|DATE:||(Date of pronouncement)|
|DATE:||July 9, 2014 (Date of publication)|
|Click here to download the judgement (mohan_bansal_CPC_harrassment.pdf)|
CPC hauled up for harassing assessee by imposing tax of 60% on LTCG & refusing to rectify
An intimation u/s 143(1) was passed by the ACIT (CPC) in which the long-term capital gains were charged to tax at 60% instead of the applicable rate of 20%. The assessee filed an on-line rectification application. However, no order thereon was passed. Instead, the assessee was informed on telephonic enquiry that the appluication was rejected. The assessee filed an appeal to the CIT(A). The CIT(A) dismissed the appeal by raising hypothetical questions and going into irrelevant issues. On appeal by the assessee to the Tribunal HELD:
In the entire Income-tax Act, there is no provision charging a tax rate of 60% on long term capital gains. The Delhi High Court has issued remedial directions to improve hardships faced by tax payers while processing the e-returns at CPC, Bangalore. The Court has discussed the background that in order to fasten the processing of returns, the revenue has introduced electronic filing of income tax returns, TDS returns, e-tax payments and it operates Centralised Processing Centre (CPC) at Bangalore. This is manned by Higher Ranking Officers of Income Tax Department. The problem is faced by tax payers, when demand is raised or refund reduced on account of either suo motu adjustment by the Income Tax Department and refund against tax demands or mismatch of TDS credit or any other adjustment or disallowance of claim made by tax payer in the return and uploaded by the assessee in its e-returns. This is a general grievance among the tax payers that the AOs do not adhere to the time limit specified for the disposal of rectification applications and tax payers are invariably called upon to file duplicate application or new application. Further, no record or no receipt counters or registers for receipt of such applications are maintained. Thus, there is no record/register remained with the AO with details or particulars of rectification application made u/s. 154 of the Act as is evident from the present case. Similar directions were issued by the Delhi High Court in the case of its own motion Vs. CIT, WP(C) No. 2659/2012 dated 14.03.2013. The Delhi High Court vide para 18 has issued dictum as under: “18. Each application under Section 154 has to be disposed of and decided by a speaking order. This is the mandate of the Act. The order has to be communicated to the assessee and there is a relevant column to be filled in the register, which is now required to be maintained. The Board should issue specific directions to ensure that there is full compliance of the said requirements and directions by the Assessing Officers, Dak counters and Aayakar Sewa Kendras. This is the first mandamus or direction we have issued in the present judgment“. As the facts in the present case are very clear that charging of long term capital gain can only be @ 20% in assessment year 2011-12 and not @ 60% as charged in intimation u/s 143(1) of the Act by CPC, Bangalore which according to the provisions of the Income Tax Act is not legal. Hence, we quash the intimation and appeal of assessee is allowed. The jurisdictional AO is directed to amend the intimation issued by CPC, Bangalore, while giving appeal effect to this order.