2022 (2) TMI 1062 - HC - Income Tax

Pradhan Mantri Gareeb Kalyan Yojana (PMGKY) scheme - whether petitioner qualifies for the benefits enumerated in section 199-I of Act No. 48 of 2016 granting immunity from the provisions of the Income-tax Act? - amount could not be deposited solely on account of the fact that the first bank that the petitioner went to was not authorised to collect the money and the second bank that the petitioner went to could not accept the money since the banking hours had closed - Can an assessee be denied the benefit of the scheme when there is partial fulfilment of the requirement of the scheme ? - HELD THAT - In the present case, the petitioner-assessee has tried to deposit the amount and in support thereof has produced annexures C and D to the writ petition. Annexure D is the application form in form 2 as required under the Pradhan Mantri Garib Kalyan Deposit Scheme, 2016. If at all the amount had been accepted by the bank, this application and declaration could have been subsequently submitted by the petitioner to the respondent-Department. It is only on account of the bank not accepting the deposit that form 2 could not be got counter signed with an acknowledgment from the bank and not be submitted by the petitioner to the respondent-Department. In the peculiar nature of the facts of the present case, we are of the considered opinion that the petitioner has made all efforts to try and comply with the requirement of the Pradhan Mantri Garib Kalyan Deposit Scheme. In such a situation, 66 per cent. of the compliance having been done, the petitioner ought not to be denied the benefit of the scheme more so that the learned counsel for the petitioner has made a submission that he is still willing to deposit the amount for a period of four years from today and would not claim any interest on the same. Petition stands allowed.

Issues:
1. Eligibility for benefits under the Pradhan Mantri Garib Kalyan Deposit Scheme.
2. Compliance with the scheme requirements, particularly section 199F.
3. Denial of benefits due to non-deposit of a specific amount.
4. Dispute over the petitioner's partial compliance with the scheme.

Analysis:

Issue 1: Eligibility for benefits under the Pradhan Mantri Garib Kalyan Deposit Scheme
The petitioner sought relief to quash a communication denying eligibility under the PMGKY scheme. The scheme allowed for compounding undisclosed income by paying taxes, cess, and penalties. The petitioner faced issues with depositing a specific amount under the scheme, leading to the denial of benefits.

Issue 2: Compliance with the scheme requirements, particularly section 199F
The scheme required depositing 25% of undisclosed income without interest for four years. The petitioner had already fulfilled tax and penalty requirements but faced challenges in depositing the required amount due to bank-related issues. The respondent-authority denied benefits based on non-compliance with this specific provision.

Issue 3: Denial of benefits due to non-deposit of a specific amount
The petitioner's inability to deposit the required sum of ?7.50 lakhs led to the denial of benefits under the scheme. Despite the petitioner's readiness to comply and willingness to deposit the amount, challenges with bank acceptance resulted in non-compliance with section 199F, leading to the denial of benefits.

Issue 4: Dispute over the petitioner's partial compliance with the scheme
The court considered whether partial compliance with the scheme should lead to the denial of benefits. The petitioner had fulfilled a significant portion of the requirements but faced challenges in completing the deposit under section 199F. The court acknowledged the petitioner's efforts and willingness to comply, leading to a decision in favor of the petitioner.

In conclusion, the court allowed the petition, quashed the communication denying benefits, and directed the appropriate authorities to handle the deposited amount as per the scheme's requirements. The decision emphasized the petitioner's substantial compliance and willingness to fulfill the scheme's obligations, leading to a favorable outcome in the case.

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