ROBIN KUNJAPPY JOY vs. THE CENTRAL BOARD OF DIRECT TAXES

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WP(C)/1863/2023HC KeralaKLHC01004612202325 January 2023Author: HONOURABLE MR. JUSTICE GOPINATH P.5 pages
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What did the High Court hold?

The High Court of Kerala disposed of the writ petition by directing that if the petitioner files a stay petition before the National Faceless Appeal Centre within three weeks from the date of the order, any demand arising from the assessment order (Ext.P1) shall be kept in abeyance until the Appellate Authority decides on the stay petition. The court also provided a mechanism for assistance if the petitioner faced difficulties uploading the stay petition, directing the jurisdictional Assessing Officer to help. The benefit of this judgment is contingent on the petitioner filing the stay petition within the stipulated three-week period; failure to do so would result in the loss of this benefit. The court did not decide on the merits of the assessment order or the ultimate grant of stay, but rather facilitated the procedural filing of a stay petition.

What were the facts?

The petitioner, Robin Kunjappy Joy, proprietor of M/s. RR Business Group, is challenging an order of assessment for the assessment year 2017-18. He filed an appeal before the National Faceless Appeal Centre (NFAC) against this order. The petitioner approached the High Court of Kerala apprehending recovery proceedings while his appeal was pending. The Income Tax Department's counsel noted that the petitioner had not filed a stay petition along with his appeal at the NFAC. A subsequent stay petition filed before the Assessing Officer was rejected (Ext.P6) because the petitioner had not remitted 20% of the demand, a condition stipulated under Section 220(6) of the Income Tax Act, 1961.

What were the issues?

1. Whether the petitioner is entitled to a stay of recovery proceedings pending his appeal before the National Faceless Appeal Centre, despite not having filed a stay petition along with the appeal and not having remitted 20% of the demand as per Section 220(6) of the Income Tax Act, 1961. Assessee's Contention: The petitioner sought to prevent recovery proceedings while his appeal was pending before the NFAC. The judgment does not record specific arguments made by the petitioner's counsel regarding the legal basis for the stay, but rather focuses on the procedural steps and the court's directive. Revenue's Contention: The revenue, through its Standing Counsel, pointed out that the petitioner had not filed a stay petition with his appeal and that a subsequent stay petition was rejected by the Assessing Officer due to non-compliance with the 20% pre-deposit requirement under Section 220(6) of the Income Tax Act, 1961.

Which sections of the Income-tax Act were involved?

Section 220(6)

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances
IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE GOPINATH P. WEDNESDAY, THE 25TH DAY OF JANUARY 2023 / 5TH MAGHA, 1944 WP(C) NO. 1863 OF 2023 PETITIONER: ROBIN KUNJAPPY JOY, AGED 37 YEARS, S/O KUNJAPPY , PROP. OF M/S. RR BUSINESS GROUP, VALAKOM P.O KOTTARAKKARA RESIDING AT ABY BHAVAN, VALAKOM P.O, KOTTARAKKARA – 691 532. BY ADVS. RASMI NAIR T. G.G.ABHILASH RESPONDENTS: 1 THE CENTRAL BOARD OF DIRECT TAXES, DEPARTMENT OF REVENUE, MINISTRY OF FINANCE, GOVERNMENT OF INDIA, NORTH BLOCK, NEW DELHI – 110 001, REPRESENTED BY IT'S CHAIRMAN. 2 INCOME TAX OFFICER, WARD 2, AAYAKKAR BHAVAN, KARBALA JUNCTION, KOLLAM DISTRICT, PIN – 691 001. 3 COMMISSIONER OF INCOME TAX (APPEALS), THIRUVANTHAPURAM, AAYAKAR BHAVAN, PEROORKADA ROAD, KOWDIAR, THIRUVANTHAPURAM – 695 003. BY ADV JOSE JOSEPH, SC, INCOME TAX DEPARTMENT, KERALA THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 25.01.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WPC No.1863 of 2023 2

JUDGMENT The petitioner suffered Ext.P1 order of assessment for the assessment year 2017-18 under the provisions of the Income Tax Act, 1961. Being aggrieved by the order of assessment, the petitioner has filed an appeal before the National Faceless Appeal Centre. The petitioner has approached this Court apprehending that recovery proceedings may be initiated against him to recover amounts due under Ext.P1 order of assessment pending the appeal.

2.

Learned Standing Counsel appearing for the respondent Department would point out that the petitioner did not file any stay petition along with appeal before the National Faceless Appeal Centre and the petitioner filed Ext.P4 stay petition which was considered by the Assessing Officer and disposed of by Ext.P6 order finding that stay cannot be granted as the petitioner has not remitted 20% of the demand as a condition for stay under Section 220(6) of the Income Tax Act, 1961. It is submitted that if the petitioner files a stay petition in the appeal within a period of two weeks from today, the demand can be kept in abeyance till a decision is taken by the Appellate Authority on the stay petition to be filed by the petitioner. Having regard to the submissions made, the writ petition will stand disposed of directing that if the petitioner files a stay petition before the National Faceless Appeal Centre in Ext.P3 appeal within a period of three weeks from today, any demand against the petitioner pursuant to Ext.P1 order of assessment shall be kept in abeyance till a decision is taken on the stay petition by the Appellate Authority. If the petitioner faces any difficulty in uploading a stay petition, the petitioner may approach the juri ictional Assessing Officer, who shall assist the petitioner in uploading the stay petition to the National Faceless Appeal Centre. If the petitioner fails to file a stay petition within a period of three weeks from today, the petitioner will lose the benefit of this judgment. GOPINATH P. JUDGE DK

Appendix — schedule of exhibits
APPENDIX OF WP(C) 1863/2023 PETITIONER’S EXHIBITS: EXHIBIT P1 TRUE COPY OF THE ASSESSMENT ORDER ITBA/AST/S/144/2019-20/1021950051 (1) ALONG WITH COMPUTATION SHEET ISSUED FOR THE YEAR 2017-18 DATED 09-12-2019 BY THE 2ND RESPONDENT TO THE PETITIONER EXHIBIT P2 TRUE COPY OF THE INCOME TAX RETURN DATED 20-12-2019 FOR THE ASSESSMENT YEAR 2017-18 IN PAN NO. AOWPR8853A FILED BY THE PETITIONER EXHIBIT P3 TRUE COPY OF THE APPEAL DATED 01.01.2020 FILED FOR THE YEAR 2017-18 BEFORE THE 3RD RESPONDENT ALONG WITH CHALLAN NO 280 BY THE PETITIONER EXHIBIT P4 TRUE COPY OF THE STAY APPLICATION FILED ON 27-02-2020 BEFORE THE 3RD RESPONDENT IN EXT. P3 APPEAL BY THE PETITIONER EXHIBIT P5 TRUE COPY OF THE DEMAND NOTICE NO. ITBA/AST/S/156/2019-20/1021950270(1) DATED 09-12-2019 ISSUED FOR THE YEAR 2017-18 BY THE 2ND RESPONDENT TO THE PETITIONER EXHIBIT P6 TRUE COPY OF THE REJECTION OF STAY APPLICATION NO. ITBA/COM/F/17/2019- 20/1026001509(1) DATED 02-03-2020 ISSUED FOR THE YEAR 2017-18 BY THE 2ND RESPONDENT TO THE PETITIONER

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