In a recent development, the Delhi High Court has directed the Jurisdictional Assessing Officer (JAO) to render a decision on the pending rectification application filed by the assessee.
The petitioner in the case, Subhash Chander Kathuria, had filed a writ petition concerning the Assessment Year (AY) 2020-21. The matter revolved around the acquisition of land belonging to the petitioner by the National Highways Authority of India (NHAI) under the National Highways Act, 1956.
The petitioner contended that the compensation and interest received from NHAI should not be subjected to income tax. However, NHAI had deducted tax at source on both the principal amount and the interest. While tax at source was deposited for the interest, there was initially an omission regarding the principal amount for the AY in question.
NHAI rectified the mistake by depositing the tax at source for the principal amount, and the revised Form 26-AS reflected the correction. The petitioner had already received Rs. 8,48,84,800/- as the principal amount and Rs. 22,53,517/- as interest.
The petitioner had filed an application with the Jurisdictional Assessing Officer seeking rectification. However, the petitioner’s income tax return for AY 2020-21 had already been processed under Section 143(1) of the Income Tax Act, and a demand of Rs. 2,95,490/- was raised without considering the tax deducted at source on compensation.
The petitioner sought several prayers in the rectification application, including giving credit for the taxes reflected in Form 26AS, rectifying the order dated 15.02.2022, deleting the outstanding demand, and granting a refund of Rs. 90,59,390/-. The earlier rectification application had resulted in the scaling down of the demand to Rs. 16,440/-.
The High Court bench of Justice Rajiv Shakdher and Justice Girish Kathpalia disposed of the writ petition with directions to the Jurisdictional Assessing Officer to decide the pending rectification application at the earliest, but not later than six weeks from the receipt of the judgment.
The court also emphasized that if the decision is adverse to the petitioner, the petitioner can seek an appropriate remedy as per the law.
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