WEP PERIPHERALS LIMITED vs. THE DEPUYT COMMISSIONER OF INCOME TAX

PDF · subscribers
WP/15915/2022HC KarnatakaKAHC01036303202206 April 2023Author: B M SHYAM PRASAD3 pages
AI SummaryWithdrawn

What did the High Court hold?

The High Court of Karnataka noted that the refund, along with interest, had been allowed by the respondents. Consequently, the writ petition was rendered infructuous. The Court granted liberty to the Revenue to process the returns in accordance with law, subject to all just exceptions, as regular assessment had not been completed. The Court disposed of the petition with these observations. No specific finding was made on the entitlement to compensation for delay, as the primary relief of refund and interest was granted, making the petition infructuous.

What were the facts?

The petitioner, WEP Peripherals Limited, filed a writ petition before the High Court of Karnataka seeking a direction to the respondents (Deputy Commissioner of Income Tax and Principal Commissioner of Income Tax) to refund a principal amount of Rs. 57,12,572/- along with interest under Section 244A of the Income Tax Act, 1961. The petitioner also sought compensation for the inordinate delay in granting the refund. The Court had previously directed the respondents to comply with the order. Subsequently, both parties' counsels informed the Court that the refund along with interest has been allowed, rendering the petition infructuous. The Revenue sought liberty to process the returns in accordance with law as regular assessment had not been completed.

What were the issues?

1. Whether the petitioner is entitled to a direction for the refund of the principal amount of Rs. 57,12,572/- along with interest under Section 244A of the Income Tax Act, 1961, and compensation for the delay? Assessee's Contentions: The petitioner sought a direction for the refund of the principal amount and interest, and compensation for the financial loss suffered due to the delay in refund, invoking equitable doctrines. Revenue's Contentions: The Revenue did not explicitly contest the entitlement to refund and interest. However, the Revenue sought liberty to process the returns in accordance with law as regular assessment had not been completed, implying that consequential proceedings might arise.

Which sections of the Income-tax Act were involved?

Section 244A

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 6TH DAY OF APRIL, 2023 BEFORE THE HON'BLE MR JUSTICE B M SHYAM PRASAD WRIT PETITION NO. 15915 OF 2022 (T-IT) BETWEEN:

WEP PERIPHERALS LIMITED INCORPORATED UNDER THE COMPANIES ACT 40/1A, BASAPPA COMPLEX LAVELLE ROAD, BANGALORE - 560001 REP BY ITS EXECUTIVE DIRECTOR HEMACHANDRA C S, EXECUTIVE DIRECTOR.

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

1.

THE DEPUYT COMMISSIONER OF INCOME TAX CIRCLE 7(1)(2) BMTC BUILDING 80 FEET ROAD, 6TH BLOCK, KORAMANGALA BANGALORE - 560095.

2.

THE PRINCIPAL COMMISSIONER OF INCOME TAX BENGALURU - 2, BMTC BUILDING, 80 FEET ROAD, 6TH BLOCK, KORAMANGALA, BANGALORE - 560095. …RESPONDENTS (BY SRI.E.I. SANAMATHI., ADVOCATE)

Digitally signed by NARASIMHA MURTHY VANAMALA Location: HIGH COURT OF KARNATAKA

THIS WRIT PETITION IS FILED UNDER ARTICLE 227 OF THE CONSTITUTION OF INDIA PRAYING TO DIRECT THE RESPONDENTS TO REFUND THE PRINCIPAL AMOUNT OF RS.57,12,572/- ALONG WITH INTEREST U/S 244A WHICH AMOUNTS TO RS.55,70,760/- WITHIN REASONABLE TIME AS MAY BE PRESCRIBED BY THIS COURT QUANTIFY AND DIRECT THE RESPONDENTS TO COMPENSATE THE PETITIONER FOR THE INORDINATE DELAY IN GRANTING OF REFUND ON ACCOUNT OF FINANCIAL LOSS SUFFERED BY THE PETITIONER BY ADOPTING THE PRINCIPLE OF EX AEQUO ET BONOR ON SUCH OTHER EQUITABLE DOCTRINE.

THIS PETITION, COMING ON FOR ORDERS, THIS DAY, THE COURT MADE THE FOLLOWING:

ORDER

The petitioner has filed this petition for direction to the respondents to refund the principal amount of Rs.57,12,572/- along with interest as contemplated under Section 244A of the Income Tax Act 1961. This Court on 02.03.2023, while recording the petitioner’s grievance, had called upon Sri.E.I.Sanmathi, the learned standing counsel for the respondents, to communicate this Court’s order for compliance.

It is now stated by Sri K.R.Pradeep and Sri.E.I.Sanmathi, the learned counsels for the parties, that refund is allowed with interest and as such, the petition is rendered infructuous. However, Sri E.I.Sanmathi seeks liberty to the Revenue to process the returns in accordance with law as regular assessment has not been completed. If the petition is rendered infructuous with the refund and there could be consequential proceedings, the Revenue must have liberty but subject to all just exceptions. With these observations, the petition stands disposed of.

Sd/- JUDGE

SA ct:sr

More judgments on Section 244A

All 1,186 judgments and leading authorities on Section 244A →

Recent GST High Court judgments

Search GST case law →