Delhi High Court - Orders
Jaipur Mahua Tollway Pvt Ltd (Formerly ... vs Deputy Commissioner Of Income Tax ... on 16 February, 2024
Author: Yashwant Varma
Bench: Yashwant Varma, Purushaindra Kumar Kaurav
$~37 to 40
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ W.P.(C) 1846/2024 & CM APPL. 7720/2024 (stay)
JAIPUR MAHUA TOLLWAY PVT LTD (FORMERLY
KNOWN AS JAIPUR MAHUA TOLLWAY LTD)
..... Petitioner
Through: Mr. Aniket D. Agrawal and Mr.
Samarth Chaudhari, Adv.
versus
DEPUTY COMMISSIONER OF INCOME TAX CIRCLE
13(1) NEW DELHI & ANR. ..... Respondents
Through: Mr. Gaurav Gupta, Sr. Standing
Cousnel along with Mr.
Shivendra Singh and Mr.
Puneett Singhal, Jr. Standing
Counsels, Ms. Mahima Garg
and Mr. Chandan Kumar, Adv.
38
+ W.P.(C) 1848/2024 & CM APPL. 7724/2024 (stay)
JAIPUR MAHUA TOLLWAY PVT LTD (FORMERLY
KNOWN AS JAIPUR MAHUA TOLLWAY LTD)
..... Petitioner
Through: Mr. Aniket D. Agrawal and Mr.
Samarth Chaudhari, Adv.
versus
DEPUTY COMMISSIONER OF INCOME TAX CIRCLE
13(1) NEW DELHI & ANR. ..... Respondents
Through: Mr. Gaurav Gupta, Sr. Standing
Cousnel along with Mr.
Shivendra Singh and Mr.
Puneett Singhal, Jr. Standing
Counsels, Ms. Mahima Garg
and Mr. Chandan Kumar, Adv.
W.P.(C) 1846/2024 & Connected Matters Page 1 of 10
This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above.
The Order is downloaded from the DHC Server on 19/02/2024 at 23:21:46
39
+ W.P.(C) 1851/2024, CM APPL. 7728/2024 (stay) & CM APPL.
9674/2024 (amendment)
JAIPUR MAHUA TOLLWAY PVT LTD (FORMERLY
KNOWN AS JAIPUR MAHUA TOLLWAY LTD)
..... Petitioner
Through: Mr. Aniket D. Agrawal and Mr.
Samarth Chaudhari, Adv.
versus
DEPUTY COMMISSIONER OF INCOME TAX CIRCLE
13(1) NEW DELHI & ANR. ..... Respondents
Through: Mr. Gaurav Gupta, Sr. Standing
Cousnel along with Mr.
Shivendra Singh and Mr.
Puneett Singhal, Jr. Standing
Counsels, Ms. Mahima Garg
and Mr. Chandan Kumar, Adv.
40
+ W.P.(C) 1855/2024, CM APPL. 7736/2024 (stay) & CM APPL.
9672/2024 (amendment)
JAIPUR MAHUA TOLLWAY PVT LTD (FORMERLY
KNOWN AS JAIPUR MAHUA TOLLWAY LTD)
..... Petitioner
Through: Mr. Aniket D. Agrawal and Mr.
Samarth Chaudhari, Adv.
versus
DEPUTY COMMISSIONER OF INCOME TAX CIRCLE
13(1) NEW DELHI ..... Respondent
Through: Mr. Gaurav Gupta, Sr. Standing
Cousnel along with Mr.
Shivendra Singh and Mr.
Puneett Singhal, Jr. Standing
Counsels, Ms. Mahima Garg
and Mr. Chandan Kumar, Adv.
W.P.(C) 1846/2024 & Connected Matters Page 2 of 10
This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above.
The Order is downloaded from the DHC Server on 19/02/2024 at 23:21:46
CORAM:
HON'BLE MR. JUSTICE YASHWANT VARMA
HON'BLE MR. JUSTICE PURUSHAINDRA KUMAR
KAURAV
ORDER
% 16.02.2024
1. These four writ petitions had principally assailed Garnishee Notices dated 31 January 2024 pursuant to which restraints came to be imposed upon the following bank accounts of the writ petitioner:
S. No. Name of Bank A/c No.
1 State Bank of India, Nariman Point, 31683260574
Mumbai
2 State Bank of India, Nariman Point, 32262641347
Mumbai
3 ICICI Bank, Bandra (East), Mumbai 000805015468
4 ICICI Bank, Bandra (East), Mumbai 000805015463
2. For the sake of convenience and clarity we also propose to note that the W.P. (C) Nos. 1855/2024, 1848/2024, 1846/2024 & 1851/2024 pertain to Assessment Years1 2016-17, 2018-19, 2020-21 & 2022-23, respectively.
