Gujarat High Court
Movaliya Bhikhubhai Balabhai vs Income Tax Officer - Tds - 1 - Surat & ... on 27 January, 2017
Author: Harsha Devani
Bench: Harsha Devani, G.R.Udhwani
C/MCA/59/2017 ORDER
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
MISC. CIVIL APPLICATION (FOR DIRECTION) NO. 59 of 2017
In SPECIAL CIVIL APPLICATION NO. 17944 of 2015
===============================================================
MOVALIYA BHIKHUBHAI BALABHAI....Applicant(s)
Versus
INCOME TAX OFFICER - TDS - 1 - SURAT & 1....Opponent(s)
===============================================================
Appearance:
MR TUSHAR L SHETH, ADVOCATE for the Applicant
MR SUDHIR M MEHTA, ADVOCATE for the Respondents No. 1 - 2
===============================================================
CORAM: HONOURABLE MS.JUSTICE HARSHA DEVANI
and
HONOURABLE MR.JUSTICE G.R.UDHWANI
Date : 27/01/2017
ORAL ORDER
(PER : HONOURABLE MS.JUSTICE HARSHA DEVANI)
1. By this application, the applicant - original petitioner seeks a direction to the second respondent - ITO, Ward 3(3) (1), Surat to return/refund the wrongly deducted amount of Rs.2,07,416/- manually to the applicant forthwith in compliance of the directions issued by this court in the judgment and order dated 31.03.2016 passed in Special Civil Application No.17944 of 2015.
2. Heard Mr. Tushar Sheth, learned advocate for the applicant and Mr. Sudhir Mehta, learned Senior Standing Counsel for the respondents.
Page 1 of 3HC-NIC Page 1 of 3 Created On Tue Jan 31 00:27:37 IST 2017 C/MCA/59/2017 ORDER
3. Vide judgment and order dated 31.03.2016 passed in the captioned special civil application, this court had held that since interest under section 28 of the Land Acquisition Act, 1894, partakes the character of compensation, it does not fall within the ambit of the expression "interest" as contemplated in section 145A of the Income Tax Act, 1961. The court had, accordingly, held that the first respondent - Income Tax Officer was not justified in refusing to grant a certificate under section 197 of the Income Tax Act to the applicant for non-deduction of tax at source, inasmuch as, the applicant was not liable to pay any tax under the head "income from other sources" on the interest paid to it under section 28 of the Act of 1894. The court, accordingly, directed to the respondent to return an amount of Rs.2,07,416/- wrongly deducted at source out of the amount of Rs.20,74,157/- payable to the applicant under section 28 of the Act of 1894..
4. Subsequent to the passing of the said order, the first respondent - Income Tax Officer, TDS-1, Surat moved Miscellaneous Civil Application No.1887 of 2016 seeking a direction to the applicant to claim credit of TDS amount of Rs.2,07,416/- in the return of income for that year. Since the court was not inclined to grant the said relief, the learned standing counsel for the respondents had submitted that the first respondent herein would not be in a position to refund the said amount, inasmuch as, the amount in question had already been deducted and transferred under the permanent account number of the applicant herein and therefore, it was difficult for the TDS-AO to return/deposit the said amount. It was submitted that to avoid technical difficulty, the PAN-AO be Page 2 of 3 HC-NIC Page 2 of 3 Created On Tue Jan 31 00:27:37 IST 2017 C/MCA/59/2017 ORDER directed to return/refund the said amount to the applicant.
5. Having regard to the judgment and order dated 31.03.2016 passed by this court in the captioned special civil application, the respondents - Income Tax Officer were under an obligation to abide by the said order and return/refund the said amount to the applicant - original petitioner. If there is any difficulty inter-se in returning the said amount, it would normally be expedient for the authorities to resolve the matter at their end. However, having regard to the fact that the applicant had already moved an application seeking a direction to the second respondent with whom the amount in question deposited, the court is of the view that the application deserves to be allowed in terms of the relief prayed for therein.
6. For the foregoing reasons, the application succeeds and is, accordingly, allowed. The second respondent - ITO, Ward 3(3)(1), Surat is directed to forthwith return/refund the wrongly deducted amount of Rs.2,07,416/- manually to the applicant in compliance of the directions issued by this court in the judgment and order dated 31.03.2016 passed in Special Civil Application No.17944 of 2015. Rule is made absolute accordingly with no order as to costs.
Direct Service is permitted qua respondent No.2.
(HARSHA DEVANI, J.) (G.R.UDHWANI, J.) parmar* Page 3 of 3 HC-NIC Page 3 of 3 Created On Tue Jan 31 00:27:37 IST 2017