REMYA VIKRAMAN NAIR REMA DEVI vs. THE CENTRAL BOARD OF DIRECT TAXES

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WP(C)/11566/2024HC KeralaKLHC01093761202421 March 2024Author: HONOURABLE MR. JUSTICE D. K. SINGH5 pages
AI SummaryRemanded

What did the High Court hold?

The High Court of Kerala disposed of the writ petition by directing the 3rd respondent, the Commissioner of Income Tax (Appeals), to consider and pass an appropriate order on the stay petition (Ext.P3) expeditiously, preferably within a period of two months, in accordance with the law. The Court did not issue a specific direction to keep the recovery action in abeyance, but the expeditious disposal of the stay petition by the appellate authority would implicitly address the petitioner's concern regarding recovery. The primary focus of the Court's order was to ensure timely adjudication of the stay application by the appellate authority. The ratio decidendi is that when an appeal and stay petition are pending before the appellate authority, the High Court, in its writ jurisdiction, can direct the authority to dispose of the stay petition expeditiously to prevent undue hardship to the assessee.

What were the facts?

The petitioner, Remya Vikraman Nair Rema Devi, is an assessee under the Income Tax Act, 1961. For Assessment Year 2016-2017, the petitioner failed to file an income tax return. The Assessing Officer initiated reassessment proceedings under Section 147, believing income of Rs. 80,00,000/- from the sale of immovable property in FY 2015-2016 had escaped assessment. A notice under Section 148 was issued, but no return was filed. Notices under Sections 143(2) and 142(1) were also issued, with a reply filed only to the latter. The assessment was completed under Section 147 read with Section 144B on March 5, 2024, assessing capital gains at Rs. 80,00,000/- and demanding tax of Rs. 74,45,515/-. The petitioner filed an appeal (Ext.P2) and a stay petition (Ext.P3) before the Commissioner of Income Tax (Appeals). A demand notice for Rs. 42,00,705/- was issued due to the absence of an interim order.

What were the issues?

1. Whether the 3rd respondent (Commissioner of Income Tax (Appeals)) should be directed to consider and pass appropriate orders on the pending stay petition (Ext.P3) expeditiously, and if so, within what timeframe? 2. Whether the 2nd respondent (Additional Commissioner of Income Tax) should be directed to keep in abeyance recovery action pertaining to the assessment order (Ext.P1) during the pendency of the appeal and stay petition? Assessee's Contention: The petitioner sought a Writ of Mandamus directing the 3rd respondent to consider and pass orders on the appeal and stay application at the earliest, and alternatively, to direct the 2nd respondent to keep recovery action in abeyance. The petitioner's counsel ultimately submitted that they would be satisfied if the appellate authority was directed to consider the stay petition expeditiously. Revenue's Contention: The judgment does not record any specific arguments or contentions from the revenue.

Which sections of the Income-tax Act were involved?

Section 147,Section 148,Section 143(2),Section 142(1),Section 144B,Section 156

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE DINESH KUMAR SINGH THURSDAY, THE 21ST DAY OF MARCH 2024 / 1ST CHAITHRA, 1946 WP(C) NO. 11566 OF 2024 PETITIONER/S: REMYA VIKRAMAN NAIR REMA DEVI AGED 43 YEARS D/O VIKRAMAN NAIR MUDUMBIL PUTHENVEEDU, KARIKKAKOM, THIRUVANANTHAPURAM, PIN - 695007 BY ADVS. K.P.PRADEEP T.T.BIJU T.THASMI M.J.ANOOPA RESPONDENT/S: 1 THE CENTRAL BOARD OF DIRECT TAXES DEPARTMENT OF REVENUE, MINISTRY OF FINANCE, GOVERNMENT OF INDIA, NORTH BLOCK , NEW DELHI REPRESENTED BY ITS CHAIRMAN, PIN - 110001 2 ADDITIONAL COMMISSIONER OF INCOME TAX ASSESSMENT UNIT, INCOME TAX DEPARTMENT NATIONAL FACELESS ASSESSMENT CENTRE, DELHI ROOM NO. 401, 2ND FLOOR, E-RAMP,JAWAHARLAL NEHRU STADIUM, DELHI, PIN - 110003 3 COMMISSIONER OF INCOME TAX (APPEALS) NATIONAL FACELESS APPEAL CENTRE (NFAC), DELHI, ROOM NO. 401, 2ND FLOOR, E-RAMP,JAWAHARLAL NEHRU STADIUM, DELHI, PIN - 110003 BY ADVS. CHRISTOPHER ABRAHAM P.R.AJITH KUMAR(K/000708/1998) OTHER PRESENT: SRI. P.R. AJITH KUMAR-SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 21.03.2024, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