3. Apart from the challenge to the Garnishee Notices raised and noticed above, W.P. (C) Nos. 1851/2024 and 1855/2024 additionally seek quashing of orders dated 10 February 2024 and 12 February 2024, respectively, pursuant to which pending rectification applications have come to be disposed of.
4. These writ petitions had originally come up for consideration on 08 February 2024, when we had taken note of the contention of the writ petitioners that the Garnishee Notices had come to be issued even though various applications for rectification were pending and the respondents having adopted coercive measures without disposing of 1 AYs W.P.(C) 1846/2024 & Connected Matters Page 3 of 10 This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 19/02/2024 at 23:21:46 those applications. The details of the applications of the writ petitioners which were pending found mention in the application for stay of demand and the tabular statement forming part of that application is reproduced hereinbelow:
S. Demand Assessment Amount of Remarks No. under Year Demand (in INR) 1 154 2016-17 40,00,870 As stated above, the Assessee respectfully 2 154 2016-17 84,12,462 submits that said tax 3 234D 2016-17 4,80,096 demand is erroneous and is pursuant to certain mistake apparent from record in the order which require rectification under Section 154 of the Act. The same has been duly highlighted by Assessee vide letter dated 30 April 2021 filed with your good office.
Copy of rectification application along with annexures are enclosed as Annexure II for your goodself's kind reference. The sais rectification application is still pending for disposal by our good office as on date 4 234D 2018-19 9,587 It is respectfully submitted that the said 5 143(3) 2018-19 91,250 demand is also pursuant to mistake apparent from records which require rectification under Section 154 of the Act.
As such, the Assessee has filed application dated 18 February 2021 before your good office to rectify the error in the order. Copy of application is enclosed W.P.(C) 1846/2024 & Connected Matters Page 4 of 10 This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 19/02/2024 at 23:21:47 herewith as Annexure III for your goodself's kind reference. The said rectification application is still pending for disposal by your good office as on date.
6 154 2020-21 7,450 In this regard, the
assessee wish to
highlight that
rectification order dated
14 March 2022 was
passed by CPC as per
which tax demand of Rs.
INR 1,22,310 was
payable by Assessee.
Further, the said tax
demand was paid by
Assessee on 13 April
2022 (i.e. within 30 days
of rectification order).
Copy of rectification
order and challan is
enclosed as Annexure IV
and Annexure V for your
goodself's kind
reference. As such, since
demand is paid within 30
days by Assessee,
Assessee cannot by
treated as 'Assessee in
Default' and no interest
is payable under Section
220(1) of the Act.
However, CPC has
erroneously levied
interest of INR 7,450
under Section 220(1) of
the Act [in rectification
order dated 02
November 2023 passed
under Section 154 of the
Act - attached as
Annexure VI for
reference].
In view of the above,
considering it is mistake
W.P.(C) 1846/2024 & Connected Matters Page 5 of 10
This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 19/02/2024 at 23:21:47 apparent from record, Assessee has filed rectification application dated 08 January 2024 before your good office
- enclosed as Annexure VII for your goodself's kind reference. In view of this, no demand is payable as Assessee.
7 143(1)(a) 2022-23 16,45,17,630 It is submitted that the said demand is also pursuant to mistake apparent from record in intimation dated 26 July 2023 issued under Section 143(1) by CPC against which Assessee has filed follow up rectification letter with your good office on 08 January 2024. Copy of application is enclosed as Annexure VIII for your goodself's kind reference. In view of this, no demand is payable by the Assessee.
It was in the aforesaid backdrop that we had called upon respondents to obtain instructions.
5. However, and when the matter was called thereafter on 14 February 2024, we were apprised of the passing of orders dated 10 and 12 February 2024 in terms of which the pending rectification applications pertaining to AY 2022-23 and 2016-17 had come to be rejected.
6. The writ petitioners had contended that while dealing with the pending rectification applications, when the petitioner had approached W.P.(C) 1846/2024 & Connected Matters Page 6 of 10 This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 19/02/2024 at 23:21:47 the Centralized Processing Center2 it was apprised that it would have to move the jurisdictional Assessing Officer3. However, and as the order dated 10 February 2024 in W.P (C) 1851/2024 would indicate the jurisdictional AO has taken the position that rectification powers have not been conferred upon him by the CPC. It has additionally observed that the adjustments made by the CPC are not covered under Section 154 of the Income Tax Act, 19614. Similarly, while passing the order dated 12 February 2024 in W.P (C) 1855/2024 it has observed that since the petitioner has failed to file an appeal before the Commissioner of Income Tax (Appeals)5 against the Original Order dated 31 March 2021 the rectification application cannot be entertained.
