2023 (8) TMI 1426 - HC - Income Tax

Refund seeked of excessively recovered amount over and above 20% - case appears to have been transferred to the National Faceless Appeal Centre, New Delhi - HELD THAT - As petitioner submits that maximum amount that can be demanded pending appeal before the Appellate Commissioner is only 20% as per the prevailing circular which would amount to Rs.9,73,728/-. However, vide impugned communication dated 11.01.2022, the respondents have stated as follows I am directed to communicate that the Principal Commissioner of Income Tax-3, Chennai has considered your petition for grant of stay of collection of demand since CPC has collected more than 20% of demand by way of refund adjustment. Accordingly, the PCIT-3, Chennai has stayed further collection till the disposal of Appeal by the CIT(A). In view of the above stand of the respondents in the counter, the respondents are directed to refund the excess amount of Rs.19,04,552/- (Rs.28,78,280/- - Rs.9,73,728/-) to the petitioner together with applicable rate of interest, within a period of six weeks from the date of receipt of a copy of this order.

Summary

Issues:
The petitioner challenged the impugned proceedings to quash and direct the refund of excessively recovered amount over 20%.

Adverse Assessment Order:
The petitioner received an adverse assessment order on 26.03.2015 and appealed on 21.04.2015 before the Commissioner of Income Tax (Appeals), Chennai, numbered as ITA No.184/CIT(A)-15/2015-16.

Delay in Passing Order:
Despite being heard, no order was passed in ITA.No.184/CIT(A)-15/2015-16, and the case was transferred to the National Faceless Appeal Centre, New Delhi, pending renumbering and hearing.

Refund Adjustment:
The petitioner was entitled to a refund of Rs.28,78,728/- for various assessment years, adjusted on different dates. The petitioner contended that only 20% of the demand could be collected pending appeal, amounting to Rs.9,73,728/-.

Respondents' Communication:
The respondents stated in a communication dated 11.01.2022 that the Principal Commissioner of Income Tax-3, Chennai stayed further collection due to CPC collecting more than 20% of the demand through refund adjustment.

Court's Decision:
The court directed the respondents to refund the excess amount of Rs.19,04,552/- to the petitioner and instructed the refund, along with applicable interest, within six weeks. The Writ Petition was disposed of with no costs incurred.