| Case ID |
1014d797-e62e-489e-9463-6a560326843c |
| Body |
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| Case Number |
CIVIL MISCELLANEOUS WRIT PETITION No. 687 OF 2005 |
| Decision Date |
Jul 26, 2005 |
| Hearing Date |
|
| Decision |
The court held that the Additional Commissioner of Income-tax acted arbitrarily and illegally by reducing the period for tax payment from 30 days to 1 day without sufficient justification. The notice of demand was quashed, and the petitioner was entitled to the return of the amount collected. The court emphasized the importance of allowing a reasonable time for payment, especially when the demand exceeded the declared income. The court also highlighted that the actions taken by the Additional Commissioner undermined public trust in administrative fairness. |
| Summary |
In the case of Farrukhabad Gramin Bank v. Additional Commissioner of Income Tax, the Allahabad High Court addressed significant issues surrounding the Income-tax Act's provisions regarding the collection and recovery of tax. The primary contention was the arbitrary reduction of the payment period from 30 days to just 1 day, which the petitioner argued deprived them of their right to seek legal remedies. The court scrutinized the actions of the Additional Commissioner, concluding that the reasons provided for such a drastic reduction were irrelevant and did not justify the haste shown. The judgment reinforced the principle that tax authorities must adhere to procedural fairness and provide reasonable timeframes for compliance, especially in cases where substantial amounts are involved. This ruling is crucial for entities engaged in banking and finance, as it sets a precedent for protecting their rights in tax matters. |
| Court |
Allahabad High Court
|
| Entities Involved |
State Bank of India,
Farrukhabad Gramin Bank
|
| Judges |
R.K. Agrawal,
Rajesh Kumar
|
| Lawyers |
Shakeel Ahmad,
A.N. Mahajan,
Govind Krishna
|
| Petitioners |
Farrukhabad Gramin Bank
|
| Respondents |
Additional Commissioner of Income Tax
|
| Citations |
2005 SLD 2546,
(2005) 277 ITR 320
|
| Other Citations |
CIT v. Kerala State Co-operative Apex Bank [2001] 251 ITR 194/ 118 Taxman 321 (SC),
Smt. Achamma Kuriakose v. State of Kerala [1988] 171 ITR 494 (Ker.),
Mohan Singh v. CIT [1993] 204 ITR 571/[1994] 73 Taxman 88 (Punj. & Har.),
Mrs. R. Mani Goyal v. CIT [1996] 217 ITR 641/ 85 Taxman 139 (All.),
Farrukhabad Gramin Bank v. Addl. CIT [2005] 273 ITR 113 (All.),
ITO v. M.K. Mohammed Kunhi AIR 1969 SC 430,
Tata Cellular v. Union of India AIR 1996 SC 11,
Special Director v. Mohd. Ghulam Ghouse AIR 2004 SC 1467,
Asstt. CCE v. Dunlop India Ltd. [1985] 154 ITR 172 (SC),
Empire Industries Ltd. v. Union of India [1986] 162 ITR 846 (SC),
Dharam Pal Singh Rao v. ITO[Civil Miscellaneous Writ Petition No. 1646 of 2004 dated 5-8-2004]
|
| Laws Involved |
Income-tax Act, 1961
|
| Sections |
220,
156,
80P(2)(a)(i),
226(3),
143(3),
220(1),
220(6)
|