Sri G Girisha Prabhu vs The Assistant Commissioner Of Income ... on 7 June, 2010

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Karnataka High Court

Sri G Girisha Prabhu vs The Assistant Commissioner Of Income ... on 7 June, 2010

Bench: Anand Byrareddy

IN 'ZITE HIGE COURT OF KARNATSIQA AT 

DATEE THIS mag V" nay 0? JUNE 2o1o <f;fg

BE FORE

mam HDN*BLE HR.J8STICE Auann BE§§3#§D§' V"  

WP.No.B654f$61Q(T#IT}V : ;""
BETWEEN: "' " T'

Sri.G.Giri3ha Prahhﬁ, - 1_,, 4,, 2
Sfc.Gu:upux Pundalik ?:ahhug >."'
Aged about 45 Yaara;""'" "af, -,»
Raaiaing at_Rb;1iB8; Kathyayahi,;

7"" 'A'  442$, _-f§!ro§§g'  fjﬁxssycsut,

3?" §h&$%;1:B§ 5t&§€; Lx¥*m>   *

Bangalcra ~ 560 929,X_' --M,; pmwxrxcwsn

{By 5151 -V_I<aé.gIf:ui:~;azﬁ;e&:, Advcscatei

.--44-.---n--

         

 T'Psaa":i;g7t»ea£:::1$"{3orzuais3ioner ::>f Inccmia Tax,

c1:a;a'1¢¢1y;*59 HT Bhavan,

{By 131:i..I-!.'s?.Seahachala, Adzvsctaata)

 V. V  'fI'iI$ WRIT ?E'I'ITION IS FILE}? UNDER

"'iT"%11.. fhRu?IcLEs 226 AND 227 or ms: ~2ﬁ{>iN$'I'ZE'I'{I'I'IC3I*3' 05
-,_ .fxNnIA pxaxxua TO DIRECT THE asspcunsur T
'» {GRANT xnwmamsm an azruan AMDUNT uunna szcrxon

2443 GE TEE XNCOHE TAX ACT, 3361 FOR 'I'HE
A$3ESS1% YEAR 1.999-"2800. TI-E IEIFHGNED
REFUND GREEK GIVING EFFECT TD TIE 0R.33ER OF THE
CCRQESSIGKER OE' ENCORE TAX; BANGALORE V;

%



m-.e3.11.2oos, snamms mmrm 
mrnnssm -:1-reason FOR arm: asszsszmms m.m2.%:'i9%9L9§%V._T ~

00 ENCLQSED IN AHNEXURE-'A ETC",

ms writ petition  céiﬁizﬁg .: 
preliminary hearing in 'B' Grot1pA.'thi$";r'§a%.y, . 1.:'z;éf_:

Court passed the fcllcrwing:-  

ca.nE':£s.. 

 

S1:i.I'i.V..Saaha<:ha§.a.,_r' mJ;$--:é§.fz¥ed cﬁiiizéyel i3

directed ta take notic§§_  r;e.f:$';:n¢:x§;1_£ant.

2.   is fQ'h.'ea.§:'éi; and cliapcaed
of at fthg   hearing as it
arise57,_  and circumstancas

as in a ci=*=.:_c::i.aiV'<';:n r.a':t'.'»--  C¢urt rendered in the

 case._;f§s':: Asaranm cﬁsi

 cums 14(1), mammu

7112909; 135 mama so mm. ; 1 .

2'~{§.i)':. The f&<.'.'3t$ briefly stated arm-

'The petiticnez: is an individual amﬁ an

j  V' éngﬁlayaa cf M! s . Infoays Teclmol ogia-5

"Limited{hez:einafter raferred to as "Compa.ny"'

for brevity). The petitisner was granted

3



stock optiona under the emplzsyee 

sehema framed by the Cacxgany. The

hearing exercised his ogfﬁiﬁﬁ'  

aamassment year 1999-17.-'£_<J0£}.V.4"--. "t=he _S.Le1.z':rzv§' V¢4ré."a= 

tr-aatad as a pergnisi'?: § '»  
Ccmaiasioner emf   under
Secizierm 231 passscra  the
Grantpany.    detemained
thereof dLi.§§   'His recovered as
Tax    the amplcryeas
pursuazit "t".::::V .-'passed by the Deputy

Coamiwaaioxiépvw taf A"v1E:Vci?:i;*c:me~Taz-c. The azmunt

ad; ~§::em t'It:'é Ccmpany was accordingly

 Ecsrm Nmlﬁ had been issued tea

the  by the said Gczmpany. The

 "«., 'p.etitiz:;:ﬁx£2: has paid the following sums by way

   deduction as per the fellowing tablew-

  f  wax mmmsm TOTAL

Ra. R3. R5

 "=._ 'A.Y.1.999-cm 3,o4,2ooz- 39,971 3,44,2.'.r1¢--

3



is no taxable pexquisitze arising on 

vesting of stock optians. The 

therefore, bemame entitled ﬁt'.-'<3 ﬁéiﬁuﬁd. 

pexquiaite wrongly de<i»1u:_:tec:i4"-.};$°j,<. thtaf.