WP(C) NO. 11566 OF 2024 2 JUDGMENT Dated this the 21st day of March, 2024 The petitioner has filed this writ petition with the following prayers:- “i. To call for the records leading to issue Ext P1 assessment order issued by the 2nd respondent and Ext P2 appeal and Ext P3 stay application pending before 3rd respondent and issue a Writ of Mandamus, or any other writs or order or direction to the 3rd respondent or the appropriate authority to consider and pass appropriate orders in Ext P2 appeal or Ext P3stay application, pending before him, at the earliest or within a timeframe fixed by this Hon’ble Court considering the fact and circumstances of the case. ii. To call for the records leading to issue Ext P1 assessment order issued by the 2nd respondent and issue a Writ of Mandamus or any other writs or order or directions, to the 2nd respondent to keep in abeyance the recovery action pertains to Ext P1 assessment order issued for the Assessment year 2016-17, during the pendency of Ext P2 appeal or Ext P3 stay application. iii. Direct the respondents to pay cost of this proceedings.”

2.

The petitioner is an assessee under the provisions of the Income Tax Act, 1961 (‘the IT Act’ for short). The petitioner did not file his return of his income during the assessment year 2016-2017. As per the assessment order the petitioner had sold immovable property in the financial year 2015-2016 relevant to the assessment year 2016-2017 amounting to Rs. 80,00,000/-. On the basis of the information flagged, the assessing officer believed that the income of the WP(C) NO. 11566 OF 2024 3 petitioner amounting to Rs. 80,00,000/- had escaped assessment within the meaning of Section 147 of the IT Act. The petitioner was issued with a notice under Section 148 of the IT Act. However, the petitioner did not file any return in pursuance to the notice. The petitioner was also issued notices under Section 143(2) and 142(1), to which the petitioner filed his reply only to the notices issued under Section 142(1) and not to notice issued under Section 143(2).

3.

The assessing officer after considering the replies completed the assessment under Section 147 r/w Section 144B of the IT Act on 05.03.2024 in Ext.P1. Though the petitioner conceded capital gain of Rs. 5, 54,485/- but the assessing authority assessed the capital gain at Rs.80,00,000/-, and thus, demanded tax of Rs. 74,45,515/-. The petitioner has filed Ext.P2 appeal and Ext.P3 stay petition against the said assessment order. Notices have been issued to the petitioner under Section 156 of the IT Act, demanding sum of Rs. 42,00,705/- as there is no interim order by the appellate authority. Now the petitioner has approached this court with the aforesaid prayer.

4.

Dr. K.P Pradeep Kumar, the eminent counsel of this WP(C) NO. 11566 OF 2024 4 court, after some arguments submit that he would be satisfied if this court direct the appellate authority to consider the stay petition within time frame manners expeditiously. Considering the said prayer, the present writ petition is disposed of, directing the 3rd respondent to consider and pass appropriate order on stay petition expeditiously, preferably within a period of two months in accordance with the law. DINESH KUMAR SINGH JUDGE SJ

WP(C) NO. 11566 OF 2024 5

Appendix — schedule of exhibits
APPENDIX OF WP(C) 11566/2024 PETITIONER EXHIBITS Exhibit P1 TRUE COPY OF THE ASSESSMENT ORDER NO ITBA/AST/S/147/2023-24/1062059897(1) DATED 05-03-2024 ISSUED FOR THE YEAR 2016-17 BY THE 2ND RESPONDENT Exhibit P2 TRUE COPY OF THE APPEAL DATED 13-03-2024 FILED FOR THE YEAR 2016-17 BEFORE THE 3RDRESPONDENT BY THE PETITIONER Exhibit P3 TRUE COPY OF THE STAY PETITION DATED 13- 03-2024 SUBMITTED BY THE PETITIONER BEFORE THE 3RD RESPONDENT Exhibit P4 TRUE COPY OF THE DEMAND NOTICE NO. ITBA/AST/S/156/2023-24/1062059927(1) ISSUED UNDER SECTION 156 OF THE INCOME TAX ACT, 1961, FOR THE ASSESSMENT YEAR 2016-17 BY THE 2ND RESPONDENT TO THE PETITIONER

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