MUKESH C. PATEL Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) PETITIONER has sought for to issue a writ of certiorari to quash the order passed at Annex. 'N' dt. 25th March, 2010 by the 1st respondent-CIT and also the intimation dt. 22nd Feb., 2001 issued under S. 143 (1)(a) at Annex. 'E' by the 2nd respondent-Asstt. CIT and, to issue a writ of mandamus to consider the grievance of the petitioner by the 1st respondent on the revision petition filed under S. 264 dt. 7th Nov., 2003 vide Annex. F and, to direct refund of taxes deposited at source and to further direct the respondents to pay the interest thereon in terms of S. 244A of the Act on the refund amount and, for such other orders.

(2.) ACCORDING to the petitioner, he filed the returns of income based on the TDS certificate issued by the employer for the asst. yr. 2000-01. According to him, his employer has deducted the TDS on the alleged value of the perks included in the salary. Though the employer has filed appeals before the appellate authority, the appellate authority by an order dt. 31st July, 2002, gave a finding that the value of the shares allotted under the Employees Stock Option Scheme would not result in any perks to the employee until the expiry of the lock in period and there is no obligation on the employer to deduct TDS at source on the alleged perks. However, he filed the return of income and intimation was issued to the petitioner by the 2nd respondent as per S. 143(1)(a) of the IT Act accepting the returns filed. Immediately, after receipt of the intimation, pursuant to the decision of the Tribunal, the petitioner filed a revision before the 1st respondent during November 2003 seeking revision of the assessment order and the said revision petition came to be rejected, which the petitioner is challenging stating that the said order is non est and refund lies and the effect of the amendment to S. 143(1) of the Act comes into effect only from the subsequent year and not for the assessment year. Accordingly, contending that the revision ought to have been entertained and excess amount ought to have been refunded, he has filed this petition.

(3.) IT is not in dispute that the return filed by the petitioner is for the asst. yr. 2000-01 and the TDS certificate is issued by the employer for the said year. According to the petitioner's counsel, as per the judgment of this Court in the case of Avasarala Automation Ltd. vs. Dy. CIT & Anr. (2004) 189 CTR (Kar) 54 : (2004) 269 ITR 163 (Kar), the deletion of Explanation to S. 143 of the Act came into effect on 1st June, 1999 as such, any amendments in the Act which came into force after the first day of April of the financial year would not apply to the assessment for that year, even if the assessment is actually made after the amendment came into force. As such, the revision is maintainable and the 1st respondent ought to have entertained the revision and pass an order of refund as there was tax deduction at source by the employer towards the shares allotted treating them as perks. Learned counsel has also relied upon the decision of this Court in the case of CIT vs. Infosys Technologies Ltd. (2007) 207 CTR (Kar) 620 : (2007) 293 ITR 146 (Kar) to contend that, stock options were not perks as such, the assessee is not liable to deduct tax on value of shares and the TDS deducted from the salary of the assessee on such perks remitted to the Revenue is refundable. She has also relied upon the decision of this Court reported in S. Thigarajan vs. Asstt. CIT (2009) 30 DTR (Kar) 277. Accordingly, learned counsel has sought for allowing the petition directing the 1st respondent to refund the amount deducted towards perks.