2020 (8) TMI 727 - HC - Income Tax

Income Tax Refund - Why refund is not being processed for years together when undisputedly the amount being claimed by way of refund is an amount realized from the assessee under coercion and misrepresentation? - whether the amount realized from the assessee is de hors the scheme of the Income Tax Act read with the circular issued by the CBDT from time to time? - Liberty to approach the competent authority under the Income Tax Department - petitioner involuntarily deposited an amount with the Income Tax Department in March 2009 threatened by the attachment of bank account and prosecution on the basis of survey conducted by the Department towards non-deduction of tax at source under Section 194 C - HELD THAT - Having considered the limited prayer made on behalf of the petitioner now in the light of the bare facts and the prayer made in the writ petition noted above we do not intend to get into the merits of the case at this stage. Petitioner if so advised may approach the competent authority for redressal of his grievance in accordance with law. In case such an application is made the competent authority under the Income Tax Department may endeavour to take decision thereupon within reasonable time preferably within 12 weeks from the date of receipt of copy of this order.

Summary

Issues:
1. Petitioner seeking issuance of writ for Income Tax refund processing delay.
2. Petitioner requesting offline refund application acceptance.
3. Petitioner's claim of coerced amount realization and misrepresentation.
4. Communication regarding unclaimed amount and manual refund process.
5. Competent authority approach for grievance redressal.

Analysis:

Issue 1: The petitioner sought relief for the delayed processing of Income Tax refund, claiming the amount was realized under coercion and misrepresentation. The petitioner deposited a substantial sum with the Income Tax Department in 2009 due to threats of account attachment and prosecution. Despite replying to a show cause notice, no order was passed. The petitioner approached the court in 2018 seeking redressal.

Issue 2: The petitioner also requested acceptance of an offline refund application due to technical issues preventing online claim submission. The petitioner urged for verification and refund processing with interest, emphasizing the inability to lodge an online claim because of website technicalities.

Issue 3: Reference was made to communications indicating unclaimed amounts and the manual refund process. The Deputy Commissioner communicated regarding the possibility of claiming a refund against a specific challan after nullifying a demand. The petitioner's counsel highlighted the need for details of the refund to be informed to prevent future use of the challan.

Issue 4: The Income Tax Department filed counter and supplementary affidavits, not objecting to the petitioner's prayer. The respondent's counsel acknowledged the possibility of manual refund issuance based on Circular No. 2/2011, emphasizing the need for due verification and procedure. Due to pandemic-related difficulties, a reasonable time was requested for decision-making.

Issue 5: The Court, without delving into the case's merits, directed the petitioner to approach the competent authority for grievance redressal. The Court emphasized that it had not made any observations on the case's substance and instructed the competent authority to decide within 12 weeks of receiving the order copy. The writ petition was disposed of, with pending applications closed.