2016 (2) TMI 1312 - HC - Indian Laws

Seeking adjustment of refund and interest on refund - seeking remission of future tax liabilities on grounds that the petitioner company had incurred loss due to flood and erosion caused by the mighty Brahmaputra river - HELD THAT - Admittedly, the refunds due to the petitioner for the assessment Year 1986-87 to Assessment Year 1992-93 had not been set off against the sum due from the petitioner in respect of the Assessment Year 2013-14. Also, the application made by the petitioner under Section 39A of the Act has not reached its logical conclusion. The requirement of law under Section 39 of the Act is that the Superintendent of Taxes or the Agricultural Income Tax Officer is required to refund to an assessee any sum paid by the assessee in excess of the sum due from the said assessee under the Act. Discretion vests with the assessee to opt for receiving the amount by way of set-off against the sum in respect of any other assessment year. The provision for payment of interest for delay caused in making refund is also provided. As regards the remission under Section 39 A, the State Govt. for the purpose of remitting the whole or part of the amount of the tax, interest or penalty payable in respect of any year by an assessee, the conclusion has to be reached by recoding reasons in writing. In the instant case, the exercise required to be undertaken in adjusting the amount refundable along with interest had not been done, as would be apparent from the Assessment Order itself. The objection raised with regard to the maintainability of the writ petition is not required to be gone into having regard to the facts and circumstances of the case and also having regard to the limited prayer made by the petitioner. This writ petition stands disposed of with direction to the respondent authorities to consider the application of the petitioner made under Section 39A of the Act and also to take such necessary steps towards adjustment of the assessed refund due to the petitioner from the Assessment Year 1986-87 to Assessment Year 1992-93 and to make a fresh assessment in respect of the Assessment Year 2013-14 - Petition disposed off.

Summary

Issues:
1. Maintainability of the writ petition under Section 24 of the Act
2. Refund and adjustment of amounts under the Assam Agricultural Income Tax Act, 1939
3. Consideration of application under Section 39A for remission of tax liabilities
4. Fresh assessment for the Assessment Year 2013-14

Analysis:

Issue 1: Maintainability of the writ petition under Section 24 of the Act
The respondent argues that the writ petition is not maintainable as per Section 24 of the Act, which provides for an appeal against the assessment. It is contended that the High Court should only exercise jurisdiction consistent with the provisions of the Act when a statutory remedy by way of an appeal is available. However, the court decides not to delve into the maintainability issue due to the specific prayer made by the petitioner.

Issue 2: Refund and adjustment of amounts under the Assam Agricultural Income Tax Act, 1939
The petitioner, a Tea Company, claims a substantial refund under the Act, along with interest on the refund for earlier assessment years. The petitioner asserts that the refunds due for certain years were not set off against the current tax liabilities. The court notes that the law mandates the refund of any excess sum paid by the assessee, with the option to set it off against sums due for other assessment years. The court emphasizes the need for proper adjustment of refundable amounts and interest, as demonstrated in previous legal precedents.

Issue 3: Consideration of application under Section 39A for remission of tax liabilities
The petitioner had filed an application under Section 39A seeking remission of tax liabilities due to losses incurred from natural calamities. The court highlights the requirement for the State Government to provide written reasons for remitting tax amounts, emphasizing the need for a logical conclusion to such applications.

Issue 4: Fresh assessment for the Assessment Year 2013-14
The court directs the respondent authorities to consider the petitioner's Section 39A application and take steps to adjust the assessed refunds due for specific years. A fresh assessment for the year in question is ordered, with a directive not to act upon the Notice of Demand until the new assessment is completed. The writ petition is disposed of based on these directions.

In conclusion, the judgment addresses the issues of refund, adjustment, remission, and fresh assessment under the Assam Agricultural Income Tax Act, emphasizing the need for proper consideration of applications and adjustments to ensure fairness and compliance with the law.