DR.VIVEK S. vs. DEPUTY COMMISSIONER OF INCOME TAX

WP(C)/15848/2021HC KeralaKLHC01042196202125 July 2022Author: HONOURABLE MR. JUSTICE GOPINATH P.5 pages

AI SummaryRemanded

What did the High Court hold?

The High Court noted the submissions of both parties. The Income Tax Department confirmed that the employer had remitted the TDS amount of Rs.79,207/- for FY 2016-17 on July 8, 2022, and had filed a revised TDS statement. This amount was credited to the petitioner's PAN and reflected in his Form 26AS for AY 2017-18. The Department further submitted that upon this credit, the entire demand, including interest, would be extinguished, and the petitioner would be entitled to a refund. The liability for interest on delayed payment would be pursued against the employer. The Court recorded these submissions and closed the writ petition, making it clear that the petitioner could approach the competent authority for any necessary applications regarding the refund or any other consequential relief.

What were the facts?

The petitioner, Dr. Vivek S., a former employee of Al-Azhar Medical College & Super Specialty Hospital (additional 3rd respondent), filed a writ petition before the High Court of Kerala. He was aggrieved by demands raised against him for Assessment Year 2017-18, stemming from the employer's failure to remit Tax Deducted at Source (TDS) for Financial Year 2016-17 in a timely manner. The petitioner argued that due to this delay, he was burdened with interest liability, even though his total tax liability, excluding interest, was less than the TDS amount. The Income Tax Department (respondents 1 and 2) stated that the employer had remitted the TDS amount of Rs.79,207/- on July 8, 2022, and filed a revised TDS statement. This amount was reflected in the petitioner's Form 26AS, and he had received credit for it.

What were the issues?

1. Whether the petitioner is liable to pay interest on delayed TDS remittance when the delay was caused by the employer and the TDS amount has now been credited to the petitioner's account? The assessee (petitioner) contended that he was unfairly burdened with interest liability for no fault of his own, as the delay in TDS remittance was solely attributable to the employer. He highlighted that his total tax liability for AY 2017-18, excluding interest, was Rs.73,027/-, which was less than the TDS credit of Rs.79,207/- now available to him. The assessee relied on the fact that the TDS amount has now been remitted and credited to his PAN. The revenue (respondents 1 and 2) submitted that upon crediting the TDS amount to the petitioner, the entire demand, including interest, would be wiped out, and the petitioner would be entitled to a refund. They further stated that the liability to pay interest for the delayed payment would now be raised against the employer (additional 3rd respondent).

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE GOPINATH P. MONDAY, THE 25TH DAY OF JULY 2022 / 3RD SRAVANA, 1944 WP(C) NO. 15848 OF 2021 PETITIONER: DR.VIVEK S. AGED 43 YEARS, SON OF A.N.SUKUMARAN NAIR, AMBATTUKUNNEL HOUSE, M.A.COLLEGE JUNCTION, KOTHAMANGALAM. BY ADVS. S.VINOD BHAT ANAGHA LAKSHMY RAMAN GREESHMA CHANDRIKA.R RESPONDENTS: 1 DEPUTY COMMISSIONER OF INCOME TAX, CENTRALISED PROCESSING CENTRE, 1ST FLOOR, PRESTIAGE ALPHA NO.1, 48/1, BERATENAAGRAHA, BEGUR, HOSUR ROAD, BANGALORE - 560 100. 2 COMMISSIONER OF INCOME TAX, CR BUILDING, I.S.PRESS ROAD, KOCHI - 682 018. 3 ADDL.R3.AL-AZHAR MEDICAL COLLEGE & SUPER SPECIALTY HOSPITAL, EZHALLOOR, THODUPUZH, REPRESENTED BY ITS CHAIRMAN, PIN – 685 605. ADDL.R3 IS IMPLEADED AS PER ORDER DATED 05.11.2021 IN IA 1/2021 IN WPC NO. 15848/2021 BY ADVS. CHRISTOPHER ABRAHAM, INCOME TAX DEPARTMENT V.K.PEERMOHAMED KHAN GIRISH KUMAR V.C THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 25.07.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C) NO. 15848 OF 2021 2

JUDGMENT The petitioner, who was employed by the additional 3rd respondent has approached this Court being aggrieved by the fact that the additional 3rd respondent had not remitted the amounts of tax deducted at source for the financial year 2016-17 from the salary paid to the petitioner to the Income Tax Department in time, as a result of which, certain demands have now been raised on the petitioner through Ext.P13 order of assessment for the assessment year 2017-18. 2. Today, when the matter is taken up for consideration, it is submitted by the learned Standing Counsel appearing for respondents 1 and 2 that a statement has been filed on behalf of respondents 1 and 2, from which it is pointed out that an amount of Rs.79,207/- representing the amount of TDS deducted from the petitioner's salary has been remitted by the additional 3rd respondent on 08.07.2022. It is submitted that the additional 3rd respondent has also filed a revised TDS statement for financial year 2016-2017 and the petitioner has therefore obtained a credit of Rs.79,207/- pertaining to assessment year 2017-2018 in respect of his PAN number. It is submitted that the said amount is now reflected in the 26AS account of the petitioner.

