Somatheeram Research Institute and Ayurveda Hospital Pvt. Ltd., vs. 1. Additional/Joint/Deputy/Assistant Commissioner of Income Tax/Income-tax Officer

WP(C)/364/2023HC KeralaKLHC01000913202306 January 2023Author: HONOURABLE MR. JUSTICE GOPINATH P.6 pages

AI SummaryPartly Allowed

What did the High Court hold?

The High Court of Kerala, considering the limited relief sought, disposed of the writ petitions. It directed the appellate authority to consider and dispose of the stay petitions filed by the petitioner against the order of assessment and the order imposing penalty without delay. Crucially, the Court ordered that until orders are passed on these stay petitions, any steps for recovery of amounts due under the assessment order and the penalty order for the assessment year 2018-19 shall be kept in abeyance. The ratio decidendi is that in the interim period before a decision on stay applications by the appellate authority, coercive recovery measures should be suspended to protect the assessee's interests.

What were the facts?

The petitioner, M/s. Somatheeram Research Institute and Ayurveda Hospital Pvt. Ltd., is challenging an order of assessment and an order imposing penalty for the assessment year 2018-19. The petitioner has filed appeals against these orders before the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), along with applications for stay. The petitioner apprehends that recovery proceedings might be initiated for the amounts due under the assessment and penalty orders while the stay petitions are pending. These writ petitions were filed before the High Court of Kerala seeking a direction to keep recovery steps in abeyance until the appellate authority decides the stay petitions.

What were the issues?

1. Whether the recovery proceedings for amounts due under an order of assessment and an order imposing penalty should be kept in abeyance pending the decision on stay petitions filed by the assessee before the appellate authority? (Question of law and procedure) The assessee argued that recovery steps should be halted until their stay applications are considered by the appellate authority, as they apprehend coercive action. The revenue did not record any specific arguments against this plea in the judgment.

AI-generated summary — verify with the full judgment below

Heard together (2 matters)

WP(C) NO. 376 OF 2023

WP(C) NO. 364 OF 2023

Read from the judgment's own cause title. This page is filed under one of them.

Cause title — parties, addresses and appearances

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE GOPINATH P. FRIDAY, THE 6TH DAY OF JANUARY 2023 / 16TH POUSHA, 1944 WP(C) NO. 376 OF 2023 PETITIONER: M/S. SOMATHEERAM RESEARCH INSTITUTE AND AYURVEDA HOSPITAL PVT. LTD., P K VI/1332, CHOWARA P.O., THIRUVANANTHAPURAM, REPRESENTED BY BABY MATHEW, MG. DIRECTOR BY ADVS. P.S.SOMAN T.RADHAMONY B.PRABHAKARAN NANCY PRABHAKAR RESPONDENTS: 1 ADDITIONAL/JOINT/DEPUTY/ASSISTANT COMMISSIONER OF INCOME TAX/INCOME-TAX OFFICER, NATIONAL FACELESS ASSESSMENT CENTRE, NORTH BLOCK, NEW DELHI – 110 001. 2 COMMISSIONER OF INCOME TAX (APPEALS), NATIONAL FACELESS ASSESSMENT CENTRE (NFAC), C BLOCK, 4TH FLOOR, S P M CIVIC CENTRE, NEW DELHI – 110 001. BY SRI.CHRISTOPHER ABRAHAM, SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 06.01.2023 ALONG WITH WP(C) NO. 364 OF 2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C) NOS. 376 & 364 OF 2023 2 IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE GOPINATH P. FRIDAY, THE 6TH DAY OF JANUARY 2023 / 16TH POUSHA, 1944 WP(C) NO. 364 OF 2023 PETITIONER: SOMATHEERAM RESEARCH INSTITUTE AND AYURVEDA HOSPITAL PVT. LTD., P K VI/1332, CHOWARA P.O., THIRUVANANTHAPURAM REPRESENTED BY BABY MATHEW, MG. DIRECTOR. BY ADVS. P.S.SOMAN T.RADHAMONY B.PRABHAKARAN NANCY PRABHAKAR RESPONDENTS: 1 ADDITIONAL/JOINT/DEPUTY/ASSISTANT COMMISSIONER OF INCOME TAX/INCOME-TAX OFFICER, NATIONAL E- ASSESSMENT CENTRE, NORTH BLOCK, NEW DELHI – 110 001. 2 COMMISSIONER OF INCOME TAX (APPEALS), NATIONAL FACELESS APPEAL CENTRE (NFAC), C BLOCK, 4TH FLOOR, S P M CIVIC CENTRE, NEW DELHI – 110 001. ADV. CHRISTOPHER ABRAHAM (SC) THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 06.01.2023 WP(C) NO. 376 OF 2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C) NOS. 376 & 364 OF 2023 3

