HERO MOTOCORP LTD vs. DEPUTY COMMISSIONER OF INCOME TAX CENTRAL CIRCLE 27 DELHI & ANR.
What did the High Court hold?
The Delhi High Court considered it appropriate to dispose of the writ petition by directing the concerned authority to pass an appeal effect order as expeditiously as possible, within a period of eight weeks from the date of the order. Furthermore, the Court directed the concerned authority to process the petitioner's claim for refund within a period of four weeks thereafter, in accordance with the law. The Court did not delve into the merits of the original tax dispute, as the ITAT's order had already provided relief to the assessee, and the focus was on the procedural compliance and refund of the deposited taxes. The principle established is that once an appellate authority sets aside a demand and no further appeal is preferred, the revenue authorities are bound to implement the order and refund any taxes collected against the set-aside demand promptly.
What were the facts?
The petitioner, Hero Motocorp Ltd., filed a writ petition before the Delhi High Court seeking directions to pass an appeal effect order for Assessment Year (AY) 2011-12 and to refund tax paid. Reassessment proceedings for AY 2011-12 resulted in an addition of ₹3644.85 crores and a demand of ₹2336.70 crores. The Commissioner of Income Tax (Appeals) upheld the reassessment order. However, the Income Tax Appellate Tribunal (ITAT), by an order dated 24.07.2024, set aside the addition and the consequent demand. The petitioner had deposited ₹375,50,59,630/- against the disputed demand. The Revenue had not appealed the ITAT's order. The petitioner was aggrieved by the delay in passing the appeal effect order and refund of the deposited amount.
What were the issues?
1. Whether the High Court should direct the concerned authority to pass an appeal effect order in respect of Assessment Year 2011-12 to implement the ITAT's order dated 24.07.2024? (Question of procedure/mandate) 2. Whether the High Court should direct the concerned authority to refund the tax paid by the petitioner after the ITAT's order set aside the demand? (Question of refund/compliance) Assessee's Contentions: The petitioner argued that the ITAT had set aside the addition and demand for AY 2011-12, and the Revenue had not appealed this decision. Despite this, an appeal effect order had not been passed, and the substantial amount deposited by the petitioner was not being refunded. The petitioner sought directions for prompt action from the revenue authorities. Revenue's Contentions: The judgment records no specific contentions from the Revenue. However, the presence of Revenue's counsel indicates their participation in the proceedings.
AI-generated summary — verify with the full judgment below
Cause title — parties, addresses and appearances
O R D E R %
2025
The petitioner has filed the present petition, inter alia, praying that directions be given to pass an appeal effect order in respect of Assessment Year [AY] 2011-12 for implementing the order dated 24.07.2024 passed by the Income Tax Appellate Tribunal [ITAT] in ITA No.1053/Del/2023. 2. The petitioner also prays that directions be issued for refund of the tax paid after adjusting twenty per cent of the outstanding demands for other years. It is stated that reassessment proceedings for AY 2011-12 were initiated, which culminated in re-assessment order dated 29.12.2018 whereby the Assessing Officer [AO] has made an addition of ₹3644.85 crores, to the income of the assessee. Consequently, a demand of ₹2336.70 crores was raised. The petitioner appealed the said re-assessment order This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 01/07/2025 at 23:50:16
before the Commissioner of Income Tax (Appeals) [CIT(A)] but was unsuccessful and, by an order dated 28.03.2023, CIT(A) upheld the said order.
Thereafter, the petitioner filed the aforementioned appeal before the ITAT, which was decided in favour of the petitioner, by an order dated 24.07.2024. Thus, the addition of ₹3644.85 crores and a consequent demand of ₹2336.70 crores was set aside. The petitioner states that the Revenue has not preferred any appeal against the order dated 24.07.2024 passed by the ITAT.
In the meanwhile, the petitioner had deposited an aggregate amount of ₹375,50,59,630/- against the disputed demand. The tabular statement indicating the dates on which various deposits were made as under: Date of challan Challan no. Amount (Rs.) 26-03-2019 01660 280,00,00,000 02-07-2020 05076 29,00,00,000 01-09-2020 03516 14,00,00,000 01-12-2020 07517 14,00,00,000 01-03-2021 07042 13,50,59,630 12-05-2023 04018 25,00,00,000
Total
375,50,59,630
The petitioner is essentially aggrieved on account of the concerned officer not passing an appeal effect order and not refunding the amount, which was deposited by the petitioner pursuant to then outstanding demand in respect of AY 2011-12 notwithstanding that the same since been set aside.
In the aforesaid circumstances, we consider it apposite to dispose of the present petition by directing the concerned authority to pass an appeal effect order, as expeditiously as possible, in any event, within a period of This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 01/07/2025 at 23:50:16
eight weeks from date. The concerned authority should also process the petitioner’s claim for refund within a period of four weeks thereafter in accordance with law.
The petition is disposed of with the aforesaid directions. Pending application(s) also stands disposed of.
VIBHU BAKHRU, J
TEJAS KARIA, J APRIL 01, 2025/’A’
Click here to check corrigendum, if any This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 01/07/2025 at 23:50:16
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