Refund of TDS cannot be denied for belated e-verification once delay is condoned and tax deduction is undisputed.

Refund of TDS could not be denied merely because e-verification of the return was belated, where the return had been filed in time, the tax deduction was undisputed, and the delay was supported by sufficient cause and later condoned. The ITAT Delhi held that refusal on a purely technical objection was inconsistent with the principle that tax can be retained only by authority of law, and that continued retention in these circumstances would offend Article 265 and result in unjust enrichment. The assessee was therefore entitled to the refund.

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Issues: Whether refund of TDS could be denied merely because the return was e-verified belatedly, despite the delay having been condoned and the tax having been duly deducted at source.

Analysis: The return had been filed within time and the TDS amount was admitted to have been deducted. The delay in e-verification was supported by sufficient cause and was subsequently condoned by the CPC. The denial of refund on a purely technical objection was found inconsistent with the principle that tax can be retained only when authorised by law. Refusal to grant the refund in such circumstances was held to amount to unjust enrichment by the Revenue and to offend Article 265 of the Constitution of India.

Conclusion: Refund could not be denied on the ground of belated e-verification once the delay stood condoned and the tax deduction was undisputed; the assessee was entitled to refund.

Ratio Decidendi: Where tax has been lawfully deducted and the delay in verification of the return is condoned, refund cannot be refused on a purely technical ground, as retention of such tax without authority of law violates Article 265 of the Constitution of India.

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