The Delhi High Court has directed the Commissioner of Income Tax to examine the claims and grant refunds to Ericsson.
The Court also held that the entire amount, with the approval of the Principal Commissioner of Income Tax to the withholding of the refund amount, should be completed within the period of six weeks and the case of failure the respondents shall transmit the amount including the interest to the petitioner without awaiting any further orders.
The petitioner namely Ericsson India Private Ltd., in this case, is a company engaged in the business of trading, manufacturing or assembly of telecommunication carrier equipment for sale to independent customers, providing implementation, commissioning and support services related to telecommunication systems. The petitioner is regularly assessed for tax. The petitioner company filed a petition to seek directions to the revenue for a refund of a certain amount which is said to be lying with the Department in respect of Assessment Year (AY) 2017-18; 2016-17 and 2018-19.
The issue raised in this case was whether the Commissioner of Income Tax is empowered to keep the refunds for a long period of time or not?
The division bench comprising of Justice Sanjeev Narula and Justice Vipin Sanghi held that the entire amount, with the approval of the Principal Commissioner of Income Tax to the withholding of the refund amount, should be completed within the period of six weeks and the case of failure the respondents shall transmit the amount including the interest to the petitioner without awaiting any further orders.
The court also left an option with the petitioner to take remedial steps in respect of any orders for withholding of refunds that may be passed.
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