LEELA BIHARI FINANCE PRIVATE LIMITED vs. INCOME TAX OFFICER WARD 15(1) DELHI & ANR.

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W.P.(C)/6399/2025HC DelhiDLHC01029755202529 May 2025Bench: HON'BLE MR. JUSTICE VIBHU BAKHRU,HON'BLE MR. JUSTICE TEJAS KARIA2 pages
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What did the High Court hold?

The Delhi High Court disposed of the writ petition by directing the Revenue to manually process the petitioner's claim for refund amounting to Rs. 23,26,610/- for AY 2023-24, along with applicable interest, within a period of ten weeks from the date of the order. The Court clarified that the petitioner would be paid interest on the footing that the refund had not been adjusted. The Court also granted liberty to the petitioner to revive the petition if the cause arose. The primary reasoning was the undisputed erroneous adjustment of the refund against a settled demand, necessitating a directive for manual processing due to system limitations acknowledged by the Revenue.

What were the facts?

The petitioner, Leela Bihari Finance Private Limited, filed a writ petition before the Delhi High Court seeking a mandamus to process and pay a refund of Rs. 23,26,610/- for Assessment Year (AY) 2023-24, along with applicable interest. The petitioner stated that this refund was erroneously adjusted against a demand for AY 2012-13. However, the demand for AY 2012-13 had been settled under the Direct Tax Vivad se Vishwas Scheme, 2020, with a final certificate issued on January 19, 2024, after the adjustment had already occurred. The Revenue did not dispute the erroneous adjustment but cited system limitations for manual processing, estimating a ten-week timeframe.

What were the issues?

1. Whether the Revenue should be directed to process and pay the refund of Rs. 23,26,610/- for AY 2023-24, along with applicable interest, to the petitioner? (Question of law and fact, concerning the Income Tax Act, 1961). Assessee's Contention: The petitioner argued that the refund for AY 2023-24 was wrongly adjusted against a demand for AY 2012-13, which had already been settled under the Vivad se Vishwas Scheme, 2020, evidenced by a certificate dated January 19, 2024. Therefore, the adjustment was erroneous, and the refund along with interest should be paid. Revenue's Contention: The Revenue conceded that the adjustment was erroneous. However, they stated that the system lacked the functionality to process the refund directly and it would require manual processing, which would take approximately ten weeks if directions were issued.

Which sections of the Income-tax Act were involved?

None explicitly mentioned in the provided text, other than the general reference to the Income Tax Act, 1961 and the Direct Tax Vivad se Vishwas Scheme, 2020.

AI-generated summary — verify with the full judgment below

$~3 * IN THE HIGH COURT OF DELHI AT NEW DELHI + W.P.(C) 6399/2025

LEELA BIHARI FINANCE PRIVATE LIMITED .....Petitioner Through: Mr. Ruchesh Sinha, Ms. Monalisa Maity, Advocates.

versus

INCOME TAX OFFICER WARD 15(1) DELHI & ANR.

.....Respondents Through: Mr. Abhishek Maratha, SSC; Mr. Apoorv Agarwal, JSC; Mr. Parth Samwal, JSC with Ms. Nupur Sharma, Mr. Gaurav Singh, Mr. Bhanukaran Singh Jodha, Ms. Muskaan Goel, Mr. Himanshu Gaur, Advocates for Revenue.

CORAM:

HON'BLE MR. JUSTICE VIBHU BAKHRU

HON'BLE MR. JUSTICE TEJAS KARIA

O R D E R %

29.05.2025

1.

The petitioner has filed the present petition, inter alia, praying as under: “a. To admit the writ petition on merits as this Hon’ble Court has full jurisdiction to hear the same.

b. That this Hon’ble Court may be pleased to issue a writ of mandamus, or any other appropriate writ, order or directing the Respondents to process and pay the refund amounting to Rs. 23,26,610/- for the A.Y. 2023- 24alongwith the applicable interest under the provisions of the Income Tax Act, 1961 to the Petitioner.”

2.

The petitioner states that the refund amount due in respect of Assessment Year [AY] 2023-24 had been adjusted against demand relating to AY 2012-13, however, the said demand never existed as the dispute was 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 19:42:15

settled under the Direct Tax Vivad se Vishwas Scheme [DTVSV], 2020. The said adjustment had taken place after the dispute relating to AY 2012- 13 was fully settled and a final certificate dated 19.01.2024 had been issued by the designated authority. 3. The learned counsel appearing for the Revenue does not dispute that the adjustment of the demand was erroneous. He, however, states that there is no functionality in the system to process the refund and, therefore, the same would require to be done manually, if directions to the said effect are issued. He also submits that the same may take about ten weeks. 4. In view of the above, we dispose of the present petition by directing the Revenue to manually process the petitioner’s claim for refund alongwith interest within a period of ten weeks from date. 5. We clarify that the petitioner would also be paid interest in accordance with law, on the footing that the refund had not been adjusted. 6. We also grant liberty to the petitioner to revive the present petition, if the cause so arises.

VIBHU BAKHRU, J

TEJAS KARIA, J MAY 29, 2025/sms

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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 19:42:15

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