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2019 (10) TMI 475 - HC - Income TaxExtension of time for payment of tax to Income Tax Department - Petitioner Goa Cricket Association is affiliated to the Board for Control of Cricket in India (BCCI) and receives funds from the BCCI to carry out its activites which would obviously include paying tax dues under the income tax laws - HELD THAT - Petitioner was incapacitated, for reasons beyond its control and power to make the necessary payments by 07.04.2017. Not only equities, on the principle of law that a person should not be visited with civil consequence nor should be denuded valuable rights which have accrued for no fault of the person concerned, leads us to dispose of the Petition directing that if on behalf of the Petitioner the BCCI tenders by filling up the challan and tenders ₹ 14,03,58,150/- together with interest as contemplated by the tax law for late payment, the said sum would be received by the Respondents to the credit of the Petitioner and would be in satisfaction of the tax payment certificates dated 09.03.2017 for the assement years 2006- 07 till 2012-13. The declaratory order coupled with the mandamus would endure for a period of 180 days from today, meaning thereby the Petitioner has to work it out with BCCI for BCCI to act on behalf of the Petitioner within 180 days. If payment is not transmitted by the BCCI to the Respondents within 180 days from today, the declaration and mandamus issued shall be non-enforceable by the Petitioner.
Issues:
1. Interpretation of the Direct Tax Dispute Resolution Scheme, 2016 regarding the time limit for payment of tax dues. 2. Authority of the Income Tax Department to extend the time for payment under the Scheme. 3. Legal consequences when a taxpayer is unable to make payments within the stipulated time frame. 4. Application of principles of equity and fairness in tax matters. Issue 1: Interpretation of the Direct Tax Dispute Resolution Scheme, 2016 regarding the time limit for payment of tax dues: The judgment involved a case where the Petitioner, a cricket association, received funds from the Board for Control of Cricket in India (BCCI) and was required to pay tax dues under the Direct Tax Dispute Resolution Scheme, 2016. The Income Tax Department issued certificates demanding a substantial sum to be paid by a specified date. However, the Petitioner faced difficulties due to ongoing legal proceedings involving the BCCI, which restricted the flow of funds beyond the payment deadline. The court considered the circumstances and the legal framework of the Scheme to address the issue. Issue 2: Authority of the Income Tax Department to extend the time for payment under the Scheme: The Petitioner sought an extension of time for making the tax payment beyond the deadline set by the Income Tax Department. The Department initially stated that it did not have the power to extend the payment deadline under the Scheme. The court examined whether the tax authorities had discretionary powers to grant such extensions and analyzed the legal provisions governing the Scheme to determine the scope of authority in this regard. Issue 3: Legal consequences when a taxpayer is unable to make payments within the stipulated time frame: In the case, the Petitioner was unable to make the required tax payments within the specified deadline due to circumstances beyond their control, specifically the legal restrictions on fund transfers involving the BCCI. The court considered the implications of non-payment within the deadline and assessed the legal consequences of such inability to comply with the payment terms under the Scheme. Issue 4: Application of principles of equity and fairness in tax matters: The judgment highlighted the importance of equity and fairness in tax matters. The court emphasized that individuals should not suffer adverse consequences or lose valuable rights due to circumstances beyond their control. In this context, the court balanced legal principles with considerations of fairness to provide relief to the Petitioner by allowing an alternative mode of payment through the BCCI within a specified timeframe, ensuring that the tax liabilities were met satisfactorily. Overall, the judgment addressed complex issues related to tax compliance, legal obligations, and the application of equitable principles in resolving disputes arising from the inability to meet tax payment deadlines under the Direct Tax Dispute Resolution Scheme, 2016.
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