PATCHALA SEETHARAMAIAH Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) This writ petition seeks refund of tax of Rs.23,281/-paid under the Voluntary Disclosure of Income Scheme, 1997 (for short "the Scheme") which was enunciated under the Finance Act, 1997 (Act 26 of 1997). The petitioner has filed a declaration on 27-12-1997 under the said Scheme disclosing the income for the years 1991-92 and 1992-93, for which no returns were filed by him under Section 139(1) of the Income Tax Act (for short "the Act"). Later, the petitioner had paid the tax as computed under the said declaration on 31 st March, 1998 and sought for the issuance of a certificate under the Scheme. However, the said payment of lax was beyond the prescribed period under the Scheme as there was a delay of one day. Since the declaration was filed on 27-12-1997, the tax had to be paid by the declarant within a period of three months from the date of declaration along with simple interest at 2% per month as provided under Section 67 of the Scheme. Therefore, the respondents declined to grant the certificate under Section 67(2) of the Scheme in view of the delay in payment of the tax. Thereupon, the petitioner sought for the refund of the tax paid under the Scheme as the declaration as has been filed is deemed to be void. However, the respondents refused to entertain the said request under the Proceedings No.VDIS'97/CIT/VJA/99/l 781 dated 26-4-1999 on the ground that Section 70 of the Scheme prohibits refund of tax paid under the Scheme under any circumstances whatsoever.

(2.) Sri Ravi S., learned Counsel for the petitioner, relying on Section 67(2) of the Scheme sought to contend that in the event of making any payment of tax beyond the period prescribed under Section 67(1) of the Scheme, sub-section (2) of the Section 67 itself contemplates that the declaration filed shall be deemed never to have been made under the Scheme. Therefore, such a declaration becomes a void declaration and as such the refusal to refund the tax paid under the said void declaration is wholly unsustainable.

(3.) However, Sri J. V. Prasad, learned senior Standing Counsel appearing on behalf of the respondents, sought to sustain the impugned action of refusal to refund the tax paid by placing reliance on Section 70 of the Scheme which, as mentioned supra, contemplates that any amount of tax paid shall not be refundable under any circumstances.