HINDUSTAN NEWSPRINT LTD. vs. INCOME TAX OFFICER(TDS)

WP(C)/31423/2019HC KeralaKLHC01082168201924 July 2024Bench: HONOURABLE MRS. JUSTICE SHOBA ANNAMMA EAPEN3 pages

AI SummaryDismissed

What did the High Court hold?

The High Court of Kerala, while considering the writ petition, recorded the submission made by the learned Standing Counsel for the respondent. The Standing Counsel stated that the liquidation proceedings had concluded and that the respondent had received an amount of ₹58,65,937/- through these proceedings from the Interim Resolution Professional (IRP). Crucially, the Standing Counsel submitted that since the IRP had settled the claim amount, the respondent was precluded from proceeding further against the petitioner. Based on this submission, the Court closed the writ petition. The primary reasoning for closing the petition was the respondent's acknowledgment that the claim had been settled by the IRP, thereby preventing further action against the petitioner. No specific issue was decided on merits; rather, the petition was disposed of based on the respondent's statement regarding the settlement of the claim.

What were the facts?

The petitioner, Hindustan Newsprint Ltd., filed a writ petition challenging a notice of demand dated November 4, 2019 (Ext.P2) issued by the Income Tax Officer (TDS). The petitioner sought to quash this demand notice and sought a direction for the respondent to consider their letter dated August 14, 2019 (Ext.P1). They also sought a direction to prevent enforcement of the demand until the National Company Law Tribunal (NCLT) passed a final order on a proposal submitted by the State Government in an interlocutory application. During the hearing, the Standing Counsel for the respondent submitted that liquidation proceedings had concluded, and a sum of ₹58,65,937/- was received by the respondent through these proceedings from the Interim Resolution Professional (IRP). The Standing Counsel stated that since the IRP had settled the claim amount, the respondent was precluded from proceeding further against the petitioner.

What were the issues?

1. Whether the notice of demand dated November 4, 2019 (Ext.P2) issued by the Income Tax Officer (TDS) is liable to be quashed, considering the petitioner's letter dated August 14, 2019 (Ext.P1) and the ongoing proceedings before the National Company Law Tribunal (NCLT)? (Question of law and fact, relating to the enforceability of the demand in light of insolvency proceedings). Assessee's Contention: The petitioner sought to quash the demand notice and prevent its enforcement pending the NCLT's decision on a proposal submitted by the State Government. They also sought a direction for the respondent to consider their earlier letter. Revenue's Contention: The Standing Counsel for the respondent submitted that liquidation proceedings were over, and the respondent had received ₹58,65,937/- through these proceedings from the Interim Resolution Professional (IRP). They argued that since the IRP had settled the claim amount, the respondent was precluded from proceeding further against the petitioner.

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MRS. JUSTICE SHOBA ANNAMMA EAPEN WEDNESDAY, THE 24TH DAY OF JULY 2024 / 2ND SRAVANA, 1946 WP(C) NO. 31423 OF 2019 PETITIONER: HINDUSTAN NEWSPRINT LTD. NEWSPRINT NAGAR P.O., VELLOOR, KOTTAYAM DISTRICT, KERALA-686616, REPRESENTED BY ITS HEAD OF DEPARTMENT (FINANCE). BY ADVS. V.KRISHNA MENON SRI.E.K.MADHAVAN SMT.P.VIJAYAMMA SMT.J.SURYA RESPONDENT: INCOME TAX OFFICER(TDS) OFFICE OF THE INCOME TAX OFFICER (TDS), PUBLIC LIBRARY BUILDING, L.B.SHASTRI ROAD, KOTTAYAM-686001. OTHER PRESENT: SRI. CHRISTOPHER ABRAHAM -STANDING COUNSEL THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 24.07.2024, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

W.P(C)NO.31423 OF 2019 :-2-: SHOBA ANNAMMA EAPEN,J ------------------------------------------------ W.P(C)NO.31423 OF 2019 - C ------------------------------------------------ Dated this the 24th day of July, 2024 J U D G M E N T The writ petition is filed seeking the following reliefs:- i) to issue a writ of certiorari or any other appropriate writ, order or direction calling for the records leading to issuance of the notice of demand dated 4.11.2019 evidenced by Ext.P2 and to quash Ext.P2. ii) to issue a writ of mandamus or any other appropriate writ, order or direction directing the respondent to consider and pass orders on the letter dated 14.8.2019 evidenced by Ext.P1; iii) to issue a writ of mandamus or any other appropriate writ, order or direction to direct the respondent not to enforce the demand made as per notice evidenced by Ext.P2 till the National Company Lw Tribunal Kochi Bench passes final order on the proposal submitted by the State Government in the interlocutory application with affidavit dated 7.11.2019 filed in TIBA No.3 of 2019. 2. Today when the case is taken up for hearing, the learned Standing Counsel for the respondent submits that liquidation proceedings were over and part of the amount was paid by the Interim Resolution Professional (IRP), and the respondent received an amount of ₹58,65,937/- through the proceedings. Since the IRP has settled the claim amount, the Standing Counsel submits that they are precluded from proceeding further against the petitioner. Recording the submission of the learned Standing Counsel for the respondent, the writ petition is closed. sd/-

SHOBA ANNAMMA EAPEN, JUDGE MBS/

W.P(C)NO.31423 OF 2019 :-3-: APPENDIX OF WP(C) 31423/2019 PETITIONER'S EXHIBITS:- EXHIBIT P1 TRUE COPY OF THE PETITION DATED 14.8.2019. EXHIBIT P2 TRUE COPY OF THE ORDER DATED 4.11.2019 PASSED BY THE RESPONDENT. EXHIBIT P3 TRUE COPY OF THE NOTICE OF DEMAND DATED 4.11.2019. EXHIBIT P4 TRUE COPY OF THE LETTER DATED 06.11.2019. EXHIBIT P5 TRUE COPY OF THE E-MAIL DATED 11.11.2019. EXHIBIT P6 TRUE COPY OF THE MINUTES OF THE MEETING HELD ON 15.11.2019.

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