The Delhi High Court ruled that the AO is obliged to refund the amount which becomes payable by an order passed in appeal AO.
The bench said that in cases where a refund becomes due and payable consequent to an order passed in an appeal or other proceedings, the AO is obliged to refund the amount to the assessee without it having to make any claim in that behalf. The reference to Section 239 is thus clearly misconceived. The claim of the petitioner for being accorded credit of the entire TDS as reflected in Form 26AS was thus liable to be accorded recognition along with interest to be computed in accordance with Section 244A of the Act.
The bench viewed that it would be wholly illegal and inequitable for the respondents to give short credit to the tax duly deducted and deposited based on the claim that may be made in a Return of Income.
The bench noted that insofar as the question of rights to live feed being treated as royalty is concerned and other allied issues pertaining to the merits of the dispute stand settled right up to the Court.
The bench relied on Mitsubishi Corporation vs. Commissioner of Income Tax in which the bench observed that the challenge to the Circular of the CBDT does not really merit further consideration. All that need be observed is that once the Tribunal had called upon the AO to examine the issue afresh, the said direction could not have been disregarded by reference to a Circular issue by the CBDT.
Facts
The writ petitioner impugns the order in terms of which the Assessing Officer while giving appeal effect has restricted the benefit of Tax Deducted at Source to INR 24,46,62,305/- being the amount as claimed in the Return of Income. It has proceeded consequently to frame an order of refund of INR 4,92,208/- along with interest under Section 244A of the Income Tax Act, 1961.
The petitioner is aggrieved by the aforesaid action since the AO had failed to take into consideration the total TDS which had been deducted and deposited and the refund thus being computed in light of what had been claimed in the original Return of Income.
Conclusion
The bench directed the respondents to acknowledge the credit of TDS as reflected in Form 26AS of the petitioner amounting to INR 2,27,83,28,430/- and to recompute the total refund at INR 2,03,40,32,090/-.
Case Details
Case Name: ESS Singapore Branch V/S Deputy Commissioner Of Income Tax & Ors.
Citation: W.P.(C) 6589/2024
Coram: Justice Yashwant Varma And Justice Ravinder Dudeja
Court: Delhi High Court
