M/S MICROLAND LIMITED vs. THE DEPUTY COMMISSIONER OF INCOME TAX

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WP/13017/2025HC KarnatakaKAHC01029186202514 August 2025Bench: M.NAGAPRASANNA5 pages
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What did the High Court hold?

The High Court of Karnataka, in its oral order, directed the respondent revenue to consider the rectification applications filed by the petitioner and pass necessary orders in accordance with law within two weeks from the date of receipt of a copy of the order. The Court noted the petitioner's grievance that the revenue had not considered their rectification applications and CPGRAM complaint, and that the revenue's counsel sought time to consider these applications. The Court allowed the writ petition with this observation, effectively directing the revenue to address the petitioner's pending applications for rectification concerning the credit of prepaid taxes and the correct refund for the assessment years in dispute. The specific finding on the merits of the tax credit claim was not reached as the matter was disposed of based on the revenue's undertaking.

What were the facts?

The petitioner, M/s. Microland Limited, filed returns of income for Assessment Years (AY) 2014-15 and 2015-16 on 29.11.2014 and 30.09.2015, respectively. Subsequently, realizing that the original returns did not reflect all prepaid taxes, including those paid outside India, the petitioner filed revised returns on 30.03.2016 and 31.03.2016. Assessment orders were passed accepting these revised returns, but the Deputy Commissioner of Income Tax (DCIT) erred by not granting credit for prepaid taxes paid outside India for AY 2014-15 and showing 'NIL' refund for AY 2015-16. Despite numerous rectification applications and reminders, the revenue did not address the issue. A complaint filed on the Income Tax Portal (CPGRAM) was rejected by the revenue, stating that the original assessment orders were not challenged through appeal.

What were the issues?

1. Whether the Tribunal had to decide on the assessee's claim for credit of prepaid taxes paid outside India for AY 2014-15 and the correct refund for AY 2015-16, as the revenue failed to grant credit and indicated 'NIL' refund respectively, despite revised returns being accepted. Assessee's Contentions: The petitioner argued that the revenue failed to grant credit for prepaid taxes paid outside India for AY 2014-15 and incorrectly showed 'NIL' refund for AY 2015-16, despite accepting the revised returns. The petitioner had filed multiple rectification applications and reminders which were not considered. A CPGRAM complaint was also rejected by the revenue on the grounds that the original assessment orders were not challenged. Revenue's Contentions: The revenue, through its counsel, submitted that the rectification applications filed by the petitioner for the assessment years in question would be considered if two weeks' time was granted by the Court.

Which sections of the Income-tax Act were involved?

Section 244A

AI-generated summary — verify with the full judgment below

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HC-KAR NC: 2025:KHC:31509 WP No. 13017 of 2025

IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 14TH DAY OF AUGUST, 2025 BEFORE THE HON'BLE MR. JUSTICE M.NAGAPRASANNA WRIT PETITION NO. 13017 OF 2025 (T-IT) BETWEEN:

M/S. MICROLAND LIMITED A PUBLIC LIMITED COMPANY NO. 1B, RMZ ECOSPACE BUSINESS PARK OUTER RING ROAD, BELANDUR BENGALURU – 5260 103 REPRESENTED BY ITS DIRECTOR-FINANCE MR. BENJAMIN JOHN ABRAHAM EMAIL ID: benjamin.abraham@micoland.com MOB NO. 9845608293.

…PETITIONER (BY SRI K.R.PRADEEP, ADVOCATE) AND:

1.

THE DEPUTY COMMISSIONER OF INCOME TAX CIRCLE 4(1)(1), BENGALURU BMTC BUILDING, 80 FEET ROAD 6TH BLOCK, KORAMANGALA BENGALURU – 560 095.

2.

