Amnesty Scheme does not Provide for Retention of Refund for Adjustment in Subsequent Year(s): Bombay HC [Read Order]

The High Court of Bombay held that the amnesty scheme does not provide for retention of refund for adjustment in subsequent years.

The petition filed under Article 226 of the Constitution of India contained the following facts. Relief was sought for by the petitioner in respect of a refund entitled to him under the assessment order for the Financial Year 2007-08. However, the same has been denied to the petitioner to which he has brought up the present proceeding.

In 2008-09 and 2009-10, demands raised against the petitioner were disputed as they were to be settled as per an amnesty scheme. As per Settlement Orders dated 16.04.2024 and 18.04.2024, the petitioner deposited INR 9,12,887/- for F.Y. 2008–09 and INR 6,30,633/- for F.Y. 2009-10.

The department sought to adjust the refund of INR 33,29,000/- which was payable to the petitioner for F.Y. 2007-08 in subsequent FYs 2008-09 and 2009-10. The petitioner argued that any retention of the amount of refund entitled to him for 2007-08 would be without authority of law and contrary to provisions ofArticle 265 of the Constitution. The counsel for the petitioner referred to TML Business Services Ltd. v. Deputy Commissioner of Sales Tax and Ors and Andreas Stihl Private Ltd. The Joint Commissioner of State Tax.

The High Court observed that there was no occasion for the department to retain the refund entitled to the petitioner for Tax Period 2007-08 and therefore allowed the petition. The bench, consisting of Justices Aarti Sathe and G. S. Kulkarni, directed the refund amounts to be released within a period of two weeks from the date of the order along with interest as per rules.

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