Myntra Designs Private Limited Vs National Faceless Assessment Centre (Karnataka High Court)
Karnataka High Court held that withholding of refund without satisfying requirements of provisions of section 241A of the Income Tax Act is unsustainable in law. Accordingly, refund along with interest allowed.
Facts-
The petitioner has filed this petition for directions to the Respondents to issue refund of Rs.9,30,46,736/- along with applicable interest u/s. 244A in an expeditious and timely manner. The petitioner mainly contended that the refund was being withheld without affording an opportunity and without recording an opinion as would be required u/s. 241A of the IT Act.
Conclusion-
Held that the consideration falls short of the requirements under the provisions of Section 241A of the IT Act, which stipulate that the Assessing Officer, having regard to the fact that notice has been issued under sub-section (2) of Section 143, must record in writing an opinion with reasons on how the revenue’s interest would be adversely affected if refund is allowed. The withholding of the refund in the manner as now considered by the Assistant Commissioner of Income Tax, ReAC (AU)-1(2)(1), Surat cannot be accepted, and there must be interference by this Court.
FULL TEXT OF THE JUDGMENT/ORDER OF KARNATAKA HIGH COURT
The petitioner has filed this petition for directions to the Respondents to issue refund of Rs.9,30,46,736/- as computed under Refund Intimation dated 22.09.2022 bearing DIN: CPC/2122/A6/243697378 [Annexure A] along with applicable interest under Section 244A of the Income Tax Act, 1961 [for short, ‘the IT Act’] in an expeditious and timely manner. Sri. Tarun Gulati, the learned Senior counsel for the petitioner, and Sri. Y.V.Raviraj, the learned Senior standing counsel for the respondents, are heard.
2. The petitioner, for the Assessment Year 2021-22 is informed about the computed refund in a sum of Rs.31,94,20,940/- [including the principal amount in a sum of Rs.29,35, 11,360/-], and this computation is as of 22.09.2022. On 16.05.2023, the third respondent [the jurisdictional Additional Commissioner of Income Tax], referring to the withholding of refund to the petitioner for the Assessment Year 2021-2022, has informed the first respondent [the Assessing Officer with the National Faceless Assessment Centre – NaFAC] that:
