Madras HC directs Income Tax Department to Refund Excessively Recovered Amount over and above 20% [Read Order]

The Madras High Court directed the Income Tax Department to refund excessively recovered amount over and above 20%.

The writ petition was filed under Article 226 of the Constitution of India, to issue a Writ of Certiorarified Mandamus, to call for the records of the writ petitioner company / assessee on the file of the first respondent, the Principal Commissioner of Income Tax, to quash the impugned order and letter in so far as the implied rejection of the refund request pleaded and consequently direct the respondents to refund forthwith the excessively recovered amount over and above the 20% as prescribed.

The petitioner, M/s.Southern Explosives Company P. Ltd., has suffered an adverse assessment order on 26.03.2015. Aggrieved by the same, the petitioner preferred an appeal on 21.04.2015 before the Commissioner of Income Tax (Appeals), Chennai. It appeared that the petitioner was heard and thereafter the Commissioner of Appeals has called for a remand report on several days. However, no order was passed.

Meanwhile, the case appears to have been transferred to the National Faceless Appeal Centre, New Delhi and it is yet to be renumbered and taken up for hearing by the aforesaid Centre. Meanwhile, the petitioner was entitled to refund of a sum of Rs.28,78,728/- for various assessment years.

The petitioner submitted that maximum amount that can be demanded pending appeal before the Appellate Commissioner is only 20% as per the prevailing circular which would amount to Rs.9,73,728/-. The respondents are directed to refund the excess amount of Rs.19,04,552/- (Rs.28,78,280/- – Rs.9,73,728/-) to the petitioner.

A Single Bench of Justice C Saravanan observed that “This amount shall be refunded to the petitioner by the respondents together with applicable rate of interest, within a period of six weeks from the date of receipt of a copy of this order. The Writ Petition stands disposed of with the above observations.”

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