The Delhi High Court granted relief to the Punjab and Sind Bank by allowing the refund of the amount Rs. 1,36,04,250/- deposited by the bank on the ground of involvement of public funds.
Punjab and Sind Bank, the petitioner filed a writ petition against the order passed under Section 201(1)/201(1A) of the Income Tax Act, 1961 concerning the deduction of tax at source, concerning payments made to local authorities, including New Okhla Industrial Development Authority (NOIDA).
Salil Kapoor, Sumit Lalchandani, Ananya Kapoor, Tarun Chanana, and Shivam Yadav, the counsels for the petitioner contended that the public funds are involved, law and justice should meld, and are inclined to quash the order passed under Section 201(1)/201(1A) read with Section 194A of the Income Tax Act.
Further submitted that since public money was involved, and because both the petitioner-bank and the NOIDA fall in the category of entities that deal with public funds, the respondents/revenue could consider repaying the money to the petitioner-bank for onward transmission to NOIDA.
Aseem Chawla, the counsel for the revenue relied on the decisions made by the lower authorities and contended that the order passed under the Income Tax Act was as per the law and liable to be sustained.
The Court observed that public money was involved and both the petitioner-bank and the NOIDA fall in the category of entities that deal with public funds, thus the respondents/revenue could consider repaying the money to the petitioner-bank for onward transmission to NOIDA.
The two-member bench comprising Rajiv Shakdher and J Girish Kathpalia held that the revenue had to refund the amount deposited by the petitioner bank amounting to Rs.1,36,04,250/-.
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