WP(C) NO. 15848 OF 2021 3

The learned counsel for the petitioner would point out that on account of non payment of TDS in time, the petitioner was mulcted with a liability to pay interest as is evident from Ext.P13. It is submitted that for no fault of the petitioner, he has been mulcted with a liability to pay interest as the total tax liability of the petitioner as seen in Ext.P13, dehors the interest is only Rs.73,027/-, which is less than the amount of TDS credit now available to the petitioner, for the relevant assessment year.

The learned Standing Counsel would submit that on the credit of the TDS amount being given to the petitioner, the entire demand including the interest shown in Ext.P13 will be wiped out and the petitioner will be entitled to a small amount of refund. It is submitted that the liability to pay interest for the delayed payment will now be raised on the additional 3rd respondent. This is recorded and the writ petition is closed, making it clear that the petitioner may, if necessary, prefer appropriate application before the competent authority for the above. GOPINATH P. JUDGE DK

WP(C) NO. 15848 OF 2021 4

Appendix — schedule of exhibits

APPENDIX OF WP(C) 15848/2021 PETITIONER EXHIBITS Exhibit P1 COPY OF EXPERIENCE CERTIFICATE DATED 08/06/2017 ISSUED BY AL-AZHAR MEDICAL COLLEGE HOSPITAL, THODUPUZHA. Exhibit P2 COPY OF APPOINTMENT ORDER DATED 01/06/2014 ISSUED BY AL-AZHAR MEDICAL COLLEGE SUPER SPECIALITY HOSPITAL, THODUPUZHA. Exhibit P3 COPY OF TABULAR CHART SHOWING THE TOTAL INCOME DRAWN BY THE PETITIONER FOR THE ASSESSMENT YEAR 2015-16. Exhibit P4 COPY OF TABULAR CHART SHOWING THE TOTAL INCOME DRAWN BY THE PETITIONER FOR THE ASSESSMENT YEAR 2016-17. Exhibit P5 COPY OF TABULAR CHART SHOWING THE TOTAL INCOME DRAWN BY THE PETITIONER FOR THE ASSESSMENT YEAR 2017-18. Exhibit P6 COPY OF FORM 26AS EVIDENCING DEDUCTION OF INCOME TAX AT SOURCE FOR THE ASSESSMENT YEAR 2015-2016. Exhibit P7 COPY OF FORM 26AS EVIDENCING DEDUCTION OF INCOME TAX AT SOURCE FOR THE ASSESSMENT YEAR 2016-2017. Exhibit P8 COPY OF INCOME TAX RETURNS FILED BY THE PETITIONER FOR THE ASSESSMENT YEAR 2015- 2016. Exhibit P9 COPY OF INCOME TAX RETURNS FILED BY THE PETITIONER FOR THE ASSESSMENT YEAR 2016- 2017. Exhibit P10 COPY OF E-MAIL LETTER DATED 16/03/2018 SENT BY THE PETITIONER TO EMPLOYER. WP(C) NO. 15848 OF 2021 5 Exhibit P11 COPY OF E-MAIL LETTER DATED 12/05/2018 SENT BY THE PETITIONER TO EMPLOYER. Exhibit P12 COPY OF INCOME TAX RETURNS FILED BY THE PETITIONER FOR THE ASSESSMENT YEAR 2017- 2018. Exhibit P13 COPY OF COMPUTERIZED INTIMATION DATED 13/06/2018 ISSUED BY THE 1ST RESPONDENT. Exhibit P14 COPY OF OFFICE MEMORANDUM DATED 11/03/2016. Exhibit P15 COPY OF LETTER DATED 28/04/2021 SENT BY THE PETITIONER TO THE 2ND RESPONDENT. Exhibit P16 COPY OF FORM 26AS UNDER SECTION 203AA OF INCOME TAX ACT FOR THE ASSESSMENT YEAR 2017-2018. Exhibit P17 COPY OF ACCOUNT STATEMENT PERTAINING TO THE FINANCIAL YEAR 2016-2017 Exhibit P18 COPY OF ACCOUNT STATEMENT PERTAINING TO THE MONTH OF APRIL, 2017

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