JUDGMENT The petitioner in these cases is common. The petitioner suffered an order of assessment and an order imposing penalty for the assessment year 2018-19 under the provisions of the Income Tax Act, 1961. The petitioner has filed appeals against an order of assessment and the order imposing penalty along with applications for stay. The petitioner apprehends that proceedings may be taken to recover amounts due under the order of assessment and the order imposing penalty, pending consideration of the stay petitions by the appellate authority. The learned counsel for the petitioner prays that the recovery steps may be kept in abeyance till the stay petitions are decided by the appellate authority.

Heard the learned Standing Counsel also.

Having regard to the limited nature of relief sought for in these writ petitions, these writ petitions will stand disposed of directing that the stay petitions filed by the petitioner in the appeal filed against the order of assessment and the order imposing penalty shall be considered and WP(C) NOS. 376 & 364 OF 2023 4 disposed of by the appellate authority without delay. Till such time as orders are passed on those stay petitions, any steps for recovery of amounts due under the order of assessment and the order of penalty for the assessment year 2018-19 shall be kept in abeyance. GOPINATH P. JUDGE DK

WP(C) NOS. 376 & 364 OF 2023 5

Appendix — schedule of exhibits

APPENDIX OF WP(C) 376/2023 PETITIONER EXHIBITS Exhibit P1 TRUE COPY OF THE ASSESSMENT ORDER NO. ITBA/AST/S/143(3)/2020- 21/1031555982(1) DATED 17-03-2021 ISSUED BY THE 1ST RESPONDENT FOR THE ASSESSMENT YEAR 2018-19 Exhibit P2 TRUE COPY OF THE DEMAND NOTICE NO. ITBA/AST/S/156/2020-21/1031556146(1) DATED 17-03-2021 ISSUED BY THE 1ST RESPONDENT FOR THE ASSESSMENT YEAR 2018-19 Exhibit P3 TRUE COPY OF THE PENALTY ORDER NO. ITBA/PNL/F/270A/2021-22/1037824020(1) DATED 15-12-2021 ISSUED BY THE 1ST RESPONDENT FOR THE ASSESSMENT YEAR 2018-19. Exhibit P4 TRUE COPY OF THE DEMAND NOTICE NO. ITBA/PNL/S/156/2021-22/1037824106(1) DATED 15-12-2021 ISSUED BY THE 1ST RESPONDENT FOR THE YEAR 2018-19 Exhibit P5 TRUE COPY OF THE APPEAL MEMORANDUM ALONG WITH STAY PETITION FILED BEFORE THE 2ND RESPONDENT FOR THE YEAR 2018- 19 DATED 25-05-2022 WP(C) NOS. 376 & 364 OF 2023 6 APPENDIX OF WP(C) 364/2023 PETITIONER EXHIBITS Exhibit P1 TRUE COPY OF THE ASSESSMENT ORDER NO. ITBA/AST/S/143(3)/2020- 21/1031555982(1) DATED 17-03-2021 ISSUED BY THE 1ST RESPONDENT FOR THE ASSESSMENT YEAR 2018-19 Exhibit P2 TRUE COPY OF THE DEMAND NOTICE NO. ITBA/AST/S/156/2020-21/1031556146(1) DATED 17-03-2021 ISSUED BY THE 1ST RESPONDENT FOR THE ASSESSMENT YEAR 2018-19 Exhibit P3 TRUE COPY OF THE APPEAL MEMORANDUM ALONG WITH STAY PETITION FILED BEFORE THE 2ND RESPONDENT FOR THE YEAR 2018- 19 DATED 24-05-2022

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