HARI PRASAD NAIR vs. THE INCOME TAX OFFICER

WP(C)/5059/2024HC KeralaKLHC01080719202414 February 2024Author: HONOURABLE MR. JUSTICE D. K. SINGH4 pages

AI SummaryPartly Allowed

What did the High Court hold?

The High Court directed the petitioner to remit 20% of the assessed tax within two weeks. Upon compliance, the proceedings pursuant to the recovery notice (Ext.P4) would be kept in abeyance until the disposal of the appeal. The 2nd respondent (NFAC) was directed to dispose of the appeal expeditiously, preferably within six months. The court noted the significant delay of five years since the assessment order and the petitioner's admission of not paying any tax, leading to substantial interest liability. The writ petition was disposed of with these directions. The issue of whether the recovery notice was validly issued or enforceable in the interim was implicitly addressed by directing it to be kept in abeyance upon partial tax payment.

What were the facts?

The petitioner, Hari Prasad Nair, filed a writ petition seeking a direction to the National Faceless Appeal Centre (NFAC), Delhi, to dispose of his appeal and stay petition. The assessment order for assessment year 2017-18 was passed on December 24, 2019, under Section 143(3) of the Income Tax Act, 1961, with a tax demand of Rs. 50,90,879/-. The petitioner filed an appeal and a stay petition before the NFAC. While these were pending, a recovery notice was issued. The petitioner sought early disposal of his appeal and stay petition, and a stay on the recovery notice until a decision was reached. The High Court noted that five years had passed since the assessment order and no tax had been paid.

What were the issues?

1. Whether the High Court should issue a writ of mandamus directing the 2nd respondent (NFAC) to dispose of the petitioner's appeal and stay petition in a time-bound manner? (Question of law and fact, concerning the court's supervisory jurisdiction over quasi-judicial authorities). Assessee's Contention: The petitioner sought a direction for the early disposal of the stay petition and appeal by the NFAC. They also requested that the impugned recovery notice not be enforced until at least the stay petition was decided. Revenue's Contention: The judgment does not record any specific contentions from the revenue. The court's observations regarding the delay and non-payment of tax appear to be based on the facts presented and the petitioner's submissions.

Which sections of the Income-tax Act were involved?

Section 143(3)

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 WEDNESDAY, THE 14TH DAY OF FEBRUARY 2024 / 25TH MAGHA, 1945 WP(C) NO. 5059 OF 2024 PETITIONER/S: HARI PRASAD NAIR AGED 53 YEARS 1/ USHAS, AYNAMPADAM, NEMMARA, PALAKKAD, PIN - 678508 BY ADVS. HARISANKAR V. MENON MEERA V.MENON R.SREEJITH K.KRISHNA PARVATHY MENON PADMANATHAN K.V. RESPONDENT/S: 1 THE INCOME TAX OFFICER WARD 34(1)(4), INCOME TAX DEPARTMENT, 8TH FLOOR, KAUTILYA BHAVAN, C-41 TO C-43, G BLOCK, BANDRA KURLA COMPLEX, BANDRA (EAST) MUMBAI, PIN - 400051 2 NATIONAL FACELESS APPEAL CENTRE DELHI , REPRESENTED BY THE COMMISSIONER OF INCOME TAX (APPEALS)., PIN - 110001 3 THE INCOME TAX OFFICER WARD - 42(2)(3), ROOM NO. 804, KAUTILYA BHAVAN, C-41 TO C-43, G BLOCK, BANDRA KURLA COMPLEX, BANDRA (EAST), MUMBAI, PIN - 400051 BY ADV CHRISTOPHER ABRAHAM, INCOME TAX DEPARTMENT OTHER PRESENT: P.R AJITH KUMAR-SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 14.02.2024, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

JUDGMENT Dated this the 14th day of February, 2024 The present writ petition has been filed by the petitioner seeking the following reliefs: (i) To direct the 2nd respondent to dispose of Ext.P2 appeal and Ext.P3 stay petition by the issue of a writ of mandamus or such other writ or order or direction. (ii) To grant the petitioner such other incidental reliefs including the costs of these proceedings.

The assessment order in Ext.P1 got completed in respect of the assessment year 2017-18 on 24.12.2019 under Section 143(3) of the Income Tax Act, 1961. The tax amount assessed is Rs.50,90,879/-.

The petitioner being aggrieved by the said assessment order, has filed Ext.P2 appeal before the 2nd respondent along with Ext.P3 stay petition. While the appeal and the stay petition are pending consideration before this Hon’ble Court, impugned recovery notice in Ext.P4 has been issued.

Ms.Parvathy Menon, learned counsel for the petitioner submits that the petitioner is seeking only limited relief of direction to the 2nd respondent for early disposal of stay petition and appeal is still pending in a time bound manner and till the decision at least on the stay petition, the impugned recovery notice in Ext.P4 may not be enforced.

The assessment order is of 2019. We are in 2024. Five years have gone back. Admittedly, the petitioner has not paid any single penny in pursuance to the assessment order and the interest liability itself should have been more than the tax amount. In view thereof, I direct the petitioner to remit 20% of the assessed tax within a period of two weeks from today, and if the petitioner remits the 20% of the assessed tax, the proceedings in pursuance to Ext.P4 shall be kept in abeyance till disposal of the appeal. The 2nd respondent is directed to dispose of the appeal expeditiously, Preferably within a period of six months. With the aforesaid direction, the present writ petition stands finally disposed of. DINESH KUMAR SINGH JUDGE AP

Appendix — schedule of exhibits

APPENDIX OF WP(C) 5059/2024 PETITIONER EXHIBITS Exhibit P1 COPY OF ASSESSMENT ORDER ISSUED BY THE 1ST RESPONDENT FOR THE YEAR 2017-18 DTD. 24-12- 2019 Exhibit P2 COPY OF APPEAL FILED BY THE PETITIONER BEFORE THE 2ND RESPONDENT DTD. 04-02-2020 Exhibit P3 COPY OF STAY PETITION FILED BY THE PETITIONER BEFORE THE 2ND RESPONDENT DTD. NIL Exhibit P4 COPY OF NOTICE ISSUED BY THE 3RD RESPONDENT DTD. 12-01-2024

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