7. We find ourselves unable to appreciate the manner in which the two rectification applications have come to be disposed of and that too after we had taken cognizance of the grievance of the writ petitioners. If the AO were of the opinion that the powers of rectification did not stand conferred, it would have been well advised to desist from making observations pertaining to the merits of the application. Similarly, the fact that an appeal has not been filed would not constitute a valid ground for refusing to consider a rectification application provided the issues that are raised fall within the ambit of Section 154 of the Act.
8. Mr. Gupta, learned counsel appearing on instructions submitted that against the various demands which remain outstanding, the petitioner has chosen not to invoke the appellate remedies available 2 CPC 3 AO 4 Act 5 CIT(A) W.P.(C) 1846/2024 & Connected Matters Page 7 of 10 This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 19/02/2024 at 23:21:47 and has merely moved rectification applications. He has also alluded to the petitioner having not made any deposit against the outstanding demand. We may note that the total demand as per the Garnishee Notices is stated to be INR 17,16,85,384/-.
9. However, and notwithstanding the above, Mr. Gupta submitted that the jurisdictional AO would have no objection to considering the rectification applications afresh in case such liberty were to be accorded by the Court.
10. As we view the order dated 12 February 2024, pertaining to AY 2016-17, we find that the rectification application has come to be rejected solely on the ground that no appeal had been filed by the writ petitioner against the original order of assessment. In terms of that order, the rectification applications which had been pending right from 30 April 2021, 05 October 2021 and 09 January 2024 have come to be summarily rejected. Similarly, while passing the order dated 10 February 2024 pertaining to AY 2022-23, while the jurisdictional AO has on the one hand held that it has not been transferred rectification rights by the CPC, it has proceeded further to observe that the adjustments would not fall within the ambit of Section 154 of the Act.
11. In our considered opinion therefore, both these orders, namely, 10 February 2024 and 12 February 2024 are liable to be quashed and the matter remitted to the jurisdictional AO for considering the pending rectification applications afresh and in accordance with law.
12. W.P. (C) 1851/2024 and W.P. (C) 1855/2024 shall stand allowed in part and the orders dated 10 February 2024 and 12 February 2024 shall stand quashed. We dispose of those writ petitions and the pending applications with a direction to the jurisdictional AO to examine and dispose of the rectification applications as made by the W.P.(C) 1846/2024 & Connected Matters Page 8 of 10 This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 19/02/2024 at 23:21:47 writ petitioner pertaining to AYs 2016-17 and 2022-23 afresh and in accordance with law. All rights and contentions of respective parties in that regard are kept open.
13. Since Garnishee Notices already operate, we take note of the additional prayer made by the writ petitioner of it being permitted to securitize 20% of the outstanding tax demand by submitting an undertaking that it would maintain a credit balance in the aforenoted accounts to the extent of INR 3,43,37,076/- being 20% of the total outstanding demand till such time as the rectification applications are disposed of. In our considered opinion the prayer for lifting of the Garnishee Notices and for provisioning of adequate security is an issue which would merit examination and consideration by the jurisdictional AO in the first instance.
14. We thus leave it open to the writ petitioner to move the jurisdictional AO in this regard also. The prayer for modification and lifting of the Garnishee Notices as well as for disposal of the pending rectification applications may be considered with due expedition and disposed of within a period of one week.
15. We additionally observe that insofar as W.P. (C) No. 1846/2024 is concerned, the case of the writ petitioner was that as per the rectification order dated 14 March 2022 passed by the CPC a demand of INR 1,22,310/- came to be created which was duly paid by the petitioner on 13 April 2022 and thus within 30 days of the passing of the aforesaid order. It is in the aforesaid context that they question the respondent treating it as an assessee in default and levying interest of INR 7450/- under Section 220(1) of the Act. In this respect, the assessee is stated to have filed a rectification application on 08 January 2024. That rectification application has come to be rejected W.P.(C) 1846/2024 & Connected Matters Page 9 of 10 This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 19/02/2024 at 23:21:47 by an order dated 12 February 2024.
16. Insofar as W.P. (C) 1848/2024 is concerned, the petitioner has yet again filed a rectification application dated 18 February 2021. The said application too has been disposed of by a separate order dated 12 February 2024.
17. However, and since orders disposing of the rectifications in W.P. (C) 1846/2024 and W.P. (C)1848/2024 have not been questioned before us, we leave it open to the writ petitioner to adopt such remedies as may be otherwise available in law.
YASHWANT VARMA, J.
PURUSHAINDRA KUMAR KAURAV, J.
FEBRUARY 16, 2024/kk W.P.(C) 1846/2024 & Connected Matters Page 10 of 10 This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 19/02/2024 at 23:21:47