Sri. Nagarajan Shanmugam V. The Income Tax Officer, Ward, Intl Taxation - 1(2) and The Deputy Commissioner of Income Tax, Circle 2(1)(1) and The Commissioner of Income Tax Appeals, National Faceless Appeal Centre

WP/8106/2024

AI Insights

The petitioner, Sri. Nagarajan Shanmugam, filed a writ petition seeking a mandamus to direct the Income Tax Officer to issue a refund of excess adjustment over and above 20% of the demand for the assessment year 2015-16, along with interest. The petitioner argued that despite the stay order requiring only a 20% deposit to avoid enforcement of the demand, the excess amount was adjusted against outstanding dues, which was impermissible as the appeals were pending. The court found merit in the petitioner's arguments, noting that the adjustments made were contrary to the stay order and directed the refund of the excess amount adjusted.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 796953 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 25-06-2024
• Assessment Year: misc
• Laws Referred To: Articles 226 and 227 of the Constitution of India
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: E I SANMATHI
• Assessee Lawyers: RAVISHANKAR
• Keywords: Appeal; Assessment Year 2015-16; Income Tax; Stay order; Writ of Mandamus; Refund of Excess Adjustment
• Section: 20

Judgement Text

" - 1 - NC: 2024:KHC:23255 WP No. 8106 of 2024 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 25TH DAY OF JUNE, 2024 BEFORE THE HON'BLE MR JUSTICE S SUNIL DUTT YADAV WRIT PETITION NO. 8106 OF 2024 (T-IT) BETWEEN: SRI. NAGARAJAN SHANMUGAM, 11916, PALISADES PKWY, AUSTIN, TX 78732, USA. PRESENTLY AT SRI NAGARAJAN SHANMUGAM, AGED ABOUT 59 YEARS, S/O VIDYALINGAM SHANMUGAM, A 306, MANTRI CLASSIC, 1ST MAIN, 8TH CROSS, S T BED LAYOUT, KORAMANGALA, BANGALORE - 560 034. PAN: ASEPS7463H …PETITIONER (BY SRI. RAVI SHANKAR S.V., ADVOCATE) AND: 1. THE INCOME TAX OFFICER, WARD, INTL TAXATION - 1(2), BMTC BUILDING, KORAMANGALA, BANGALORE - 560 095. 2. THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE 2(1)(1), BMTC BUILDING, KORAMANGALA, BANGALORE - 560 095. 3. THE COMMISSIONER OF INCOME TAX APPEALS, NATIONAL FACELESS APPEAL CENTRE, Digitally signed by VIJAYA P Location: HIGH COURT OF KARNATAKA - 2 - NC: 2024:KHC:23255 WP No. 8106 of 2024 INCOME TAX DEPARTMENT, MINISTRY OF FINANCE, ROOM NO. 401, 2ND FLOOR, E RAMP, JAWAHARLAL NEHRU STADIUM, DELHI - 110 003. …RESPONDENTS (BY SRI. E.I. SANMATHI, ADVOCATE) THIS WP IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO DIRECT THE R1 TO ISSUE A REFUND OF EXCESS ADJUSTMENT OVER AND ABOVE 20 PERCENT OF DEMAND, ALONG WITH INTEREST IN ACCORDANCE WITH LAW AND ETC., THIS PETITION, COMING ON FOR PRELIMINARY HEARING, THIS DAY, THE COURT MADE THE FOLLOWING: ORDER The petitioner has sought for issuance of writ of mandamus to direct respondent No.1 to issue a refund of excess adjustment over and above 20% of demand along with interest and has further sought for direction for transfer of the appeal for the assessment year 2015-16 from Commissioner of Income Tax (Appeals) NFAC to the file of CIT(A) International Taxation. 2. It is the case of the petitioner that insofar as the assessment year 2015-16 is concerned appeal has been filed bearing No. CIT(A),Bengaluru-2/10566/2017-18 as well as appeal No. CIT(A),Bengaluru-2/10602/2017-18. - 3 - NC: 2024:KHC:23255 WP No. 8106 of 2024 3. Insofar as such appeals are concerned for the Assessment Year 2015-16, the petitioner submits that there is an order of stay upon payment of 20% of demand as per Annexure-'F'. It is submitted that if that were to be so, as regards assessment year 2015-16 instead of refunding the remaining amount with the Revenue same has been adjusted as is evidenced from the Form-26AS entries at Annexure-G. It is submitted that this adjustment has been made insofar as the outstanding dues for the assessment year 2015-16 which is impermissible in light of appeal being filed. 4. Accordingly, it is submitted that all adjustments made towards liability for the assessment year 2015-16 after 31.03.2018 is required to be ordered to be refunded in light of the appeals having been filed and the order of stay coming into effect after which recovery or adjustment was impermissible. 5. Learned counsel for the revenue would submit that the adjustments having already been made, same - 4 - NC: 2024:KHC:23255 WP No. 8106 of 2024 would be subject to the outcome of the appeals referred to above and directions may be passed for disposing of the appeals. 6. It is not in dispute that for the assessment year 2015-16, two appeals are pending before the Appellate authority referred to above namely appeal No.CIT(A),Bengaluru-2/10566/2017-18 and appeal No.CIT(A),Bengaluru-2/10602/2017-18. If that were to be so and deposit of 20% of demand having been made while filing the appeal, consequently the demand for the said Assessment Year of 2015-16 ought not to have been enforced. 7. In light of the adjustments as is evidenced at Annexure-'G', the revenue is to redo the same by refunding the amount of refund adjusted in excess of 20% of demand in light of the appeal having been filed. 8. Accordingly, the Authority i.e., respondent No.1 is directed to pass orders of refund insofar as amount of - 5 - NC: 2024:KHC:23255 WP No. 8106 of 2024 refund adjusted beyond 20% of the demand in light of the appeals admittedly having been filed. Such refund need not await the conclusion of the appeals and becomes due immediately on the appeals having been filed and deposit of 20% having been made. 9. Further, the submission of learned counsel for the petitioner that the similar demand raised for the assessment year 2013-14 has been set aside and refund quantified which order has attained finality is a submission that is also taken note of while considering the relief that is granted in the present case. 10. The refund to be processed within two weeks from the date of receipt of certified copy of this order. Accordingly, petition is disposed off. Sd/- JUDGE MCR "