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TMI Blog2020 (9) TMI 733X X X X Extracts X X X X X X X X Extracts X X X X ..... 2) of the Act, 1961, the refund due to the petitioner is liable to be released at the time of issuance of the intimation/order under Section 143(1) of the Act, 1961 unless an order for withholding of refund has been passed under Section 241A. This Court is of the prima facie opinion that the significance and import of the mentioned judgments have not been appreciated by the AO and the same are being treated as water off a duck‟s back‟. If any order had been passed under Section 241A of the Act, 1961, this Court is of the view that the respondents had sufficient time to produce the same. In response to the petitioner s Grievance Application dated 11th May, 2020 seeking release of refund, the Assessing Officer, Circle 52 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... prescribed under Section 143 of the Act, 1961, the refund due to the petitioner was liable to be released at the time of issuance of the intimation order under Section 143(1) of the Act, 1961. He contends that neither any order has been passed under Section 241A of the Act, 1961 nor any reasons have been communicated for withholding of the refund to the petitioner. He states that upon the petitioner asking for refund, she was repeatedly informed that the same is pending for approval with petitioner s jurisdictional assessing officer and the same would be released by respondent no.2 upon receipt of the said approval. Issue notice. Mr. Sunil Agarwal, learned counsel accepts notice on behalf of respondents. He prays for six wee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... td. Vs. Principal Chief Commissioner of Income Tax, 2019 SCC OnLine Del 10961 :- 28. With this backdrop, we now consider the situation at hand. Here the return has been filed on 25.10.2017 for AY 2017-2018 and, therefore, the amended provisions would be applicable. In our considered opinion, the AO has completely misunderstood the refund mechanism and the import of Section 241A of the Act. The legislative intent is clear and explicit. The processing of return cannot be kept in abeyance, merely because a notice has been issued under section 143(2) of the Act. Post amendment, sub-section (1D) of section 143 is inapplicable to returns furnished for the AY commencing on or after 1st Day of April 2017. The only provision that empowers the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ub-Section (2) of Section 143. The discretion vested with the AO has to be exercised judiciously and is conditioned and channelized. Merely because a scrutiny notice has been issued should not weigh with the AO to withhold the refund. The AO has to apply his mind judiciously and such application of mind has to be found in the reasons which are to be recorded in writing. He must make an objective assessment of all the relevant circumstances that would fall within the realm of adversely affecting the revenue . 31. In the present case, the AO has completely lost sight of the words in the provision to the effect that, the grant of the refund is likely to adversely affect the revenue . The reasons that are relied upon by the Revenue to ju ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ny assessment may eventually result in vis-a-vis the amount of tax refund due to the assessee; the creditworthiness or financial standing of the assessee, and all factors which address the concern of recovery of revenue in doubtful cases. 33. Therefore, merely because a notice has been issued under section 143(2), it is not a sufficient ground to withhold refund under section 241A and the order denying refund on this ground alone would be laconic. Additionally, the reasons which are to be recorded in writing have to also be approved by the Principal Commissioner, or Commissioner, as the case may be and this should be done objectively. (emphasis supplied) B) Ericsson India Private Limited Vs. Additional Commissioner of Incom ..... X X X X Extracts X X X X X X X X Extracts X X X X
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