Sony India Private Limited, New Delhi vs. DCIT - (Income Tax Appellate Tribunal) (04 Jan 2024)

Mere reflection of demand on e-filing portal does not absolve Revenue from properly serving the intimation and demand notice

MANU/ID/0009/2024

Direct Taxation

In present case, the assessee is a resident corporate entity. The core issue arising for consideration is relating to chargeability of interest under Section 220(2) of the Income-tax Act, 1961 (IT Act).

There cannot be levy of interest under Section 220(2) of the Act for alleged non-payment of FBT liability. Furthermore, the record reveals that, once the assessee came to know the fact that the demand relating to FBT liability was appearing in the portal of the Income Tax Department, it had opened a communication channel with the Assessing Officer continuously seeking information regarding service of intimation and demand notice creating such liability. However, the requests of the assessee failed to evoke any response from the Assessing Officer. These are admitted facts on record as learned first appellate authority has not disputed assessee's claim.

The reason for negating assessee's claim is, the assessee was aware of the tax liability uploaded by Revenue on e-filing portal. Mere reflection of demand on e-filing portal does not absolve Revenue from properly serving the intimation and demand notice qua the FBT liability pertaining to assessment year 2009-10. Pertinently, in course of hearing of the present appeal, a report of the Assessing Officer was called for with regard to assessee's claim of non-service of intimation and demand notice pertaining to FBT liability. However, the Revenue has failed to furnish any material, which can establish that the intimation and demand notice concerning FBT demand was ever served on the assessee.

Though, it may be a fact that, the assessee might have discharged the FBT liability appearing on the portal of the Income Tax Department in the year 2018, but that act of the assessee, by itself, cannot fasten interest liability under Section 220(2) of the Act upon the assessee. Thus, the assessee cannot be called upon to pay interest charged under Section 220(2) of the Act amounting to Rs.91,84,500. Accordingly, the Assessing Officer directed to delete the demand and refund the amount adjusted against the refund due for the impugned assessment year. Appeal allowed.

Tags : ASSESSMENT INTEREST LEGALITY