2020 (9) TMI 733

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....onferencing. Present writ petition has been filed seeking a direction to the respondents to refund the amount of Rs. 1,21,87,952/- as per intimation dated 16th November, 2019 for assessment year 2018-2019 issued under Section 143(1) of the Income Tax Act, 1961 (hereinafter referred to as 'Act') along with interest. Mr. Salil Kapoor, learned counsel for petitioner submits that despite issuance of scrutiny notice dated 23rd September, 2019 under Section 143(2) of the Act, 1961 in terms of the procedure prescribed under Section 143 of the Act, 1961, the refund due to the petitioner was liable to be released at the time of issuance of the intimation order under Section 143(1) of the Act, 1961. He contends that neither any order has bee....

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....0 due to poor connectivity at his end. It is further settled law that despite issuance of scrutiny notice under Section 143(2) of the Act, 1961, the refund due to the petitioner is liable to be released at the time of issuance of the intimation/order under Section 143(1) of the Act, 1961 unless an order for withholding of refund has been passed under Section 241A of the Act, 1961. In fact, one of us (Mr. Justice Sanjeev Narula) in two recent judgments has held as under:- A) Maple Logistics (P.) Ltd. Vs. Principal Chief Commissioner of Income Tax, 2019 SCC OnLine Del 10961 :- "28. With this backdrop, we now consider the situation at hand. Here the return has been filed on 25.10.2017 for AY 2017-2018 and, therefore, the amended....

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....t the aforesaid provision is not resorted to merely for the reason that the case of the assessee is selected for scrutiny assessment. Sufficient checks and balances have been built in under the said provision and same have to be given due consideration and meaning. An order under section 241A should be transparent and reflect due application of mind. 30. The AO is duty bound to process the refund where the same are determined. He cannot deny the refund in every case where a notice has been issued under Sub-Section (2) of Section 143. The discretion vested with the AO has to be exercised judiciously and is conditioned and channelized. Merely because a scrutiny notice has been issued should not weigh with the AO to withhold the refun....

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...., would obviously be a relevant factor, but that cannot be used to ritualistically deny refunds. The AO is required to apply its mind and evaluate all the relevant factors before deciding the request for refund of tax. Such an exercise cannot be treated to be an empty formality and requires the AO to take into consideration all the relevant factors. The relevant factors, to state a few would be the prima facie view on the grounds for the issuance of notice under section 143(2); the amount of tax liability that the scrutiny assessment may eventually result in vis-a-vis the amount of tax refund due to the assessee; the creditworthiness or financial standing of the assessee, and all factors which address the concern of recovery of revenue in d....