Unjust Retention Of Money Is Against Fundamental Principles And Patently Illegal: Jharkhand HC Directs Electricity Board JBVNL To Refund TDS
The Jharkhand High Court has observed that any unjust retention of money or property of another is against the fundamental principles of justice, equity and good conscience, therefore, unauthorized deductions from the running bills are patently illegal.
The Court also imposed a hefty cost of Rs 5 Lacs on the Managing Director of Jharkhand Bijli Vitran Nigam Limited (JBVNL) for unnecessary litigation and frivolous defence.
The Division Bench of Acting Chief Justice Shree Chandrashekhar and Justice Navneet Kumar observed “Any unjust retention of money or property of another shall be against the fundamental principles of justice, equity and good conscience. The unauthorized deductions from the running bills of the petitioner-Firm are patently illegal. Such deductions caused loses to the petitioner-Firm which filed its Income Tax retuns but was deprived of Rs. 2,90,32,000/- and thereby suffered business or alteast interest losses. On the other hand, the JBVNL was unjustly enriched and need to restitute the petitioner-Firm. The refund of Rs. 2,90,32,000/- must therefore carry interest as a matter of course.”
Senior Advocate MS Mittal appeared for the Petitioner while Advocate General Rajiv Ranjan and Senior Standing Counsel Sachin Kumar appeared for the Respondents.
The Petitioner Anvil Cables is a private limited company that approached the High Court for directions to Respondent-JBVNL to issue the Tax Deducted at Source (TDS) Certificate of Rs. 2,90,32,000/- which was deducted as income tax towards a supply of materials to JBVNL. It was submitted that withholding the amount without issuing the TDS Certificate was arbitrary and unlawful. JBVNL had filed an appeal, against the demand notice sent by the Petitioner, before the CIT(Appeal).
The Court held, “The imposition of cost on the party which started litigation without any just cause or took false and frivolous defences is necessary to discourage the dishonest litigant. To this end, the Court is required to impose such cost that would make the litigant think twice before putting up any speculative claim or defence…The Petitioner-Firm was unnecessarily dragged to the Court and, that too, knowingly and for no fault on its part. The litigation file that has been produced in the Court reveals that a decision in the context of the order dated 14th March 2024 passed by this Court has been taken at the highest level of the Managing Director of JBVNL. Therefore, we are of the definite opinion that the JBVNL must be saddled with cost of Rs.5 Lacs which shall be recovered from the Managing Director.”
The Court also said that as per clause 10.7.4 of Jharkhand State Electricity Regulatory Commission, Ranchi (Electricity Supply Code) Regulation, 2015, the interest rate to be paid on any excess amount paid by the consumer is equivalent to the interest rate paid by the consumer on delay payment surcharge. Therefore, the JBVNL shall pay interest over the withheld amount of Rs. 2,90,32,000/- as per the clause.
Accordingly, the Court allowed the petition.
Cause Title: Anvil Cables Pvt. Ltd. v. State of Jharkhand and Ors.
Appearances:
Petitioner: Senior Advocate MS Mittal, Advocates Rahul Lamba and Salona Mittal
Respondents: Advocate General Rajiv Ranjan Senior Standing Counsel Sachin Kumar, Standing Counsel Anurag Vijay, AC Om Prakash and AC Shivam Singh.