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Court awards interest on advance tax refund despite Act repeal The court awarded a lump sum amount of Rs. 50,000 as interest to the petitioner who had deposited an amount towards advance tax under a repealed Act. The ...
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Court awards interest on advance tax refund despite Act repeal
The court awarded a lump sum amount of Rs. 50,000 as interest to the petitioner who had deposited an amount towards advance tax under a repealed Act. The court emphasized the significance of timely legal action and concluded that the petitioner was entitled to interest despite the repeal of the Act. The Department was directed to make the payment within six months from the date of the judgment.
Issues: Entitlement to interest on deposited amount under repealed Act.
In this case, the petitioner filed a writ application seeking to quash an order rejecting their prayer for interest on an amount deposited towards advance tax under the repealed Bihar Agricultural Income-tax Act. The petitioner claimed the deposit was made on oral direction from the Department and thus, they were entitled to interest. The State argued that as there was no demand for advance tax and the amount was voluntarily deposited by the petitioner, no interest was due. The main issue for consideration was whether the petitioner was entitled to interest on the amount that remained with the State Government.
The court noted that the amount was deposited after the Act was repealed, and therefore, the deposit was not made under the provisions of the Act. While the Act provided for interest on refunds, the petitioner did not approach the court promptly for a refund. Considering the delay in seeking a refund and to bring the matter to an end, the court decided to award a lump sum amount of Rs. 50,000 as interest to the petitioner. The court directed the Department to make this payment within six months from the date of the judgment.
Overall, the judgment addressed the issue of entitlement to interest on a deposited amount under a repealed Act. It highlighted the importance of timely legal action and balanced the interests of the petitioner with the need to conclude the matter efficiently.
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