Case Law Details
Pankaja Kasturi Herbals India Pvt. Ltd. Vs DCIT (Kerala High Court)
In a recent development, the Madras High Court delivered a significant judgment on Section 245C(5) of the Income Tax Act, 1961, as amended by the Finance Act, 2021. The case in question, Pankaja Kasturi Herbals India Pvt. Ltd. Vs DCIT, saw the court remove the retrospective last date of February 1, 2021, and replace it with March 31, 2021. This decision is a result of the court’s analysis of Ext.P8 order in W.P(C) No. 25867 of 2023, Ext.P10 order in W.P(C) Nos. 26130 of 2023 & 30919 of 2013, and Exts.P39 to P45 in W.P(C) No. 28785 of 2023.
Background: The writ petitions were filed to challenge various orders, including Ext.P8 order in W.P(C) No. 25867 of 2023, Ext.P10 order in W.P(C) Nos. 26130 of 2023 & 30919 of 2013, and Exts.P39 to P45 in W.P(C) No. 28785 of 2023. The issue at hand had already been addressed by the Division Bench of the Madras High Court in a judgment dated November 17, 2023, in W.P(C) No. 13455 of 2021 and connected cases in M/s Jain Metal Rolling Mills v. Union of India [MANU/TN/6417/2023].
Madras High Court’s Decision: The Division Bench of the Madras High Court, in its judgment, made the following key rulings:
i. Amendment to Section 245C(5): Section 245C(5) of the Income Tax Act, 1961, as amended by the Finance Act, 2021, was read down. The retrospective last date of February 1, 2021, was removed, and March 31, 2021, was established as the new last date.
ii. Circular Dated September 28, 2021: The last date of eligibility mentioned in paragraph 4(i) of the impugned circular dated September 28, 2021, was also read as March 31, 2021.
iii. Pending Applications: All applications, even those related to cases arising between February 1, 2021, to March 31, 2021, were deemed to be pending applications for the purposes of consideration by the Interim Board.
iv. Rejection of Applications: Applications rejected on the ground that they did not have a case pending as of January 31, 2021, were set aside. These applications were deemed to be pending applications for consideration by the Interim Board, subject to their eligibility and compliance with the law.
v. Costs: No costs were awarded in the matter.
Conclusion: With the judgment of the Madras High Court, the present writ petitions were allowed, and the impugned orders were set aside. The cases were remitted back to the competent respondent for a fresh decision on the applications in light of the Division Bench’s ruling. This decision brings clarity and a revised perspective on the interpretation and application of Section 245C(5) of the Income Tax Act, 1961, providing relief to the affected parties and establishing a precedent for future cases.
FULL TEXT OF THE JUDGMENT/ORDER OF KERALA HIGH COURT
The present writ petitions have been filed, questioning Ext.P8 order in W.P(C) No. 25867 of 2023, Ext.P10 order in W.P(C) Nos. 26130 of 2023 & 30919 of 2013 and Exts.P39 to P45 in W.P(C) No. 28785 of 2023. The issue is covered by the judgment of the Division Bench of Madras High Court dated 17.11.2023 in W.P(C) No. 13455 of 2021 and connected cases in M/s Jain Metal Rolling Mills v. Union of India [MANU/TN/6417/2023]
2. The learned Division Bench of the Madras High Court had disposed of the batch of these writ petition in following terms which are mentioned in Paragraph 42 is extracted as under:-
“42.In the result, these writ petitions are partly allowed and are disposed off on the following terms :~
(i) Section 245C(5) of the Income Tax Act, 1961 (as amended by the Finance Act, 2021) is read down by removing the retrospective last date of 1st date of February, 2021 as 31st day of March, 2021;
(ii) Consequently the last date of eligibility mentioned paragraph 4(i) of the impugned circular dated 28.09.2021 shall also be read as 31.03.2021;
(iii) all the applications in respect of the petitioners even in respect of the cases arising between 01.02.2021 to 31.03.2021 shall be deemed be pending applications and shall be deemed to be pending applications for the purposes of consideration by the Interim Board;
(iv) Wherever they are rejected on the ground that they did not have a case pending as on 31.01.2021, such orders shall stand set aside and the applications shall be deemed to be pending applications for the consideration by the Interim Board, if otherwise in order and eligible, and shall be dealt with in accordance with law on merits in accordance with the scheme that may be framed by the Central Government as in respect of the other cases which arose prior to 31.01.2021;
(v) No Costs. Consequently all miscellaneous applications shall stand closed.”
As the issue is covered by the judgment of the learned Division Bench of the Madras High Court, in the judgment, M/s Jain Metal Rolling Mills (supra), the present writ petitions are allowed and the aforesaid impugned orders are set aside. The cases are remitted back to the competent respondent for taking fresh decision on the applications in the light of the judgment as aforementioned.
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