2021 (4) TMI 1165

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....ent of refund amounts pertaining to Assessment Years ( for short 'AY' ) 2012-13, 2017-18, 2018-19 and 2019-20 against the demand of income tax for the AY 2013-14. It is contended that non-payment of refund to petitioner and its adjustment in recovery of demand for AY 2013-14 is absolutely arbitrary and illegal. 2. Petitioner refers to that income tax return of the petitioner for AY 2013-14 was selected for scrutiny and notices under sections 142(1) and 143(2) of the Income Tax Act, 1961 (The Act / Income Tax Act ) had been issued to petitioner. Order in respect of the same had been passed on 31.03.2016 assessing income at Rs. 21,48,06,900/-. Tax dues were claimed to be to the tune of Rs. 6,13,48,390/-. Demand notice was accordingly issue....

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....s Court. 4. It is being referred to that due to COVID-19 pandemic and lock down, business has been badly affected leading to financial crunch making it difficult for petitioner to arrange for day to day administrative and operative expenses. 5. It is requested that condition in the stay order dated 26.06.2018 be declared void, without jurisdiction and illegal and Petitioner seeks writ of Certiorari to quash the impugned refund orders to the extent that they seek adjustment against demand for AY 2013- 14, and writ prohibiting and restraining recovery by adjustment of refunds against the demand for the AY 2013-14 is sought with a direction to refund of amounts referred to in prayer clauses (e) to (h). 6. Mr. Bhole, learned counsel fo....

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.... a defaulter and refers to Section 220(6) of the Income Tax Act and contends that there is no dispute on that. Thus, petitioner would be entitled to the payment of amount as referred to in the prayer clauses. 7. He refers and relies on a decision of the Punjab and Haryana High Court in the case of Jindal Steel And Power Ltd. Vs. Principal Commissioner of Income Tax And Another, reported in [2017] 391 ITR 42 (P&H). It has been observed in the same, power to adjust refund against the demand is limited and assessing officer is not supposed to act contrary to the instructions by the CBDT. He also refers and relies on decision of this court in the case of M/s. Andrew Telecommunications India Pvt. Ltd. Vs. Principal Commissioner of Income Tax,....

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....ery of outstanding demand. The subsequent office memoranda are partial modifications. 11. To the Affidavit-in-reply, there is a re-joinder by petitioner re-asserting that there is an obligation cast upon assessing officer to grant stay having regard to the Office Memorandum dated 29.02.2016. 12. Mr. Walve, learned counsel for the respondents submits that the Central Government had introduced Centralised Processing of Return of Income Scheme, 2011 (the Scheme ) under Notification dated 04.01.2012 in exercise of the powers under sub-section (1A) of section 143 of the Income Tax Act. He submits that the scheme has been introduced to streamline filing of return and the processing thereof in expeditious manner even allowing the assessee to....

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....tion of scheme pursuant to sub-section 143(1A) of the Act is with a view to process a return expeditiously. Clause 10 of the Scheme, refers to set off of refund arising from the processing of return against tax remaining payable will be done by using details of outstanding demand as uploaded on to the system by assessing officer. 15. Section 143 (1B) of the Act is as under :- "(1B) Save as otherwise expressly provided, for the purpose of giving effect to the scheme made under sub-section (1A), the Central Government may, by notification in the Official Gazette, direct that any of the provisions of this Act relating to processing of returns shall not apply or shall apply with such exceptions, modifications and adaptions as may be....

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....ave to correspond to the provisions and instructions operating. Function under the clause would be circumscribed by them and it would be incongruous to consider that uploading referred to in Clause 10 would mean all refunds arising are liable to be adjusted against the tax demands irrespective of orders thereon by the authorities and / or subsisting instructions and provisions applicable. 19. The tax demand for AY 2013-14 is in dispute and is pending before appellate authority. Having regard to instructions, circulars and memoranda issued from time to time, as referred to on behalf of petitioner, which are not disputed by the respondents, it appears to be expedient that the assessing officer refrains from recovering tax dues demanded for....