Thus Assistant (:o:ctnia=$i»:>'i'i@.:£* of. ':znV'::';'z:,.-g¥;;a~4?:tt§a.:a.?V¥-Tbs
while giving eff¢3}:~*;_   the
Tribunal by an xardaaé  far the
asseaasment:   "%rAA:5; €1'£s~»...I§Té$.'PsCIT('I'}35).'C-~
16(2) 02-s'::§  *'15,.e;.$ stated that
the     to the Central
G;svar:11¥éer§'t«'. V._2seV_:Aﬁ£.4f9ata& as payment at tax

en behalf  the ::3e.?.*'a <:n from whose income the

 «:ied'¢;§i:i,_¢:1 was ;V '1'his czrdar waa challenged

 while alsm filing an

 'izaeeking cendczmation of delay in

Vvtixa Jcafurxﬁ wplicmtion dated 28.1.2003

  "ﬁjefgifgt the Cotzmiasiuner of Insane-Tax. In the

 the; aqapaal filed by the department;

 uwagainat the order cf the Tribunal wag

d:i.smis$ad by this Court: by its aztder dated

15.12.2006

tzpholciing the carzcluaiona and 5 findings sf the Tribunal, which is the case oz: mmsum at mwxs 235% ii, Illfllii.) 1. This <3ouJ.ft_ heiwcl that 1 fefijﬁiti *' applications are peneiinﬁg was liable ta settle vijffiae <:£,'f'.%_:i'V;:,fV;Vz 4._V'.§;'-v.'uiVf:'~«..t;11.-.;.=--Vyéa-iflieart. Thar Department, a further appeal to ":.';'ag.a;§_Az1'st the order cf this Qigsﬁissad and carder of 'ith-1'_.'§ by an c:-rdm: dated 4.1.2653," «véniV§;1§j1jV~is'-.V.:¢:_§;»§'g;arted in 2.97 rm 1&7 sc:tc &.9.§§;£a, r;1:sT- éz' '"m.7m«-sax Am. zrmars

-an; """ ), The psatitieenm: filed an refund of the tax hefara the 're'ap£§§nden'f::§g. cm 3.5.3.2E}0'?. The 'conzmiaaicner ""-.«.._'V?.:1:.¢re1i;s c$§._z passed an order: under: Section (bi dated lE}.'?.2008 caandcming the delay filing the revised rsturn and ciirectad the ."a3aessing Qfficex: tr': process the return of incmms in acccrrdazace with law. Tim reapezandent passed refund Q.'Cd&.t giving effect ta the cards: 5

of thas Cormiasioner of xnczome-Tax, V, computing tha reianclahler intereat therecm for thefi a»$:_: }a*n-3~jva '3;11é;3;t_.:

1999-eo on 3.3.1.2003. 2:: :i'.'3 'thia;,'v~"..té}ii¢h'*3 am-.1ght ta be challenged.""'*».: "'

3. While abcrve sequence at 4sv9nt$;"""'t§:§3V_:' fer the the izwugned order i:;jn%_A<:i>;..*F?{a;'3:;'V«1.:;;g;aL§ to refusal <>f gxant -_ 'th'a" refund is apposed to the $XP'1l""ET}59 _ of 2:145:31) Ca} . The _ lea::j;é&.?A.couri:s9iV wcfauld draw attention true the the Sectien, whish reads as '~ .. "iﬁhera the Jzrefund sm out of '~ any tax paid under Sectitm 115365 ":3: aallactad at ~.;-scsurve under:

Sec-ticm 2066 car paid by way of advance tax :3: treated as: paid uncles: Section. 199, during the finamtial year immediately preceding the assassment year, such intexaat shall be calaxulateci at the rate of 0119- half per cent for every menth <31:

part of a month cozmrised in the 3 pezriod fxzcrru the 1" day of of the aaseaament yeaz: ta tine % date on whiah tbs ref11xx;i__._"i.s'--..T."' Qrantec:-1:

Prtbvided that shall be payable % if the. amcv.-in;t of xrefund is leTa;a""-...t:hazi' Vter_z'pe'2:_ '" cent: of the tax dat'e.rrﬁ:;'..:ied':: under Sub-S__m::tiar:.§.:L)'v.._e£ Se¢:t..1'.¢n.' 3,155 RE 02.5"~.'_suI'§-se¢:ti.¢'n.(1} of Section 143* * .a::»;:J 1 oizff ..,;:'-agtgular a.$s$sament::"" " X 1

