M/S. WEXCO HOMES PRIVATE LTD. vs. THE ASSISTANT COMMISSIONER OF INCOME TAX

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WP(C)/3483/2024HC KeralaKLHC01077331202402 February 2024Bench: HONOURABLE MR. JUSTICE D. K. SINGH4 pages
AI SummaryDismissed

What did the High Court hold?

The High Court found no grounds to entertain the writ petition on the stated facts. The court dismissed the writ petition. However, it directed the 2nd respondent (Commissioner of Income Tax (Appeals)) to consider the stay petition expeditiously, preferably within four months. The court explicitly stated that no interim order was passed by it staying the recovery or penalty proceedings. The ratio decidendi is that a writ petition for stay of demand is not the appropriate remedy when the assessee has delayed in filing a stay application before the appellate authority and has not deposited any tax, especially when the appellate authority is yet to consider the stay petition.

What were the facts?

The petitioner, M/s. Wexco Homes Private Ltd., is a private limited company. A search was conducted under Section 132 of the Income Tax Act at its business premises. The assessment for assessment year 2009-2010 was completed on December 31, 2016, under Section 143(3) read with Section 147, assessing a total income of Rs. 6,67,92,468/- and tax of Rs. 4,27,12,820/-. The petitioner did not deposit any part of this assessed tax. An appeal was filed in 2017 without a stay application. Penalty proceedings under Section 271A were initiated, and recovery proceedings are ongoing. The petitioner recently filed a stay petition before the Appellate Authority and approached the High Court seeking a direction to stay the demand.

What were the issues?

1. Whether the High Court should entertain a writ petition seeking a stay on demand when the petitioner has not deposited any tax and has recently filed a stay petition before the appellate authority after a considerable delay? Assessee's Contention: The petitioner sought a direction from the High Court to stay the demand. No specific arguments or reliance on authorities are recorded for the petitioner's side in the judgment. Revenue's Contention: The judgment does not record any specific arguments made by the revenue. However, the court's dismissal of the writ petition implies a lack of merit in the petitioner's plea based on the facts presented.

Which sections of the Income-tax Act were involved?

Section 132,Section 143(3),Section 147,Section 271A

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 FRIDAY, THE 2ND DAY OF FEBRUARY 2024 / 13TH MAGHA, 1945 WP(C) NO. 3483 OF 2024 PETITIONER/S: M/S. WEXCO HOMES PRIVATE LTD. PARAYIL HOUSE, THELLAKAM P.O,. KOTTAYAM, REPRESENTED BY ITS MANAGING DIRECTOR, P.H. BABU ANSARI, PIN - 686630 BY ADVS. HARISANKAR V. MENON MEERA V.MENON R.SREEJITH K.KRISHNA PARVATHY MENON RESPONDENT/S: 1 THE ASSISTANT COMMISSIONER OF INCOME TAX INCOME TAX DEPARTMENT, CENTRAL CIRCLE, AAYAKAR BHAVAN RAILWAY STATION ROAD KOLLAM, PIN - 691001 2 THE COMMISSIONER OF INCOME TAX (APPEALS) APPEAL (3), C.R. BUILDING, I.S. PRESS ROAD, ERNAKULAM, KOCHI, PIN - 682018 OTHER PRESENT: SUSIE B. VARGHESE-SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 02.02.2024, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

WP(C)No.3483 of 2024 2 JUDGMENT Dated this the 2nd day of February, 2024 The petitioner is a private limited company registered under the provisions of the Companies Act. A search was conducted within the business premises of the petitioner under Section 132 of the Income Tax Act. The assessment proceedings for the assessment year 2009-2010 got completed vide Ext.P1 order dated 31.12.2016 under the provisions of Section 143(3) read with Section 147 of the Income Tax Act, 1961. The total income which was assessed in the hands of the petitioner was Rs.6,67,92,468/- and on which the due tax had been assessed at Rs.4,27,12,820/-. The petitioner has not deposited a single penny on the said tax assessed vide assessment order dated 31.12.2016. Against the said assessment order, the petitioner has filed appeal in 2017 but without any stay application. The penalty proceedings have been initiated under Section 271A against the petitioner, and the petitioner is facing recovery proceedings. At this stage, the petitioner has filed the stay petition recently before the

WP(C)No.3483 of 2024 3 Appellate Authority. However, the petitioner has approached this Court seeking a direction to stay the demand. This Court finds absolutely no ground to entertain this writ petition on the facts stated above. Therefore, the writ petition is dismissed. However, the 2nd respondent is directed to consider the stay petition expeditiously, preferably within a period of four months. It is made clear that no interim order has been passed by this Court staying the recovery or the penalty proceedings. Sd/- DINESH KUMAR SINGH AP JUDGE

WP(C)No.3483 of 2024 4 APPENDIX OF WP(C) 3483/2024 PETITIONER EXHIBITS Exhibit P1 COPYOF ASSESSMENT ORDER FOR THE YEAR 2009-10 ISSUED BY THE 1ST RESPODNENT DTD. 31-12-2016 Exhibit P2 COPY OF APPEAL FILED BY THE PETITIONER BEFORE THE 2ND RESPONDENT FOR THE THE YEAR 2009-10 DTD. 27-01-2017 Exhibit P3 COPY OF STAY PETITION FILED BY THE PETITIONER BEFORE THE 2ND RESPONDENT FOR THE YEAR 2009-10 DTD. 23-01-2024

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