2015 (3) TMI 984 - HC - Income Tax

Waiver to interest, fine and penalty rejected - petition to condone delay rejected - tax on investment towards purchase of property in Mannargudi out of sale proceeds of gold brought under NRI scheme - petitioner is a non-resident Indian working in Singapore - Held that - Though there is some force in the contention of the learned counsel for the respondent, that sufficient opportunity has been given to the petitioner to pay interest, fine and penalty apart from the tax amount, which is due from 1994 1995. But, the petitioner failed to avail the opportunity given by the authority, in the interest of justice, there will be no harm in giving one more opportunity to the petitioner. Admittedly, the petitioner failed to take effective steps to avail the opportunity given to him. Therefore, remit the matter to the authority for fresh consideration provided the petitioner deposits entire tax amount demanded by the authority.

Summary

Issues:
Petitioner's challenge to proceedings and demand notice by respondents. Failure to consider representations and provide a personal hearing. Request for waiver of interest, fine, and penalty. Opportunity given to petitioner to pay outstanding tax.

Analysis:
The petitioner, a non-resident Indian working in Singapore, filed an income tax return for 1995-96 declaring nil income. The respondents directed the petitioner to explain the investment in property in Mannargudi, which was reportedly made from the sale proceeds of gold under the NRI scheme. Despite explanations, tax was levied in 2002. The petitioner's appeal was dismissed due to delay, not on merits. Subsequent representations and writ petitions were filed, leading to directions for fresh applications for waiver. The impugned order was passed without considering the petitioner's requests, leading to the current writ petition.

The petitioner's counsel argued that the impugned order was illegal as the authorities did not consider the representations or provide a personal hearing. On the other hand, the respondents contended that ample opportunities were given to the petitioner to pay the outstanding tax, interest, fine, and penalty, which the petitioner failed to utilize. The impugned order was passed after considering the petitioner's case as directed by the Court, and thus, no further leniency was warranted.

The judge acknowledged the arguments from both sides but, in the interest of justice, decided to give the petitioner another chance. The judge set aside the impugned order and remitted the matter to the authority for fresh consideration, provided the petitioner deposited the entire tax amount demanded. The petitioner was directed to appear before the authority with objections and documents by a specified date. Failure to comply would result in the restoration of the impugned order. The writ petition was disposed of without costs, with a warning of restoration if the petitioner failed to meet the specified requirements.