Taxpayer Cannot Be Left At Mercy Of Assessing Officer Who Chooses To Delay Payment Of Genuine Refunds: Allahabad High Court
While dealing with a writ petition for refund of Tax Deducted at Source (TDS), the Allahabad High Court has held that when the documents for TDS are provided by the assesee, the Assessing Officer must process the refund and cannot delay payment of refund in genuine cases. The bench of Justice Shekhar B. Saraf and Justice Prashant Kumar held “a taxpayer should not be left at...
While dealing with a writ petition for refund of Tax Deducted at Source (TDS), the Allahabad High Court has held that when the documents for TDS are provided by the assesee, the Assessing Officer must process the refund and cannot delay payment of refund in genuine cases.
The bench of Justice Shekhar B. Saraf and Justice Prashant Kumar held
“a taxpayer should not be left at the mercy of an Assessing Officer who chooses to delay the payment of genuine refunds. Furthermore, as long as the assessee is able to provide documents proving that tax has been deducted at source, the same has to be accepted by the Assessing Officer, who cannot insist that the amount match the figures in Form 26AS. It is the responsibility of the Assessing Officer to verify the amounts provided by the assessee through the proof of Form 16A.”
Petitioner pleaded that even though the it was eligible for refund of the tax deducted at source as it is a Cooperative Society exempt under Section 80P of the Income Tax Act, 1961, the application was not being processed by the department. It was pleaded that the despite serval applications, the department was not issuing the refund due to alleged mismatch with Form 26AS.
The Court observed that the Delhi High Court in Court on Its Motion vs. Commissioner of Income Tax had held that Assessing Officers have been given sufficient statutory powers and the assesee cannot be left at the mercy of the authority. It held that it is the Revenue's job to verify the transaction and details of the TDS once the assesee has approached him with details. It is the Department who will have to inquire from the deductor regarding the payment, etc.
Further, in Rakesh Kumar Gupta vs. Union of India and Another, the Allahabad High Court had held that mismatch between TDS claim and Form 26AS is the fault of the deductor and not the assesee seeking refund of TDS. The Court also found the claim for interest on refund maintainable as the delay in processing it was attributable solely to the Income Tax Department.
Accordingly, the Court held that the petitioner was liable to receive the refund.
Case Title: U.P. Rajya Nirman Sahakari Sangh Limited Versus Union Of India Min.Of Finance Dept.Of Revenue Thru.Secy.Andors [WRIT - C No. - 16125 of 2018]