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TMI Blog2019 (10) TMI 263X X X X Extracts X X X X X X X X Extracts X X X X ..... ss of providing telecommunication services. The present Petition concerns the Assessment for the year 2016-17. The Petitioner filed its return of income on 30 November 2016 claiming a refund of Rs. 126,84,10,950/- and revised to Rs. 1,22,68,37,550/-, along with interest. Since the return of income filed by the Petitioner was not processed, the Petitioner filed a Writ Petition bearing No.964 of 2019 in this Court. The Writ Petition was disposed of on 10 June 2019, on the statement of the Respondents that return of income of the Petitioner for the Assessment Year 2016-17 would be processed within four weeks. The Division Bench accepted the statement and added that the consequences of the processing of the return would follow. 4. The representative of the Petitioner visited the office of the Deputy Commissioner of Income-tax to inquire about the processing the return, the Petitioner was informed that the same would be processed within the time limit given by the Court and as there were some technical issues due to which refunds due to the Petitioner could not be processed in time. The Respondent No.1- Deputy Commissioner on 8 July 2019 served a notice of demand under Section 156 of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he demand for Assessment Year 2013-14. 7. Before the Petitioner could respond to the above communication, on 5 August 2019 itself the Petitioner received another communication dated 2 August 2019 from the Assessing Officer - Deputy Commissioner of Income Tax intimating to the Petitioner that out of the refund of Rs. 147,22,06,945/- determined by him, an demand amount of Rs. 58,07,58,796/- (outstanding demand of Rs. 48,39,96,245/- for A.Y 2013-14 along with interest thereon) is being adjusted. The balance amount of Rs. 89.14 crores was the net refund handed over to the Petitioner, subsequent to the filing by this Petition. This fact was pointed out to the Court on 5 August 2019. 8. The Petitioner amended the Petition and sought the quashing of communication dated 2 August 2019 of the Deputy Commissioner of Income-tax to the extent it adjusted the demand and interest aggregating to Rs. 58,07,58,796/- for Assessment Year 2013-14 out of the refund of Rs. 147,22,04,945/- due for Assessment Year 2016-17. It also sought the quashing of adjustment under Section 245 of the Act. 9. We have heard Mr.Mistri, learned Senior Advocate appearing on behalf of the Petitioner and Mr.Suresh Kumar, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s found to be due to any person, the [Assessing] Officer, [Deputy Commissioner (Appeals)] [Commissioner (Appeals)] or [ [Principal Chief Commissioner] Chief Commissioner or [Principal Commissioner or ] Commissioner], as the case may be, may, in lieu of payment of the refund, set off the amount to be refunded or any part of that amount , against the sum, if any, remaining payable under this Act by the person to whom the refund is due, after giving an intimation in writing to such person of the action proposed to be taken under this section'. 14. In the case of Hindustan Unilever Ltd., the Division Bench of this Court observed that Section 245 empower the revenue to adjust refunds due to an assessee against any tax payable, but the exercise of this power, from the use of the word "may" employed therein, as is evident, is discretionary. The Division Bench observed that the notice/intimation enables a party to point out not only factual errors but also point out why such a power should not be exercised in the facts, such as the demand sought to be adjusted is still a subject -matter of appeal and the issue is covered by decisions of higher forums, etc. The observation of the Division ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er dated 19 February 2018. This letter was sent almost one and a half years prior to adjustment of the refund. The subject of the letter dated 19 February 2018 is a request for pending refunds. The Petitioner in the letter has listed the details of the refunds, which, according to the Petitioner, are due are aggregating to Rs. 860 Crores. The Petitioner explained its claim of the Assessment Years 1990-91, 1994-95, 2001-02, 2002- 03, 2009-10, 2015-16, 2016-17, 2017-18. The Petitioner claims these refunds are due under orders of the Tribunal, Appellate orders, processing of intimation under section 143(1) of the Act. After giving these details, the Petitioner has stated as under. '....... It may kindly be noted that all the above-referred refunds will be aggregating to about Rs. 860 crs. We have also agreed with the AO as well as Additional Commissioner of adjustment of our outstanding demand of about Rs. 82 crs. pertaining to AY 2013-14 against the above refunds due to us and releasing the balance. We shall be happy to provide you further clarifications in this regard. We sincerely request you to look into our above long overdue refunds with a view to get the same released ..... X X X X Extracts X X X X X X X X Extracts X X X X
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