“9. The petitioner has raised concerns about the non-disposal of their applications dated 24.11.2023 and 30.08.2024, requesting the issue of the outstanding income-tax refund along with interest for the assessment year 2015-16. While this delay in response is acknowledged, it is essential to note that the failure to dispose of these applications within a short time frame does not automatically suggest negligence or mala fide actions on the part of the department. Delays can often occur in the processing of applications due to factors such as backlogs, technical issues, or administrative delays, and this is especially relevant when the department is already addressing a larger backlog of cases or dealing with technical glitches that affect the refund process. It is important to refer to the case of UCO Bank vs. CIT (1999) 237 ITR 889 (SC), where the Supreme Court held that the department's delays, even in processing returns or addressing follow-up applications, are not always indicative of negligence. The Court emphasized that the department is not automatically liable for immediate action or compensation unless the delay can be shown to be due to gross negligence or a lack of due process. In this case, the technical nature of the delay and the department's application for condonation suggest that the delay is not willful.”
