Case Law Details
Circular No. 20/2017 makes clear the intention of the Department not to contest those cases where the assessees had been given the benefit of adjustment of seized cash against the advance tax liability. There cannot be a situation where for those Assessees who have continued to remain in default of payment of advance tax the benefit of Circular No. 20/2017 is extended but not to those defaulting assessees whose request made prior thereto for adjustment of the seized cash against advance tax dues is refused and adjustment is made against the tax demand prior to the date of the above Circular. This discrimination vis-a-vis two sets of defaulting assessees cannot be legally countenanced, particularly since the stand of the Department, as made explicit by Circular No. 20/2017, is to grant the benefit of adjustment of seized cash against advance tax liability to all assessees in default of payment of advance tax.
The Court, therefore, sees no justification in the Department not granting the benefit of the Circular No. 20/2017 to these two assessees, notwithstanding that the Department may have adjusted the seized cash against their respective determined tax liability.
Full Text of the High Court Judgment / Order is as follows:-
The question that arises in both these petitions is whether the Respondent Income Tax Department (‘Department’) is obliged to give the Petitioners the benefit of adjustment of the cash seized during a search operation against the advance tax payment that was due from the Petitioners (hereafter ‘Assessees’)?
2. The facts in brief leading to the filing of the present petitions are that, during the course of a search carried out under section 132B of the Income Tax Act, 1961 (‘Act’) on 27-9-2011, cash was found in the premises of both the assessees. As far as Ms. Latika Datt Abbott (the Petitioner in W.P. (C) 6491 of 2016) is concerned, the cash seized was to the extent of Rs. 1.18 Crores. In the case of Ms. Charu Datt Bhatia (the Petitioner in W.P. (C) 6588 of 2016), the cash seized was Rs. 96,50,000 in the aggregate.
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