2013 (12) TMI 1205 - HC - Income Tax

Petition for payment of demand in instalments - Held that - The petitioner s claim to grant credit for TDS of the Assessment Years 2012-13 and 2013-14 cannot be accepted - The petitioner is facing serious financial hardship - It would be appropriate to permit the petitioner to clear the entire outstanding amounts in three monthly instalments - Decided in favour of petitioner.

Summary

Issues:
1. Exemption claim under Section 11 of the Income Tax Act, 1961.
2. Demand for Assessment Years 2008-09, 2009-10, and 2010-11.
3. Request for payment in instalments.
4. Adjusting TDS amounts towards outstanding demand.
5. Financial hardship of the petitioner.

Exemption Claim under Section 11:
The petitioner filed a return for the Assessment Year 2010-11, seeking exemption under Section 11 of the Income Tax Act, 1961. The assessment resulted in a tax payable of Rs.13,93,37,520/- and interest of Rs.3,68,83,460/- under Section 234B of the Act.

Demand for Assessment Years 2008-09, 2009-10, and 2010-11:
The petitioner had outstanding amounts due for the Assessment Years 2008-09 and 2009-10. A payment schedule was granted allowing instalments, but a request for exemption for the remaining amount for August 2013 was denied. Despite payments made, the respondent directed the petitioner to clear the entire demand for all years by a specified date, leading to the filing of the writ petition.

Request for Payment in Instalments:
The petitioner, through senior counsel, argued for the permission to pay the outstanding amount in monthly instalments of Rs.1 Crore each. However, the court found no merit in granting credit for TDS amounts of subsequent years or allowing instalments at the requested rate.

Adjusting TDS Amounts towards Outstanding Demand:
The petitioner contended that TDS amounts from subsequent years could be adjusted towards the demand for the Assessment Year 2010-11, reducing the balance payable. The respondent, in the counter-affidavit, refuted this claim, stating that TDS amounts cannot be adjusted towards arrears of demand for a different assessment year.

Financial Hardship of the Petitioner:
Considering the serious financial hardship faced by the petitioner, the court decided to allow the clearance of outstanding amounts in three monthly instalments. The petitioner was directed to pay Rs.2 Crores by 31.10.2013, another Rs.2 Crores by 30.11.2013, and the remaining balance by 31.12.2013. The writ petition was disposed of accordingly, with no costs imposed.

This detailed analysis of the judgment from the Andhra Pradesh High Court covers the issues related to exemption claims, outstanding demands, payment schedules, TDS adjustments, and financial hardships faced by the petitioner, providing a comprehensive understanding of the legal proceedings and decisions made by the court.