Microsoft Corporation India Pvt. Ltd. Vs DCIT (Delhi High Court)
Delhi HC Pulls Up Revenue for 8-Year Delay: Orders Immediate Refund with Interest & Personal Costs
The Delhi High Court allowed the writ petition filed by Microsoft Corporation India Pvt. Ltd., directing the Income Tax Department to refund ₹5.37 crore arising from Fringe Benefit Tax (FBT) along with applicable interest under Sections 244 and 244A(1A) of the Income-tax Act, 1961.
The Court noted that as far back as 16.06.2017, the Assessing Officer himself had acknowledged that amounts of ₹6.94 crore and ₹5.37 crore were refundable to the petitioner. While the larger amount was eventually paid, the balance refund of ₹5.37 crore was withheld for more than eight years, allegedly for want of a refund-adjustment challan—a purely ministerial act.
Strongly criticising the conduct of the tax authorities, the Court described the delay as “shocking” and “callous”, observing that such inaction should have pricked the conscience of the officers concerned. The Court held that the petitioner was unjustly compelled to approach the High Court for enforcement of a refund already determined by the Department itself.
Rejecting the Revenue’s request for further time, the Court directed that the entire refund amount along with statutory interest be credited to the petitioner’s bank account on or before 15.02.2026. Importantly, the Court imposed a personal cost of ₹1,00,000 on the Deputy Commissioner of Income Tax, payable from his own pocket, in the event of non-compliance by the stipulated date.
