Delhi High Court Gives Income Tax Dept Final Chance To Credit ₹3.65 Crore Advance Tax To 92-Year-Old Assessee

The Division Bench of Justices Subramonium Prasad and Renu Bhatnagar has directed the Department to ensure that the amount is credited to the assessee's account by October 31, 2026.

The development arises from the Court's August 21 order upholding the Income Tax Appellate Tribunal's direction to allow the assessee credit for the advance tax paid in an earlier assessment year against the capital gains tax liability arising in a subsequent assessment year.

The High Court had noted that the advance tax paid by the assessee's late husband pertained to AY 2016-17, whereas the assessee's return could only have been filed for AY 2018-19. Since the advance tax and the subsequent return related to the same transaction and the same gain, the Court had directed that the exercise be carried out manually if the Department's electronic system did not permit seamless processing.

When the matter came up again, counsel for the Income Tax Department submitted that the exercise was being carried out manually and that some time was consequently being taken to complete the process.

Counsel for the assessee, meanwhile, submitted that the assessee, who is about 92 years old, could not be made to wait endlessly for the amount. It was further submitted that despite having succeeded in the matter, the assessee had not yet received the money and was losing interest on the amount.

Taking note of the circumstances, the High Court said it was inclined to give the Department “one last opportunity” till October 31 to comply with its order.

The Court made it clear that if the Department failed to do so, it would direct the Department to credit the interest amount as well.

The matter has been listed on November 02 for compliance.

For Appellant: Advocate Puneet Rai, SSC along with Mr. Ashvini Kumar, Mr. Rishabh Nangaia, JSCs

For Respondent: Advocate Deepti Gupta