M.P. Industrial Development Corporation Ltd. vs. Asst. Commissioner Of Income Tax

WP/24685/2024HC Madhya Pradesh27 August 2024Bench: HON'BLE SHRI JUSTICE SUSHRUT ARVIND DHARMADHIKARI2 pages

For Petitioner: Manoj MunshiFor Respondent: Advocate General

AI SummaryRemanded

What did the High Court hold?

The High Court, considering the pendency of the appeal for over 1.5 years and the Supreme Court's order in SLP No.12272/2023, disposed of the writ petition with specific directions. The court directed the Revenue Authorities to decide the application for waiver of pre-deposit and the application for urgent hearing expeditiously, preferably within one month from the receipt of the certified copy of the order, and to pass a reasoned and speaking order. Furthermore, no coercive action was to be taken against the petitioner until then. The Revenue Authorities were also directed to decide the pending appeal itself, without further delay, as expeditiously as possible, preferably within three months from the receipt of the certified copy of the High Court's order. The ratio is that in cases of extreme delay and hardship, and where appellate authorities fail to act on Supreme Court directions, the High Court may intervene to ensure timely adjudication and prevent irreparable harm, while still emphasizing the need for the appellate process to conclude.

What were the facts?

The petitioner, M.P. Industrial Development Corporation Ltd., filed a writ petition challenging a garnishee order dated 14.08.2024. This order directed the withdrawal of Rs.94.53 crores for Income Tax recovery and Rs.472.69 crores for penalty. The petitioner had previously filed an appeal, as permitted by the Supreme Court in SLP No.12272/2023, which has been pending for over 1.5 years. The appellate authority had not decided the petitioner's application for waiver of pre-deposit or its application for urgent hearing, despite directions from the Supreme Court. Meanwhile, the respondent revenue had already withdrawn Rs.37.00 crores from the petitioner's bank account, causing financial difficulties. The petitioner sought directions from the High Court.

What were the issues?

1. Whether the High Court should entertain a writ petition at an interlocutory stage when an alternative remedy of appeal is pending before the appellate authority, and if so, what directions are necessary given the circumstances? (Mixed question of law and fact, concerning the maintainability of writ jurisdiction and the principles of equity and urgency). Assessee's Contentions: - The petitioner argued that the writ petition was maintainable due to the inordinate delay in the appellate proceedings and the failure of the appellate authority to decide crucial applications for waiver of pre-deposit and urgent hearing, despite Supreme Court directions. - The petitioner highlighted the immediate financial hardship caused by the revenue's coercive action of withdrawing Rs.37.00 crores. Revenue's Contentions: - The respondent revenue objected to the maintainability of the writ petition at the interlocutory stage, arguing that such petitions are not permissible when an alternative remedy is available. - The revenue prayed for time to seek instructions in the matter.

Which sections of the Income-tax Act were involved?

Article 226

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF MADHYA PRADESH AT JABALPUR BEFORE HON'BLE SHRI JUSTICE SUSHRUT ARVIND DHARMADHIKARI & HON'BLE SMT. JUSTICE ANURADHA SHUKLA ON THE 27th OF AUGUST, 2024 WRIT PETITION No. 24685 of 2024 M.P. INDUSTRIAL DEVELOPMENT CORPORATION LTD. Versus ASST. COMMISSIONER OF INCOME TAX Appearance: Shri Manoj Munshi - Advocate for the petitioner. Shri H.S. Gupta - Advocate for the respondent through video conferencing. ORDER Per: Justice Sushrut Arvind Dharmadhikari Heard on the question of admission. 2. In this petition under Article 226 of the Constitution of India, order dated 14.08.2024 (Annexure P/1) has been challenged which is a garnish order for withdrawing the sum of Rs.94.53 crores towards recovery of Income Tax and penalty of Rs.472.69 crores. 3. Learned counsel for the petitioner submitted that the petitioner has already availed the alternative remedy of filing an appeal as per liberty granted by the Apex Court in Special Leave to Appeal No.12272/2023 order dated 05.07.2023 which is pending before the appellate authority for more than one and half year. Even the appellant authority has not decided the application for waiver of pre-deposit as per the directions of the Apex Court in SLP No.12272/2023 vide order dated 05.07.2023 as well as the application for urgent hearing filed in the month of January, 2024. The respondent without deciding these applications has 1 WP-24685-2024 NEUTRAL CITATION NO. 2024:MPHC-JBP:42555 Signed by: ASHISH KOSHTA Signing time: 28-08-2024 12:44:20 Signature Not Verified (SUSHRUT ARVIND DHARMADHIKARI) JUDGE (ANURADHA SHUKLA) JUDGE already withdrawn the amount of Rs.37.00 crores from the bank account of the petitioner due to which the petitioner Corporation is facing difficulties in disbursing the salary and other expenses. Hence, this petition has been filed for seeking directions. 4. On the other hand, learned counsel for the respondent revenue prayed for time to seek instructions in the matter and vehemently objected to the prayer made by the petitioner on the ground that such petitions are not maintainable at the interlocutory stage. Therefore, this petition deserves to be dismissed. 5. Heard the learned counsel for both the parties. 6. Taking into consideration the order passed by the Apex Court in SLP No.12272/2023 dated 05.07.2024, this petition is disposed of with a direction to the Revenue Authorities to decide the application for waiver of pre-deposit as well as application for urgent hearing as expeditiously as possible preferably within a period of one month from the date of receipt of certified copy of this order and pass a reasoned and speaking order. 7. Till then, no coercive action be taken against the petitioner. 8. In view of the fact that the appeal is pending for last one and half year, the Revenue Authorities are directed to decide the appeal, without wasting any further time, as expeditiously as possible preferably within a period of three months from the date of receipt of certified copy of this Court. 9. With the aforesaid directions, this petition stands disposed off. ak 2 WP-24685-2024 NEUTRAL CITATION NO. 2024:MPHC-JBP:42555 Signed by: ASHISH KOSHTA Signing time: 28-08-2024 12:44:20 Signature Not Verified

Recent GST High Court judgments

Search GST case law →