Declaration forms cannot be withheld for unassessed tax where returns were filed and renewal remained pending.

Rule 27AA(2)(c) permits withholding declaration forms only where the applicant has defaulted in furnishing returns with receipted challans showing payment of tax due on those returns. The phrase "tax due" was read as tax payable on the basis of the return and the facts existing when the application was made, not unassessed or contingent tax arising from a later assessment or from a pending renewal dispute. A rejected renewal for one period did not justify refusing forms for other periods where renewal applications remained undecided. The authority could not demand payment of unassessed tax before issuing the forms.

---

---

Issues: Whether declaration forms could be withheld under rule 27AA(2)(c) merely because renewal of the eligibility certificate had been rejected and a revision against that rejection was pending, and whether the authority could demand payment of unassessed tax before issuing the forms.

Analysis: Rule 27AA(2)(c) permits withholding of declaration forms only where the applicant has defaulted in furnishing returns together with receipted challans showing payment of tax due according to those returns. The expression "tax due" was construed as the tax payable on the basis of the return and the factual position existing when the application for declaration forms was made, not tax that might become payable after a later assessment or upon final determination of the renewal dispute. The petitioner had filed returns and, until communication of the rejection order, was entitled to proceed on the footing that the renewal application remained pending. The yearly nature of eligibility certificate renewal also meant that rejection for one period could not justify refusal of declaration forms for other periods when renewal applications were still undecided. The authority was therefore not entitled to go behind the returns and insist on payment of unassessed or contingent tax as a condition precedent to issuing declaration forms.

Conclusion: The refusal to issue declaration forms was unlawful and the petitioner was entitled to the forms for the relevant periods.

---