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Shree Avdhut Nivas Trust vs. ITO - (Income Tax Appellate Tribunal) (17 Nov 2023)

Assessing Officer has no authority to withhold the refund on ground that, assessee has filed belated return or invalid return

MANU/IB/0555/2023

Direct Taxation

In facts of present case, the assessee is a religious Trust duly registered under Section 12A of the Income Tax Act,1961. The Assessing Officer found that the source of income of the Trust was interest income and donation. The assessee Trust has shown gross receipt of Rs. 1,26,65,692/- and has applied income of Rs. 1,30,73,719for Revenue expenditure towards objects of the Trust. Thus the A.O. verified the details and accepted the Nil income filed by the assessee, but has not issued refund of Rs. 2,60,900 being TDS from interest income.

Aggrieved against the same, the assessee filed an appeal before Learned NFAC and claimed issuance of refund as per Section 237 of the Act. Further the Learned NFAC held that, it has no power to condone the delay in filing the original Return of Income under Section 119(2)(b) of the Act. Aggrieved against the same, the assessee is in appeal.

It is not in dispute that, the assessee filed its Return of Income along with Audit Report in Form 10B with Profit and Loss and Balance sheet. In the return, the assessee claimed Nil income as the assessee trust was enjoying the benefit of Section 12A from 11th December, 1979 onwards. This return resulted in a refund of Rs. 2,60,900 which is nothing but TDS from banks and financial institutions. The Learned A.O. during the course of reassessment proceedings has verified the source of income of the Trust namely interest income and donation and application of income by the assessee for the objects of the Trust. Having been satisfied, the Assessing Officer completed the assessment as Nil, consequently any tax paid by the assessee is liable to be refunded as per Section 237 of the Income Tax Act.

As per Section 237 of IT Act, if any person satisfies the [Assessing] Officer that the amount of tax paid by him or on his behalf or treated as paid by him or on his behalf for any assessment year exceeds the amount with which he is properly chargeable under this Act for that year, he shall be entitled to a refund of the excess.

The Assessing Officer has no authority to withhold the refund due to the assessee on the ground that the assessee has filed belated return or invalid return. When the Assessing Officer completed the reassessment and determined the assessed income as Nil, he has no authority to withhold the refund due to the assessee which is against the provisions of Section 237 of the Act. Therefore, the order passed by the Learned NFAC is set aside with the direction to the A.O. to issue refund due to the assessee with applicable interest in accordance with law.Appeal filed by the Assessee is allowed.

Tags : ASSESSMENT   REFUND   ENTITLEMENT  

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