4. ﬁrzse wcsuld submit that ._{: hé«..p§:§t»3Ltic>ner 31$ out of tax tﬁgatéedvv£u:§:'v-.,:$¢:;i;d.T:::é1:x:i-9": Section 3.99 of the Am: as is _ " a raading of the pras;r.:?j:'Sien$ the petitioner: is entitled The case af the; petitioner: is £izmf'T..._;:a9é*c=}Vi:a._£*Ti;;'15$' the pxtovise to the aforesaid V . claﬁée "-iﬁaﬁmuch as the ammunt of refund is mat 16% of tax déterminecl urxdsr Sedation .' :31: on regulaz: asaezaament. The counsel ' .. ux'aé'<:$i13.d submit: that the patitixmers case wcrsuld A. be covmraci under that paxtion of Section 2448(1) {b} which made aa fo3.lows:-- 3

"In any wither awe, axzc:21.j_;~.__* interest ahall he ::a1cn11ated__*-at tha rate at one-half pm: H¢'é2':=..t'-.f * fox: every month <>x__..paj._.rt _"of""-av» month czompriared in the pé:i"cs:1'1'o2:_ "

gzariods frm the date. a;1;:',*~'as'~.t'h¢3 A can may be, dates <:>fpa*ym$:z1t,T'.::ef" ' the tax or penal_t'y_ to "-the _ ¢h3.t"ei. "--~ on which the refméiszfia grantaga-;'*

5. In view' that 1:119 proceadinga :;:£2aj_zzlt;':h'<_:;* ifjté' tare delayed far the _'..~:;taa;:.s::¢¢:i§*;.;s'v atitxéikﬁﬁtable to the petitiféitériA.?v5th§V;'§.4V§1u'é'BVftic>n."VVé'f exclusion of any periodVV"-in. interest do-as mat:

arise. in. f£t&1?:_l$¥8'..f§fA.SeV¥':.;tiOI1 2£i4A(2} . Themfare, aq::on'tgand#d""'"t1iat the petitianer would be 7§r£*2;:£.i:1.§d 'tE§A»t._.i;.1tera$t oven in terms czf Smztion 24'45§é'f%3},. reads as foll<>wa:-

ﬂwhora, as a result: of an order midst Sub-Saczticza-n13} of. Secticm IISWE or Secztion 11$??? 9:: Section 115% or Sub-

Sacztionts: of Semtion 3.43 cm Secs.-tion 144 or Saetion 123'? or Seation 134 or Section 155 car Sacticsn 250 <33: Sactian 254 or Section 260 tax: Secticm 262 ms Section 263 or Section 264 Or an 5 1! and interest is illegal and in tha V"'i'$a.¢ §§__!: finality having been attainasd ._th:9" legal paaition ia con<:ez:neci;>.

7. As held t1i3'.3_ in " % '1'hi.qa:t:njan' 5 case sééand iiravised returzzs alczng Wit}V1 'f;1:.13 t<> condane the delay =:tvV.? é'32ﬂ rendered infz:uc:tuojv.1$,;*v _a. igsita attracting T135. ncuticed the said facts tank up for conaiderémien *i:hé azgﬁlicationa to condone the ::i¢a1.ajf ir:. fi1Vix~.g__j;§1;; reviaad returns and termed __ "claim fez: zrefund" whezrteas the cjuaégtiéﬁn".";«3fT;["exerci5e «sf juriadictian under V-VSec€i:§zi' ' l'1"§£2)fb) of the Act dict not arise.

'4"'V.w*1:'I'x.3T.c.-31f<:;i:=a, in the aszimittzad factual matrix, it

-'.j'.-te2aja"'}iéld that the similar inzpugned ordesra are T "«.:jé:i*bitrary and witheut juzsisdizztion anczi fauna x that since the rasponémrzts had the benefit of the maniea belenging tn the yetitionera up to 6 12 the dates of refund and in the catena oﬁ decisions at the Apes}: M payment of compounded in;tte:1:é3'i:«.;>1:A wag directed that the requéaw:

18% per mmum coanpounda§<i~v..§:im;:.thiy.. §éa§"'o}:en 'V for c:on3ideJ:z~.'1t:ionV tha?" reé's1p'cam'.{ent to has daciaed within {:h_§' i:L;i,:::E:e§' -{therein am accordingly _ a-aZAl:,'}.':21~teef;i 1~1:;t':¥I»,L'z'_;.._VV;::V'eA1;*i.:£::§.c>z:a.a in the atozasam; ':ép.¢.*m;':;;é 'A A 5} 1.s*i.igéaf-..::t:11é"x§sat'ii:iona;: herein stands on at $:E.1i{.1'._}.a:: while kaeping open the pati:L:ic1:ar'3""cs;Laim for intarest over: refund, be ccznzaidered by the reapendent §éif:'}1J7;nx"a;_'};:e.aa£;3;i§;ac1 at farm: weeks fxzzam. the data asf _q 91';'%:§e';5,v the writ patition is alienated. The K order at Azmexure-"ﬁx" :15 quashed. sd/3 IUDGE *albI -

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