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2013 (11) TMI 578 - HC - Income TaxRefund of tax credit u/s 115JA Recovery proceedings u/s 226(3) - attachment of bank account - assessee sought adjustment of refund u/s 115JA with tax dues and stay of recovery - Held that - Petitioner has not made out a case for refund of tax or for quashing / reading down the provisions of Section 115 JAA and Section 115 JB of the Act - Amount paid by the petitioner as a MAT Company can be adjusted during the period under Section 115 JA. There is no provision under the Act to refund the amount which has been admitted and which has been paid by the petitioner as MAT Company- Decided against the Assessee.
Issues:
1. Tax liability under Section 115 JB of the Income Tax Act for Assessment Year 2007-08. 2. Coercive measures taken by the Income Tax Department. 3. Request for refund and installment payment by the petitioner. 4. Interpretation of provisions of Section 115 JAA and Section 115 JB of the Act. 5. Admissibility of the writ petition and subsequent court order. Analysis: 1. The petitioner, a company engaged in investment, financing, and consultancy, filed its income tax return for Assessment Year 2007-08 on 31.10.2007, admitting a tax liability of Rs.15,69,359 under Section 115 JB of the Income Tax Act. An order passed under Section 143 (1) of the Act on 28.11.2008 created a tax liability of Rs.19,62,491 on the petitioner. The petitioner claimed financial constraints due to a business slowdown but had already made partial payments towards the tax before the order was issued. 2. The Income Tax Department, within two days of the order, attached the petitioner's bank account under Section 226 (3) of the Act. The petitioner sought permission for installment payments, which was not granted. The Department defended its actions stating that the petitioner was in default since 31.10.2007 for failing to pay the admitted tax liability before filing the return in 2007. 3. The petitioner requested the court to quash the attachment order, refund any unadjusted balance, and allow payment of the demanded tax in quarterly installments. However, the court found no grounds for refund or challenging the provisions of Section 115 JAA and Section 115 JB. The court noted that the petitioner had already deposited 50% of the tax as per a previous order and provided security for the remaining amount. 4. The interpretation of Section 115 JAA and Section 115 JB was crucial in determining the admissibility of the petitioner's claims. The Department argued that the tax paid as a Minimum Alternate Tax (MAT) Company could be carried forward and set off in subsequent years as per the Act's provisions. The court concurred, stating that there was no provision for a refund of the tax paid by the petitioner as a MAT Company. 5. The court dismissed the writ petition, emphasizing that the petitioner failed to establish grounds for a refund or challenging the tax provisions. The court highlighted that the petitioner had already complied with a previous order to deposit 50% of the tax and provide security. Failure to deposit the remaining amount would empower the Department to encash the security or take further action under Section 153 of the Act.
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