, which was rejected due to delay and on merits. The court found that the respondents erred in law by not applying the exemption correctly and adopted a hyper-technical approach in rejecting the condonation of delay.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 725985 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 09-01-2024
• Assessment Year: misc
• Other Referred Cases: Bangalore Metro Rail Corporation Limited v. M/s. Sri Balaji Corporate Services and Others
• Laws Referred To: Income Tax Act, 1961, Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: E I SANMATHI
• Assessee Lawyers: BORKAR SUBODH
• Keywords: Condonation of delay; Exemption; Income Tax; Land acquisition compensation; Refund; Writ petition
• Section: 119(2)(b); 226; 227

Judgement Text

"- 1 - NC: 2024:KHC:949 WP No. 7660 of 2023 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 9TH DAY OF JANUARY, 2024 BEFORE THE HON'BLE MR JUSTICE S.R.KRISHNA KUMAR WRIT PETITION NO. 7660 OF 2023 (T-IT) BETWEEN: SMT. P . JAISHREE, NO.16/4, NH SCHOOL ROAD, V.V. PURAM,BENGALURU-560004 AGED ABOUT 71 YEARS. …PETITIONER (BY SMT. BORKAR SHEETAL SUBODH.,ADVOCATE) AND: 1. THE CHIEF COMMISSIONER OF INCOME TAX, BENGALURU-1, 2. THE PR. COMMISSIONER OF INCOME TAX, BENGALURU-3, BENGALURU. 3. THE INCOME TAX OFFICER, ITO-WARD5(2)(3), BENGALURU. …RESPONDENTS (BY SRI.E.I. SANMATHI.,ADVOCATE) THIS WP IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE IMPUGNED ORDER DATD.8.03.2023, PASSED BY THE Digitally signed by ANAND N Location: HIGH COURT OF KARNATAKA - 2 - NC: 2024:KHC:949 WP No. 7660 of 2023 CONCERNED RESPONDENT AUTHORITY VIDE F.NO.COND.119(2)(B)/ CCIT/BNG-1/2022-23 PASSED IN DIN.ITBA/COM/S/91/2022-23/1051049705(91), VIDE ANNX-D; DIRECT THE CONCERNED R1 AUTHORITY TO CONSIDER THE APPLICATION UNDER SEC.119(2)(B) OF THE ACT DATED 09.09.2019 VIDE ANNX-C TO CONSIDER THE SAID APPLICATION FILED BY THE PETITIONER AND THEREAFTERPASS AN ORDER TO E-FILE THE RETURNS UNDER SEC.119(2)(B) IN RESPECT TO THE EXEMPTION CLAIMED BY THE PETITIONER, UNDER THE INCOME TAX ACT, 1961 AND ALLOW THE SAME AND TO REFUND THE AMOUNT AS PER THE COMPUTATION OF INCOME. THIS PETITION, COMING ON FOR ORDERS, THIS DAY, THE COURT MADE THE FOLLOWING: ORDER In this petition, the petitioner seeks the following reliefs: “[i] Issue a Writ of Certiorari or in the like nature of writ, quashing the impugned order dated 08.03.2023, passed by the concerned respondent Authority vide F. No.Cond.119[2][b]/CCIT/BNG- 1/2022-23 passed in DIN:ITBA/COM/S/91/2022- 23/1051049705[1] vide Annexure-D; [ii] Issue a Writ of Mandamus or in the like nature of writ, directing the concerned respondent No.1 authority to consider the application under Section 119[2][b] of the Act dated 22.02.2022 vide - 3 - NC: 2024:KHC:949 WP No. 7660 of 2023 Annexure-C, by condoning the delay thereon in filing the same, consider the said application filed by the petitioner and thereafter pass an order in respect to the exemption claimed by the petitioner, under the Income Tax Act, 1961 and allow the same.” 2. Heard the learned counsel for the parties and perused the material on record. 3. The material on record discloses that the petitioner who is the individual assessee under the Income Tax Act, 1961 [for short, ‘the IT Act’] filed her income tax returns for the assessment year 2018-19 and in the said returns, she voluntarily disclosed tax in respect of long term capital gains for receiving compensation from the concerned authority-Karnataka Industrial Areas Development Board. It is contended that the petitioner was unaware of the exemption for deduction of tax deducted at source as well as payment of tax in respect of the land acquisition compensation received by her and when she came to know about the same, she submitted an application under Section 119[2][b] of the IT Act seeking - 4 - NC: 2024:KHC:949 WP No. 7660 of 2023 condonation of delay and sought for refund accordingly. The said application was considered by the respondent who proceeded to reject the same both on the ground of delay as well as on merits by passing the impugned order dated 08.03.2023 which is assailed in the present petition. 4. Insofar as the entitlement of the petitioner to claim exemption from payment of income tax on the land acquisition compensation under the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 is concerned, the said issue/question is truly and squarely covered by the Division Bench decision of this Court in the case of ‘BANGALORE METRO RAIL CORPORATION LIMITED v. M/s. SRI BALAJI CORPORATE SERVICES AND OTHERS’ in W.A. No.890/2022 and connected matters disposed of on 27.09.2023, wherein it is held that the land acquisition compensation is exempted from payment of income tax. Applying the law laid down by the Hon’ble Division Bench, I am of the considered opinion that the respondents committed error in rejecting the request of the - 5 - NC: 2024:KHC:949 WP No. 7660 of 2023 petitioner for refund of the tax collected by them in relation to the subject land acquisition compensation. 5. Insofar as the reasons assigned by the respondents to reject the request of the petitioner for condonation of delay is concerned, a perusal of the impugned order will indicate that the respondents had adopted hyper technical approach and failed to consider and appreciate the reasons assigned by the petitioner in her application dated 22.02.2022 which clearly constituted valid and sufficient cause for not being able to submit the refund application within the prescribed period. Under these circumstances, the impugned order rejecting the request for condonation of delay is also contrary to the material on record and the same deserves to be quashed on this ground also. In the result, the following: ORDER [a] The petition is hereby allowed. - 6 - NC: 2024:KHC:949 WP No. 7660 of 2023 [b] The impugned order dated 08.03.2023 [Annexure-D] of the respondent No.1 is set aside. [c] The respondent No.1 is directed to refund the entire tax collected by the respondents back to the petitioner as expeditiously as possible and at any rate within a period of one month from the date of receipt of a copy of this order. Sd/- JUDGE AN/- "