TaxTMI 
TaxTMI 
2022 (6) TMI 899
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.... for respondent no.1 waives notice. Mr. Sharma, learned standing counsel for respondent nos.2 to 10 waives notice. 2. By this petition filed under Article 226 of the Constitution of India, the petitioners seek order and directions against respondent no.3 to release the remaining cash amount of Rs.24,29,000/- as shown in the order dated 17.11.2020 passed by respondent no.3. The petitioners also seek order and direction to pay the interest at the rate of 6% p.a. from 03.03.2018 to 23.12.2019 with compensatory interest at the rate of 12% p.a. from 24.12.2019 till 01.12.2020 on the amount of cash released of Rs.14,36,000/- by order dated 17.11.2020 passed by respondent no.3. 3. The petitioners seek an order and direction against respondents to pay interest at the rate of 12% p.a. from 01.11.2017 to 01.12.2020 on cash amount of Rs.9,35,000/- and interest at the rate of 12% p.a. from 01.11.2017 till its final realization of the amount of Rs.24,29,000/-. 4. On 31.10.2017 a search was conducted at the residence of petitioner nos.1 to 4 under Section 132 of the Income Tax Act, 1961 (hereinafter referred to as 'Act, 1961') and amount of Rs.48,00,000/- alongwith gold jewellery were seized ....
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....s, however, cannot deliberately delay the payment of the amount due and payable with interest from the date of the assessment order on the ground that there is no provision for payment of interest after the date of passing of the assessment order. 10. Learned counsel for the petitioners relied upon the chart tendered across the bar showing the amount seized by the respondents, interest payable for the period from 01.03.2018 to 07.12.2020, interest paid from the period 01.03.2018 to 13.12.2019 and the balance amount to be paid by respondents to the petitioner. The petitioners have also shown the interest payable from 01.11.2017 to 31.12.2021 i.e. for a period of 50 months or till the date of actual release of cash. 11. The learned counsel for the petitioners invited our attention to the stand taken by respondents in the affidavit-in-reply and would submit that, in the present case on the basis of the assessment outcome, the Pr. CIT Nagpur vide order dated 17.011.2020 released the seized cash of Rs.23,71,000/-. However, in respect of the M/s. Harshit S. Kabra (HUF) and M/s. Lashika Motors, the proceedings have been initiated under Section 147 of the Act, 1961 for reopening of the a....
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....se of Ajay Gupta Vs. Commissioner of Income Tax reported in Laws (DLH)-2007-4-62 and would submit that, Delhi High Court has awarded claim for interest in view of the delay on the part of the revenue to pay cash amounts seized after the date of assessment order till the payment was released after considering the provision of Section 132-B (4) (b) of the Act, 1961. 17. Learned counsel for the petitioners placed reliance on the judgment of the Delhi High Court in a case of G. L. Jain Vs. Commissioner of Income Tax - XI & Ors. delivered on 28.08.2012 in Writ Petition (C) No.876/2012 and in particular paragraph no.10. He submits that, after construing the provision of Section 132-B(4) and after adverting to the judgment of the Hon'ble Supreme Court in a case of Sandvik Asia Ltd. Vs. Commissioner of Income Tax-1, Pune reported in ITR- 2006-280-643 Delhi High Court has held that, absence of an express provision does not absolve the liability; it only reinforces the restitutionary principle which Courts under Article 226 of the Constitution of India are bound to enforce. The Delhi High Court accordingly directed the revenue to pay interest at the rate of 12% p.a. on the balance amount pa....
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....e. If the words used are capable of one construction only then it would not be open to the Courts to adopt any other hypothetical construction on the ground that such construction is more consistent with the alleged object and policy of the Act. In applying rule of plain meaning any hardship and inconvenience cannot be the basis to alter the meaning to the language employed by the legislation. This is especially so in fiscal statutes and penal statutes. 22. It is submitted that, the petitioners cannot be awarded payment of interest or compensation amount from the date of assessment order on the ground of hardship or inconvenience alleged to have been suffered by the petitioners. He placed reliance on the judgment of the Hon'ble Supreme Court of India in a case of Ramnath and Co. Vs. Commissioner of Income Tax reported in Laws(SC)-2020-6-32 and would submit that, the Hon'ble Supreme Court has taken the similar view while interpreting Section 80-O, Explanation (iii) of the Act, 1961. 23. The learned counsel for the revenue sought to distinguish the judgment relied by the petitioners on the ground that, the facts before the Delhi High Court and before the Hon'ble Supreme Court of In....
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.... clause (i) of sub-section (1) of this section. (b) Such interest shall run from the date immediately following the expiry of the period of one hundred and twenty days from the date on which the last of the authorisations for search under section 132 or requisition under section 132A was executed to the date of completion of the assessment under Section 153A or under Chapter XIV-B. REASONS AND CONCLUSIONS 28. It is not in dispute in this case that, the search at the residence of the petitioner nos.1 to 4 was conducted by the respondents on 31.10.2017 and amount of Rs.48,00,000/- alongwith gold Jwellary were seized. The last authorization of a search was done on 01.11.2017. The petitioners applied for release of the assets on 29.11.2017 as per proviso to Section 132(B)(1)(i) of the Act, 1961. Assessing Officer passed assessment order under Section 143(3) of the Act, 1961 in the case of petitioner nos.1 to 4 and 10 vide assessment order dated 23.12.2019 and 26.12.2019 and assessed the income as Rs.nil. The petitioners accordingly applied for release of the seized cash of Rs.48,00,000/- by various letters during the period between 07.02.2020 to 03.09.2020. 29. Admittedly, the res....
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.... argued and in any event if the revenue takes an erroneous view of the law, that cannot mean that the withholding of monies is 'justifiable' or 'not wrongful'. 34. The Hon'ble Supreme Court considered the issue that, this Act provided for payment of compensation for delayed payment of amounts due to an assessee in a case where these amounts include interest? It is held that, the Act recognizes the principle that a person should only be taxed in accordance with law and hence where excess amounts of tax are collected from an assessee or any amounts are wrongfully withheld from an assessee without authority of law the revenue must compensate the assessee. The Hon'ble Supreme Court in that matter directed the revenue to pay interest at the rate of 9% p.a. from the date it became payable till the date it was actually paid holding the revenue solely responsible for the delayed payment. 35. Mr. Sharma, learned counsel for the revenue strongly relied upon the observations made by the Hon'ble Supreme Court in paragraph no.26 of the said judgment and would submit that, the award of interest on the refunded amount is as per the statutory provisions of law. When a specific pr....
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....id judgment also would apply to the facts of this case. We are in respectful agreement with the view expressed by the Delhi High Court in a case of G. L. Jain Vs. Commissioner of Income Tax - XI & Ors. (supra). 39. In so far as judgment of the Hon'ble Supreme court in a case of Commissioner of Customs (Import) Vs. M/s. Dilip Kumar and Company and Ors. (supra) relied upon by the learned counsel for the revenue is concerned, the Hon'ble Supreme Court in the said judgment had considered the question as to what interpretative rule to be applied while interpreting a tax exemption provision/notification when there is an ambiguity as to its applicability with reference to the entitlement of the assessee or the rate of tax to be applied. In paragraph no.19 of the said judgment it is held by the Hon'ble Supreme Court that, when the words in statute are clear, plain and unambiguous and only one meaning can be inferred, the Courts are bound to give effect to the said meaning irrespective of consequences. If the words in the statute are plain and unambiguous, it becomes necessary to expound those words in their natural and ordinary sense. 40. In this case, it is not the case of interpretatio....