Compulsion to pay any unjust dues per se would cause hardship: Supreme Court
The Income Tax Department in a raid, seizes some share certificates – The assessee requests the Department to sell the shares and appropriate the proceeds to realise the tax payable. The Department does not act on this request, but later demands interest from the assessee. When he pleads for waiver, the AO states he is very rich and has property in a posh area worth Crores.
Is a rich man not entitled to the benefits of Law?
The Supreme Court observed, “A genuine hardship would, inter alia, mean a genuine difficulty. That per se would not lead to a conclusion that a person having large assets would never be in difficulty as he can sell those assets and pay the amount of interest levied. The ingredients of genuine hardship must be determined keeping in view the dictionary meaning thereof and the legal conspectus attending thereto. For the said purpose, another well-known principle, namely, a person cannot take advantage of his own wrong, may also have to be borne in mind. However, another principle should also be borne in mind, namely, that a statutory authority must act within the four corners of the statute. Indisputably, the Commissioner has the discretion not to accede to the request of the assessee, but that discretion must be judiciously exercised. He has to arrive at a satisfaction that the three conditions laid down therein have been fulfilled before passing an order waiving interest.
The Supreme Court also observed, “It was probably in the interest of the revenue itself to realize its dues.”
But Government does not run on sound commercial principles.
We bring you today this judgement delivered on 1st October 2008.
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