VASCO SALES AND MARKETING CORPORATON V. DEPUTY COMMISSIONER OF INCOME TAX,

WP(C)/24109/2005

AI Insights

The case involves Vasco Sales and Marketing Corporation, represented by its managing partner V. Hameed, challenging the rejection of their refund claims for advance income tax paid for the assessment years 1996-97 and 1997-98. The petitioner argued that the delays in filing the tax returns were due to valid reasons and sought judicial intervention to quash the rejection orders and mandate a refund. The respondents, comprising various levels of the Income Tax Department, defended the rejection based on procedural adherence to the Income Tax Act, emphasizing that the returns were not filed voluntarily but in response to notices under Section 148 of the Act. The court, referencing a prior judgment, decided to condone the delay and remand the case for a fresh decision on the refund claims.

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 699834 (HC-KERALA)
• Appeal Type: Others
• Pronouncement Date: 01-03-2013
• Assessment Year: misc
• Other Referred Cases: Pala Marketing Co-op. Society Ltd. v. Union of India and Ors.
• Laws Referred To: Indian Income Tax Act
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: P K R MENON; GEORGE K GEORGE
• Assessee Lawyers: K P BALASUBRAMANYAN
• Keywords: Advance tax; Assessment years; Delay in filing; Income Tax Refund; Writ of Certiorari; Writ of Mandamus
• Section: 148; 139(1); 139(4); 119(2)(b); 239

