Tax refund witheld - suggestion requested!

@ justacommonman:

I have some doubts. Please clarify.

1. Is there an employer-employee relationship or that of clients consultant relationship. The reason behind asking is had it been employers employee relationship then form16 would be issued to you and there would not be any tax dues only as the tds will be deducted according to the salary earned. In that case, tax paid would already be more as you failed to disclose investments to your employer.

And if it is clients consultant relationship then form 16A will be issued to you and in such case (form 16A), you are not required to disclose investments made. That you need to directly disclose in itr and in such case, itr1 is not applicable.

2. According to me, It is very wrong to make a statement that it dept is sleeping. From this statement I make myself clear that I m not supporting it dept here. But where mistake is made by you, you cannot put the blame on IT Dept to rectify it on your behalf, especially when it is not as per the provisions of IT act. IT dept sent you an intimation, in turn applying for rectification, you tried sending the itrv to CPC. Again when you saw that the itr v recd is delayed, you construed that your itrv is accepted, which is not the case. It meant that itrv is not accepted due to delay in filing return. (I.e sending itrv to cpc). Instead of going for rectification u/s 154, you went for response to o/s demand. When you took so long to check the details, how can you blame others?

Now coming to the remedial measure, I agree as suggested by S.Shiroor. Apart from that what I would suggest is to personally or some competent person like CA on behalf of you approach the AO of the Bangalore jurisdiction to escalate the issue. 

Hope you find this in order

@ Anil Kumar:

His case is not that strong that he needs to do all such process. The AO can also levy penalty and interest provisions. So no need to be hasty in decisions. Where he was subject to demand of 6500 only, he will be subjected to pay more. So let it go slow and smooth. Remember mistake is made by assessee

Lack of knowledge is there with so many assesse. Taxman also thinks assesse must know all laws.

The moment one gets demand notice that means his IT return is assessed. He must have received 143(1) either by email  or snail mail.

But IT dept is also culprit. They never gave me my 2009-10 assesment info and kept on taking refunds from 2010-11 , 11-12 and 12-13. After taking last instalment of tax from 2012-13 they sent me a notice u/s 245 that they are taking refunds from 2012-13 as demanded by Jur AO probably after delhi HC judgement to send notices to assesse b4 taking refunds from other years.

 Mr Common man as soon as you get intimation u/s 143(1) post here - so that further advice can be given. 

most probably CPC thought you have send ITR-V by ordinary post and it is mispaced in CPC.  Hence they assessed the return and send demand for 6.5k