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2013 (3) TMI 316 - HC - Income TaxWhether computerisation and Central Processing of Income Tax Returns is a boon or bane - Letter by CA Anand Prakash was treated as PIL - held that:- the respondents have taken a right decision to computerise the income tax records, have Central Processing Unit for processing of returns and issue of refunds. Besides, these steps relate to policy and fall within the exclusive domain of the respondents. These steps have to be appreciated as they ensure transparency, openness, eliminate high handedness and curtail corruption/red tapism. UPLOADING OF WRONG OR FICTITIOUS DEMAND - Rectification u/s 154 - held that:- Each application under Section 154 has to be disposed of and decided by a speaking order. This is the mandate of the Act. The order has to be communicated to the assessee and there is a relevant column to be filled in the register, which is now required to be maintained. The Board should issue specific directions to ensure that there is full compliance of the said requirements and directions by the Assessing Officers, Dak counters and Aayakar Sewa Kendras. This is the first mandamus or direction we have issued in the present judgment. ADJUSTMENT OF REFUND CONTRARY TO THE MANDATE OF SECTION 245 OF THE INCOME TAX ACT - held that:- have taken remedial steps to ensure compliance of Section 245 of the Act as they now give an option to the assessee to approach the Assessing Officer. This is the second mandamus which we have issued. As noticed above, the interim order passed in the writ petition [2012 (9) TMI 163 - DELHI HIGH COURT] has been implemented. Directions given in the order dated 21-8-2012, will be applicable only to cases where returns have been processed by the CPC Bengaluru and refunds have been fully or partly adjusted against the past arrears while passing or communicating the order under Section 143(1) of the Act, without following the procedure under Section 245 of the Act. The problem was created and caused by the respondents who did not realise the effect and impact of incorrect and wrong arrears being uploaded in CPU Bengaluru and did not follow the statutory requirements of Section 245 of the Act. Interest u/s 244A - held that:- An assessee can be certainly denied interest if delay is attributable to him in terms of sub-section (2) to Section 244A. However, when the delay is not attributable to the assessee but due to the fault of the Revenue, then interest should be paid under the said Section. False or wrong uploading of past arrears and failure to follow the mandate before adjustment is made under Section 245 of the Act, cannot be attributed and treated as a fault of the assessee. These are lapses on the part of the Assessing Officer i.e. the Revenue. Interest cannot be denied to the assessees when the twin conditions are satisfied and in favour of the assessee. However, even in such cases Assessing officer may deny interest for reasons to be recorded in writing if the assessee was in fault and responsible for the delay. This is the fourth mandamus which we have issued. Uncommunicated intimiations under Section 143(1) - held that:- The onus to show that the order was communicated and was served on the assessee is on the Revenue and not upon the assessee. We may note in case an order under Section 143(1) is not communicated or served on the assessee, the return as declared/filed is treated as deemed intimation and an order under Section 143(1). Therefore, if an assessee does not receive or is not communicated an order under Section 143(1), he will never know that some adjustments on account of rejection of TDS or tax paid has been made. While deciding applications under Section 154, or passing an order under Section 245, the Assessing Officers are required to know and follow the said principle. CREDIT OF TAX DEDUCTED AT SOURCE (TDS) - held that:- There can be mismatch because of deductor and the assessee may be following different methods of accounting. Further, the assessee may treat the income on which tax has been deducted as income for two or more different years. The respondents must take remedial steps and ensure that in such cases TDS is not rejected on the ground that the amounts do not tally. Of course, while issuing corrective steps, the respondents can ensure that fraudulent or double claims for TDS are not made. It is unfortunate that the Board did not take immediate steps after even noticing lacuna and waited till Finance Act, 2012, when Section 234E was enacted. Mere writing of a letter by the Assessing Officer to the deductor by no stretch can be treated as sufficient action on the part of the respondents. Even this, it appears, was done in a few cases as the respondents in the counter affidavit have stated that they have written 20119 communications to the tax deductors, where TDS credit claimed by the taxpayers did not match with the details loaded by the deductors. The Act empowers and authorises the Assessing Officer to verify the contents of the return and notices can be issued to a third party, i.e. the deductor, to furnish information and details. The deductor, the principal officer or person responsible for making deduction, once issued notice to appear, in most cases, would like to comply with the statutory requirements and also furnish details with regard to TDS deducted from the income of the assessee. - AO to exercise powers u/s 133.
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