TaxTMI 
TaxTMI 
2015 (2) TMI 453
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....ed 3.7.2007 and this Court, for the reasons recorded in the order, more particularly based on the decision of the Apex Court in the case of Sandvik Asia Limited Vs. Commissioner of Income Tax & Others, reported in (2006) 280 ITR 643 (SC), had issued the following directions:- "10. It may be mentioned that the above quoted instruction has been issued on the basis of the judgment of the Supreme Court in Sandvik Asia Ltd. (supra). Thus, this Court is of the opinion that the petitioner would be entitled to compensation by way of interest for the delay in payment of amounts lawfully due which were withheld wrongly and contrary to law. The net result of the above discussion is that the petition will have to be accepted. 11. For the foregoing reasons, the petition succeeds. The three orders namely; (1) the order dated October 6, 1992 passed by the Commissioner of Income Tax, Baroda, declining to accept the claim of the petitioner for interest on refund on the ground that it is not admissible under Sections 243(1)(b), 244(1A) and 214(2) of the Act, produced at Annexure-N; (2) the order dated January 18, 1993 passed by the Chief Commissioner of Income Tax, Gujarat, Ahmedabad, refusing....
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.... the High Court and remand the matter back to the High Court for reconsideration of the writ petition filed by the respondent herein before the High Court keeping in view the observations made by this Court in Commissioner of Income Tax, Gujarat vs. Gujarat Fluoro Chemicals, decided on 18.9.2013. 16. The Civil Appeal is disposed of accordingly. 17. All the contentions of both the parties are kept open. We request the High Court to dispose of the writ petition as expeditiously as possible. Ordered accordingly." 5. The aforesaid shows that the Apex Court directed the matter to this Court for reconsideration, keeping in view the observations made by the Apex Court in the case of Commissioner of Income Tax, Gujarat Vs. Gujarat Fluoro Chemicals (supra) and the Apex Court further has made the observations for early disposal of the matter. Under these circumstances, the present matter is listed before us. 6. We have heard Mr.Karia, learned Counsel for Mr.R.K. Patel, learned Counsel for the petitioner and Mr.Manish Bhatt, learned Sr. Counsel for the respondents. 7. It was submitted by the learned Counsel for the petitioner that the subsequent decision of the Apex Court in the c....
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....the assessee ought to have been compensated for the inordinate delay in receiving monies properly due to it? Learned counsel for the appellant says that it cannot be denied that it has been deprived of the use of it's monies for periods ranging from 12 to 17 years. It also cannot be denied that such deprivation is solely due to the actions of the revenue which have been held by this Court to be contrary to the provisions of the Act, on general principles it ought to be compensated for such deprivation. In the impugned order, the Bombay High Court has held that no compensation is required to be paid since" ... there was a serious dispute between the parties, which was ultimately ordered to be paid pursuant to the order passed by this Court on 30.04.1997. Undisputedly, the amount pursuant thereto was paid on 27.03.1998. ..." The Court further held that since the amount was paid once the controversy was resolved there was no wrongful retention of monies. No authority can ever accept an obligation to make payment and simply refuse to pay. In each and every case an authority must at least claim to act in accordance with law and hence claim it has no obligation to pay for some ....
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.... 3. In order to attain uniformity and to regulate such refunds it is clarified that refund applications under Section 11B(1) of the Central Excise Act, 1944 or under Section 27(1) of the Customs Act, 1962 need not be insisted upon. A simple letter from the person who has made such deposit, requesting the return of the amount, along with an attested Xerox copy of the orderinappeal or CEGAT order consequent to which the deposit made becomes returnable and an attested Xerox copy of the Challan in Form TR6 evidencing the payment of the amount of such deposit, addressed to the concerned Assistant/Deputy Commissioner of Central Excise or Customs, as the case may be, will suffice for the purpose. All pending refund applications already made under the relevant provisions of the Indirect Tax Enactments for return of such deposits and which are pending with the authorities will also be treated as simple letters asking for return of the deposits, and will be processed as such. Similarly, bank guarantees executed in lieu of cash deposits shall also be returned. 4. The above instructions may be brought to the notice of the field formations with a request to comply with the directions and ....
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....nt on 27.03.1981 and 30.04.1986 due to the erroneous view that had been taken by the officials of the respondents. Interest on refund was granted to the appellant after a substantial lapse of time and hence it should be entitled to compensation for this period of delay. The High Court has failed to appreciate that while charging interest from the assesses, the Department first adjusts the amount paid towards interest so that the principle amount of tax payable remain outstanding and they are entitled to charge interest till the entire outstanding is paid. But when it comes to granting of interest on refund of taxes, the refunds are first adjusted towards the taxes and then the balance towards interest. Hence as per the stand that the Department takes they are liable to pay interest only upto the date of refund of tax while they take the benefit of assesses funds by delaying the payment of interest on refunds without incurring any further liability to pay interest. This stand taken by the respondents is discriminatory in nature and thereby causing great prejudice to the lakhs and lakhs of assesses. Very large number of assesses are adversely affected inasmuch as the Income Tax Depar....
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....efund, if provided by the statute, such would govern the field, but the Court has to take all relevant factors into consideration while awarding rate of interest on compensation. 13. In the latter decision of the Larger Bench of the Apex Court in the case of Commissioner of Income Tax, Gujarat Vs. Gujarat Fluoro Chemicals (supra) at paragraphs 5, 6, and 7, it was observed and held as under:- 5. Since there was an inordinate delay on the part of the Revenue in refunding the amount due to the assessee this court had thought it fit that the assessee should be properly and adequately compensated and, therefore, in paragraph 51 of the judgement, the court while compensating the assessee had directed the Revenue to pay a compensation by way of interest for two periods, namely; for the assessment years 197778, 197879, 198182, 198283 in a sum of Rs. 40,84,906 and interest at 9 per cent from March 31, 1986, to March 27, 1998, and in default, to pay the penal interest at 15 per cent, per annum for the aforesaid period. 6. In our considered view, the aforesaid judgment has been misquoted and misinterpreted by the assessees and also by the Revenue. They are of the view that in Sandvik....