THE KARAKURISSI SERVICE CO-OPERATIVE BANK LTD vs. THE INCOME TAX OFFICER,

WP(C)/13093/2019HC KeralaKLHC01032795201907 May 2019Author: HONOURABLE MRS. JUSTICE ANU SIVARAMAN4 pages

AI SummaryPartly Allowed

What did the High Court hold?

The High Court held that the appeal preferred by the petitioner institution is liable to be considered and disposed of on merits before proceeding with the recovery of amounts in terms of the assessment orders. Consequently, a direction was issued to the 3rd respondent appellate authority to take up, consider, and pass appropriate orders on Exhibit P2 appeal at the earliest, within three months from the date of receipt of a copy of the judgment. Until orders are passed on the appeal, coercive proceedings based on the original assessment order are to be kept in abeyance. The principle established is that statutory appeals should be adjudicated before enforcement of demands, and recovery actions should be stayed pending appeal resolution.

What were the facts?

The petitioner, Architectural Lighting Concept Private Limited, is a company that received an assessment order under the Income Tax Act. Aggrieved by this order, the petitioner filed a statutory appeal (Exhibit P2) and a stay petition (Exhibit P3) before the 3rd respondent, the Commissioner of Income Tax (Appeals). Despite the pending appeal, demands were being raised based on the assessment order. The petitioner approached the High Court of Kerala seeking a direction to consider their appeal before recovery proceedings are initiated.

What were the issues?

1. Whether the appellate authority should consider and dispose of the statutory appeal filed by the petitioner before proceeding with the recovery of amounts demanded in the assessment order? Assessee's Contention: The petitioner argued that demands were being raised in terms of the assessment orders, despite a statutory appeal and stay petition being filed. They sought a direction for the appeal to be considered and disposed of before any coercive recovery action is taken. Revenue's Contention: The judgment records that the learned standing counsel appearing for the respondents was heard. No specific arguments for the revenue are detailed in the judgment.

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances

WP(C).13193/19 1 IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MRS. JUSTICE ANU SIVARAMAN TUESDAY, THE 07TH DAY OF MAY 2019 / 17TH VAISAKHA, 1941 WP(C).No. 13193 of 2019 PETITIONER/S: ARCHITECTURAL LIGHTING CONCEPT PRIVATE LIMITED CURRENTLY AT NO. 47 FLAT A, ASHRAM AVENUE, PHASE 1, MAXIMUS, APARTMENT, MANAPAKKAM, CHENNAI 6000 125, REPRESENTED BY ITS DIRECTOR NISHANTH LUIZ. BY ADVS. SRI.M.GOPIKRISHNAN NAMBIAR SRI.JOSON MANAVALAN SRI.K.JOHN MATHAI SRI.KURYAN THOMAS SRI.PAULOSE C. ABRAHAM RESPONDENT/S: 1 THE UNION OF INDIA REPRESENTED BY THE SECRETARY MINISTRY OF FINANCE, DEPARTMENT OF REVENUE, NORTH BLOCK, NEW DELHI 110 001. 2 DEPUTY COMMISSIONER OF INCOME TAX CORPORATE CIRLCE 1 (1) C.R. BUILDING, I.S. PRESS ROAD, COCHIN 682 018. 3 THE COMMISSIONER OF INCOME TAX APPEALS, FIRST FLOOR, POORNIMA, 28/243, NEAR MANORAMA, JUNCTION, PANAMPILLY NAGAR, KOCHI 682 036. 4 TAX RECOVERY OFFICER, CORPORATE, 3RD FLOOR, 304, C.R. BUILDING, I.S. PRESS ROAD, COCHIN 682 018. OTHER PRESENT: SRI JOSE JOSEPH- STANDING COUNSEL THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 07.05.2019, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C).13193/19 2 ANU SIVARAMAN, J. ----------------------------------------------- W.P(C).No. 13193 of 2019 ----------------------------------------------- Dated this the 7th day of May, 2019

JUDGMENT Petitioner is a Private Limited Company which has been issued with assessment order under the Income Tax Act. Being aggrieved by the assessment order, the petitioner has preferred statutory appeal, Exhibit P2, before the 3rd respondent appellate authority under the Income Tax Act. They have also preferred Exhibit P3 stay petition in the appeal. However, it is contended that demands are being raised in terms of the assessment orders.

Having heard the learned counsel for the petitioner as well as the learned standing counsel appearing for the respondents, I am of the opinion that the appeal preferred by the petitioner institution is liable to be considered and disposed of on merits before proceeding with the recovery of amounts in terms of the orders passed by the assessment authority. In the above view of the matter, there will be a direction to the 3rd respondent appellate authority to take up consider and pass appropriate orders on Exhibit P2 appeal preferred by the petitioner and to dispose of the same in accordance with law at the earliest, at any rate, within three months from the date of receipt of a copy of this judgment. Till orders are passed on the appeal, as directed above, coercive proceedings on the basis of the original order shall be kept in abeyance. Writ petition is ordered accordingly.

ANU SIVARAMAN JUDGE vgs7/5

Appendix — schedule of exhibits

APPENDIX PETITIONER'S/S EXHIBITS: EXHIBIT P1 THE TRUE COPY OF THE ORDER OF ASSESSMENT DATED 31.12.2018 ISSUED BY THE 2ND RESPONDENT, RELATING TO THE ASSESSMENT YEAR 2016-17. EXHIBIT P2 A TRUE COPY OF THE APPEAL MEMORANDUM WITHOUT ANNEXURES, DATED 28.1.2019 FILED BY THE PETITIONER BEFORE THE 3RD RESPONDENT. EXHIBIT P3 A TRUE COPY OF THE STAY PETITION DATED 24.4.2019 FILED BY THE PETITIONER BEFORE THE 3RD RESPONDENT. EXHIBIT P4 A TRUE COPY OF THE NOTICE DATED 12.4.2019 ISSUED BY THE 4TH RESPONDENT TO THE PETITIONER.

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