THE PRINCIPAL COMMISSIONER OF INCOME TAX, BENGALURU – 2 BMTC BUILDING, 80 FEET ROAD 6TH BLOCK, KORAMANGALA

Digitally signed by NAGAVENI Location: High Court of Karnataka

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HC-KAR NC: 2025:KHC:31509 WP No. 13017 of 2025

BENGALURU – 560 095.

3.

THE PRINCIPAL CHIEF COMMISSIONER OF INCOME TAX, BENGALURU KARNATAKA AND GOA CENTRAL REVENUE BUILDING 1, QUEENS ROAD, SHIVAJINAGAR BENGALURU – 560 001.

…RESPONDENTS (BY SRI SUSHAL TIWARI, ADVOCATE)

THIS W.P. IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO DIRECT THE 1ST RESPONDENT TO PASS THE RECTIFICATION ORDER GIVING CREDIT TO PREPAID TAXES INCLUDING TAXES PAID OUTSIDE INDIA BY THE PETITIONER AND ISSUE THE RESULTANT REFUND AS PER RETURN OF INCOME FILED ON 30.03.2016 AS PER ANNEXURE – A ALONG WITH INTEREST UNDER SECTION 244A OF THE ACT FOR THE ASSESSMENT YEAR 2014-15 WITHIN REASONABLE TIME AS MAY BE PRESCRIBED BY THIS HON’BLE COURT.

THIS PETITION, COMING ON FOR PRELIMINARY HEARING, THIS DAY, ORDER WAS MADE THEREIN AS UNDER:

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HC-KAR NC: 2025:KHC:31509 WP No. 13017 of 2025

CORAM: HON'BLE MR. JUSTICE M.NAGAPRASANNA

ORAL ORDER

The petitioner – assessee is before this Court seeking a direction to respondent No.1 to refund the tax deducted at source including the taxes paid outside the country, for the assessment years 2014-15 and 2015-16. 2. Heard Sri K.R.Pradeep, learned counsel for petitioner and Sri Sushal Tiwari, learned counsel for respondents. 3. The petitioner files returns of income for the assessment years 2014-15 and 2015-16 on 29.11.2014 and 30.09.2015, respectively. Coming to know about the original returns of income as aforesaid did not reflect the entire income taxes paid by the petitioner, which include the income taxes paid in the country and also outside the country, files revised returns of income along with computation of income on 30.03.2016 and 31.03.2016, respectively. 4. The revised returns so filed by the petitioner were subjected to scrutiny and the petitioner furnished all the particulars and details in the proceedings. Respondent No.1 after due consideration of the records submitted by the

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HC-KAR NC: 2025:KHC:31509 WP No. 13017 of 2025

petitioner, assessment orders are passed accepting the revised returns filed by the petitioner and also indicating the amount of refund for the assessment years 2014-15 and 2015-16 but erred in giving credit to the prepaid taxes paid outside India for the assessment year 2014-15 and also indicating ‘NIL’ refund for the assessment year 2015-16. 5. The grievance of the petitioner is that, though he has submitted plethora of rectification applications for the aforesaid assessment years and also reminders, the respondents – revenue has not considered the same. The petitioner has also complained on the Income Tax Portal – CPGRAM and the same is turned down by the respondents – revenue on the score that the earlier orders passed against the petitioner are not challenged by preferring an appeal. It is these orders that has driven the petitioner to this Court in the subject petition. 6. Learned counsel for respondents – revenue would on the issue submit that the rectification applications filed by the petitioner for the aforesaid assessment years would be considered, if two weeks time is granted by this Court.

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HC-KAR NC: 2025:KHC:31509 WP No. 13017 of 2025

7.

In the light of the aforesaid submissions, the respondents – revenue is directed to consider the rectification applications filed by the petitioner and pass necessary orders in accordance with law, within two weeks from the date of receipt of a copy of the order. 8. With the aforesaid observation, writ petition stands allowed. Ordered accordingly.

Sd/- (M.NAGAPRASANNA) JUDGE

NVJ List No.: 1 Sl No.: 19 CT:SS

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