Judgement Text

"IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR.JUSTICE B.P.RAY FRIDAY, THE 1ST DAY OF MARCH 2013/10TH PHALGUNA 1934 WP(C).No. 24109 of 2005 (T) ---------------------------- PETITIONER(S) : --------------------- VASCO SALES AND MARKETING CORPORATION, REP. BY ITS MANAGING PARTNER, V. HAMEED, 20/272-D KALLAI HEIGHTS, KALLAI, KOCHIKODE. BY ADV. SRI.K.P.BALASUBRAMANYAN RESPONDENT(S) : ----------------------- 1. DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-1, DIVISION-1, CALICUT. 2. THE COMMISSIONER OF INCOME TAX, CALICUT. 3. THE CHIEF COMMISSIONER OF INCOME TAX, COCHIN. R1 TO 3 BY ADVS. SRI.P.K.R.MENON,SR.COUNSEL,GOI(TAXES) SRI.GEORGE K. GEORGE, SC FOR IT THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 01-03-2013, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: BP WP(C).No. 24109 of 2005 (T) APPENDIX PETITIONER'S EXHIBITS : P1: COPY OF NOTICE DT 23/8/97 ISSUED TO THE PETITIONER, BY ASST. P2: COPY OF LETTER SENT BY PETITIONER TO THE ASST.COMMISSIONR OF INCOME TAX DATED 28/8/1997. P3: COPY OF NOTICE DT 16/9/1997 ISSUED BY ASST.COMMISSIONR OF INCOME TAX CIRCLE I, TO THE PETITIONER. P4: COPY OF EXPLANATION DT 21/10/97 SENT BY PETITIONER TO ASST. COMMISSIONR OF INCOME TAX CIRCLE - I, CALICUT. P5: COPY OF NOTICE DT 21/5/98 ISSUED TO PETITIONER BY ASST.COMMISSIONER OF INCOME TAX, CIRCLE -1. P6: COPY OF LETTER DT 22/6/98 ISSUED BY -DO- TO PETITIONER. P7: COPY OF RETURN FOR THE ASSESSMENT YEAR 1996-97 ON 30/6/98 AND A LETTER DT 30/6/98 TO -DO-. P8: COPY OF LETER DT 6/4/2001 SENT BY PETITIONER TO R1. P9: COPY OF NOTICE DT 25/6/2001 ISSUED BY R1 TO THE PETITIONER P10: COPY OF REPLY DTD 29/6/2001 SENT BY PETITIONER TO 1ST RESPONDENT. P11: COPY OF NOTICE DT 25/6/2001 SENT BY R1 TO THE PETITIONER. P12: COPY OF REPLY DT 29/6/2001 SENT BY PETITIONER TO TH R1. P13: COPY OF THE PROCEEDINGS NO.V-355/DC-I/CLT/2001-02 DT 17/4/2001. P14: COPY OF THE PETITIONS FILED BY THE PETITIONER FOR REFUND FOR THE YEAR 1996-97. P15: -DO- FOR THE YEAR 1997-97 P16: COPY OF ORDER OF THE RESPONDENT DT 3/3/2005. P17: COPY OF THE CORRIGENDUM DT 25/4/2005. RESPONDENT'S EXHIBITS : NIL. //TRUE COPY// P.A. TO JUDGE BP B.P.RAY, J. - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - W.P.(C)No.24109 OF 2005 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Dated this the 1st day of March, 2013 JUDGMENT The petitioner firm is an assessee under the Indian Income Tax Act. Exts.P13 and P16 orders of the first and third respondents rejecting the petitioner’s claim for refund of the advance income tax paid for the assessment years 1996-97 and 97-98 is under challenge in this writ petition. This writ petition is filed with the following prayers: a) to call for the records leading to Exts.P13 and P16 and quash the same by the issuance of a writ of certiorari or other appropriate writ, order or direction; b) to issue a writ of mandamus directing the respondents to order refund as claimed by the petitioner. 2. Learned counsel for the petitioner submits that for the assessment years 1996-97 and 1997-98, the petitioner firm could not file the returns under the Indian Income Tax Act and the returns were filed only after notice under Section 148 of the Act. Even after the notice, the petitioner firm could not file the returns and extension of time was requested. The return for 1996-97 was filed on 30-6-1998 and the total income was only Rs.2520/-. A total amount of Rs.1,26,451/- was paid as advance tax. Therefore the assessing authority dropped the proposal for imposing W.P.(C)No.24109 OF 2005 :: Page numbers :: penalty. Petitioner applied for refund of the tax which was rejected by the Chief Commissioner. Similarly for the assessment year 1997-98 also there was delay in filing the return. The return was ultimately filed on 29-2- 2000 declaring a loss of Rs.3,98,599/-. Since the request for refund of the advance tax was rejected by the Chief Commissioner, petitioner filed this writ petition. 3. Heard both sides and perused the materials available on record. 4. I have gone through the statement filed on behalf of the respondents wherein it is categorically stated that the returns for the assessment years in question were not filed by the petitioner voluntarily but fild only in response to notice issued under Section 148 of the Income Tax Act. In as much as the claim of refund having been filed belatedly without any valid reasons, the authorities had to reject the claim as laid down in the Income Tax Act. 5. Learned counsel for the petitioner has relied upon a judgment of this Honourable Court reported in 2008 (1) KLJ 561 (Pala Marketing Co-op. Society Ltd. v. Union of Indian and Ors.) wherein it is stated that the failure to condone the delay causes genuine hardship to the assessee. The relevant portion of the judgment reads as follows: W.P.(C)No.24109 OF 2005 :: Page numbers :: “Chapter XIV is mainly oriented to ensure assessment and recovery of tax to protect the interest of the Revenue. On the other hand, chapter XIV provides for refund and an application in this regard can be entertained only if it is filed within the time limit prescribed under Section 239 of the Act. In other words, if delay is not condoned by the Board under Section 119(2)(b), such application cannot be processed under Section 139(1) or 139(4) of the Act. I am therefore, of the view that in order to consider belated return for refund on merit, delay has to be necessarily condoned by the Board under Section 119(2)(b) of the Act.” 6. Considering the entire facts and circumstances of the case and following the decision cited above, I am of the view that the delay even though due to the fault of the petitioner, should liberally be condoned. Therefore, I condone the delay in filing the application for refund and remit the matter to the third respondent/Chief Commissioner of Income Tax to reconsider the application afresh on merits in accordance with law and pass appropriate orders within three months from the date of receipt of a copy of this judgment. Writ petition is disposed of. B.P.RAY, JUDGE jes "