M/S GVK JAIPUR EXPRESSWAY PVT. LTD. vs. ASSISTANT COMMISSIONER OF INCOME TAX
What did the High Court hold?
The High Court allowed the writ petition. The Court held that the respondents had no legal authority to withhold the refund amount payable to the petitioner in compliance with the order dated 02.11.2021 passed by the Appellate Authority. The reasoning was that the respondents could not point to any provision in the Income Tax Act, 1961, that empowered them to withhold such a refund. The Court acknowledged that other proceedings for subsequent assessment years might be pending, but this did not justify withholding the refund for the assessment year in question. The ratio decidendi is that a refund due as per an appellate order must be released unless there is a specific legal provision or a stay order preventing its release. The operative direction was for the respondents to forthwith refund the amount payable to the petitioner. The Court clarified that this refund would not impede the respondents' authority to recover tax for other assessment years.
What were the facts?
M/s GVK Jaipur Expressway Pvt. Ltd. (the petitioner) filed a writ petition before the High Court of Rajasthan, Jaipur Bench, seeking a refund of tax. The petitioner's grievance was that despite an order dated 02.11.2021 passed by the Commissioner of Income Tax (Appeals) National Faceless Appeal Centre in their favour, the respondents (Assistant Commissioner of Income Tax and Deputy Commissioner of Income Tax, Circle-7, Jaipur) were illegally withholding the refund amount. The court noted that there were no interim orders operating against the petitioner regarding the refund. The respondents were unable to point to any provision of the Income Tax Act, 1961, that empowered them to withhold the refund.
What were the issues?
1. Whether the respondents have the legal authority to withhold the refund amount due to the petitioner, notwithstanding the order dated 02.11.2021 passed by the Commissioner of Income Tax (Appeals) in favour of the petitioner? (Question of law) Assessee's Contention: The petitioner argued that the respondents were illegally withholding the refund amount despite a favourable order from the Appellate Authority and the absence of any interim orders against them. The petitioner sought a direction for the release of the refund. Revenue's Contention: The respondents' counsel was unable to cite any provision of the Income Tax Act, 1961, that authorized them to withhold the refund. While the revenue mentioned other proceedings pending for subsequent assessment years, they could not justify withholding the refund for the assessment year covered by the appellate order.
Which sections of the Income-tax Act were involved?
Income Tax Act, 1961
AI-generated summary — verify with the full judgment below
Cause title — parties, addresses and appearances
Order 17/05/2023
This petition has been filed by the petitioner seeking relief of refund in view of order dated 02.11.2021 passed by the Commissioner of Income Tax (Appeals) National Faceless Appeal Centre (hereinafter referred to as ‘the Appellate Authority’) in its favour.
[2023/RJJP/011116] (2 of 3) [CW-14597/2022]
The petition, in nutshell, ventilates the grievance that even though at present there are no interim orders operating against the petitioner in the matter of refund, arising as a result of the order passed by the Appellate Authority in favour of the petitioner, the respondents have illegally and without authority of law withheld the amount of refund with them and sat over the matter. It is not in dispute that the Appellate Authority passed the order on 02.11.2021. There is no material on record to show that there is any interim order operating against the order passed by the Appellate Authority.
Taking into consideration the aforesaid aspect of the matter, this Court, on 28.04.2023, granted time to learned counsel for the respondents to show cause as to why the petition be not allowed and appropriate direction for release of the refund amount be not issued.
Today, learned counsel for the respondents prays for some more time. When this Court enquired as to under what authority of law such amount has not been released, learned counsel for the respondents is unable to point out to us any provision contained in the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) which entitles the respondent to withhold the refund amount.
Though learned counsel for the respondent would submit that there are other proceedings pending against the petitioner in the matter of demand of tax for subsequent assessment years, in the absence of there being any authority under the law to withhold the amount of refund otherwise payable to the petitioner in view of the adjudication in its favour in relation to previous assessment
[2023/RJJP/011116] (3 of 3) [CW-14597/2022] year, there is absolutely no justification for the respondents to withhold the amount of refund.
In view of above consideration, we are inclined to allow the writ petition with direction to the respondents to refund forthwith the amount payable to it under the law in compliance of order dated 02.11.2021 passed by the Appellate Authority.
However, the aforesaid refund shall not come in the way of the respondents in respect of their authority to recover the tax so far as any other assessment year is concerned.
Writ petition is, accordingly, allowed. (ANIL KUMAR UPMAN),J (MANINDRA MOHAN SHRIVASTAVA),ACTING CJ MANOJ NARWANI /20
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