TMI Blog2007 (2) TMI 172X X X X Extracts X X X X X X X X Extracts X X X X ..... ised return as the case may be and proceed to take further action under the Act. The test is if a return pursuant to the notice u/s 147 of the Act could be processed, there is no reason as to why return filed otherwise cannot be processed. The defence put up by the respondents for not processing the return filed by the assessee in Form No. 2D is not supported by any provision of the statute and can only amount to inaction on the part of the respondents. The time stipulation prescribed for filing a return of income in terms of section 139 of the Act is operative on a person who is compelled to file a return in terms of section 139(1) of the Act. It is a person who has income over and above the exempted limit and whose income is taxable under the Act, who is required to file the return and while so, is bound to follow the period. The extended periods in terms of several sub-sections are also applicable to such persons. Therefore, to say that the income-tax authorities are disabled from scrutinising the return filed by the petitioner, in view of the time stipulation in terms of section 153 for processing such return may not be correctly apply at all. On the other hand, the emplo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... need be by invoking the provisions of section 147 also. Even without looking into the return, it will not be possible for the Assessing Officer to conclude that as there is no taxable income, no need to process the return, etc. Therefore, in either view of the matter, it will be necessary for the Assessing Officer to process the return and to pass orders in accordance with the provisions of the Act and not to justify the inaction. The petitioner having been put to the ordeal of not processing his return, declining an amount which he would have earned by his toil, the respondents are bound to compensate and I am of the view it calls for commensurate cost to be paid to the petitioner. Cost is also increased to make the respondents realise the effect of it, as this court cannot appreciate an inaction on the part of a public authority being put forth as a defence for not performing the duty and that in turn resulting in harassment and hardship to a hapless citizen like the petitioner, who is compelled to approach this court for relief. The endorsement bearing passed by respondent No.2 is hereby quashed by issue of a writ of certiorari. Writ petition allowed. - D. V. Shylen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... duction of Rs.29,331 deducted by his employer and remitted to the Income-tax Department. 5. Notices had been issued to the respondents and respondent No. 2 has entered appearance through his standing counsel. The statement of objections has also been filed. 6. While the facts are not in dispute, what is urged in the statement of objections is that the assessee having filed the return on May 18, 2006, is beyond the permitted time in terms of section 139(1) of the Act as according to the respondents, the return should have been filed by July 31, 2003, and the return filed on May 18, 2006, being even beyond the extended period permitted in terms of section 139(4) of the Act, the return is invalid and is treated as non est. It is also indicated that the respondents are fortified in taking such view in terms of the judgment of the Division Bench of the Calcutta High Court in the case of CIT v. Smt. Minabati Agarwalla reported in [1971] 79 ITR 278 and accordingly prayed for dismissal of the writ petition. 7. The petition was admitted and thereafter Sri Sukumaran, learned counsel for the petitioner and Sri Aravind, learned counsel for respondent No. 2 have been heard. 8. What ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le Bench decision of the Punjab and Haryana High Court in the case of Auto and Metal Engineers v. Union of India reported in [1978] 111 ITR 161. 13. The decision of the Calcutta High Court in Minabati' s case [1971] 79 ITR 278 was a decision rendered in the context of the provisions of sections 22(2), 22(3) and 34(3) of the Indian Income-tax Act, 1922, holding that as returns filed by the assessee in that case for the years 1953-54 to 1956-57 on August 9, 1961, were invalid, no fresh assessment could have been made on the basis of an order passed by the Commissioner under section 33B of the Indian Income-tax Act, 1922. The Calcutta High Court was answering the question which reads as under (page 283) : Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the returns filed by the assessee for the assessment years 1953-54 to 1956-57 on August 9, 1961, were invalid and that no fresh assessments could be made on the basis of the Commissioner' s order under section 33B of the Indian Income-tax Act ? 14. The learned judges on considering the case law on the point and also examining the decision of the Supreme Court answered ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n extension of time permitted under section 139(2) of the Act, just because the Income-tax Officer had impressed upon the assessee the need to file the return immediately in a letter addressed to the addressee. 22. The court again was involved with the question of validity of notice issued under section 147 of the Act in the context of a belated return by the assessee. 23. I am afraid, this decision does not apply to the case of the petitioner in the present situation. 24. Learned counsel for respondent No. 2 has also brought to the notice of the court section 119(2)(b) of the Act and submits that unless the petitioner files an application for refund before the Board and the Board directs for processing the return after condoning the delay, the Assessing Officer will not be in a position to process the return ; that the Board in exercise of its power under section 119 in turn can delegate the power to other officers of the Income-tax Department for the purpose of condoning any delay or non-compliance for which there are time stipulations and such power having been delegated to the Commissioner, it is necessary that the petitioner should apply to the Commissioner under this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... equally cannot apply. Therefore, to say that the Income-tax authorities are disabled from scrutinising the return filed by the petitioner, in view of the time stipulation in terms of section 153 for processing such return may not be correctly apply at all. On the other hand, the employer having deducted certain amount from the petitioner as deduction at source on the payment of salary/retiral benefits and having remitted it to the account of the Income-tax Department and this deduction being in terms of the provisions of the Act and if the assessee is not otherwise enabled to claim refund of this amount under any other statutory provisions and if he is not actually liable to pay the kind of income- tax deducted at source nor learned counsel for the respondent having pointed out to any enabling statutory provision, the only other way the petitioner can seek for refund of the amount is by filing a return of his income and as a result of the assessment if it is found the tax liability of the petitioner is nil, the Assessing Officer may take note of the amount already deducted from out of the amount paid to the petitioner by his employer and remitted to the Income tax Department and d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ities of invoking relaxation etc., which by itself does not place an embargo to process the return. 33. It is rather unfortunate that the Income-tax Department has taken such an adamant and stubborn stand only to deny a possible refund to the petitioner. An amount which would have been otherwise due to the petitioner if it is retained by the Income-tax Department without any justification, then inaction cannot be put up as a defence for retention of an amount. I say this because the amount which can be realised even by way of Income-tax from any assessee can only be in accordance with the statutory provisions, as is mandated under article 265 of the Constitution of India. 34. In terms of the law laid down by this court in the case of CIT v. P. Surendra Prabhu [2005] 279 ITR 402; [2005] 59 KLT 609 on which reliance is placed by learned counsel for the petitioner it does point out that in respect of any payment received by a person seeking voluntary retirement the first five lakhs rupees is exempt under section 10(10C) of the Act and in respect of balance of the amount, the tax deducted is not justified as the balance amount is one which entitles for exemption within the permis ..... X X X X Extracts X X X X X X X X Extracts X X X X
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