After 8-Year Delay, Delhi HC Orders ₹5.37 Crore ITR Refund to Microsoft India with Interest

The Delhi High Court has directed the Income Tax Department to refund ₹5.37 crore to Microsoft Corporation India Private Limited, along with interest, after an 8-year delay.  

The court criticised the department's negligence and set a deadline for compliance. 

Background of the Refund Delay 

Microsoft India filed a writ petition with the Delhi High Court, seeking the release of a ₹5.37 crore refund related to fringe benefit tax.  

The company highlighted a communication from June 16, 2017, by the Additional Commissioner of Income Tax, which confirmed the amounts payable.  

Despite a portion being paid, ₹5.37 crore remained unpaid for over 8 years. The company argued that the delay was due to the Assessing Officer awaiting a routine adjustment challan.  

Microsoft India claimed interest under Sections 244 and 244A(1A) of the Income Tax Act and requested exemplary costs on the department for negligence. 

High Court's Criticism and Directive 

During the hearing, the tax department assured the court of the refund payment, including interest, within 12 weeks. However, the court strongly criticised the department's negligence.  

It stated that the officers showed a callous attitude towards the taxpayer's grievance, which should have concerned senior officials. 

The court directed the tax department to release the refund amount of ₹5.37 crore, with applicable interest, by February 15, 2026. Failure to comply would result in the Deputy Commissioner of Income Tax personally paying ₹1 lakh to Microsoft India. 

Read More: Amazon Allows Remote Work for H-1B Staff Stranded in India Until March 2026! 

Conclusion 

The Delhi High Court's order for the Income Tax Department to refund ₹5.37 crore to Microsoft India, with interest, highlights the importance of timely tax refunds. The court's criticism underscores the need for accountability within the department to address taxpayer grievances promptly. 

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