THRISSUR DISTRICT POLICE CO-OPERATIVE SOCIETY LTD. vs. ADDITIONAL/JOINT/DEPUTY/ASSISTANT COMMISSIONER OF INCOME TAX

The learned counsel appearing for the petitioner states that since Ext.P2 order has been issued without affording to the petitioner an opportunity of hearing and also considering the fact that the 2nd respondent has not decided the amount to be paid by the petitioner as a condition for stay, Ext.P2 order is liable to be set aside and the matter is to be remanded to the 2nd respondent for consideration of the stay petition afresh.

The learned standing counsel appearing for the respondent department refers to Ext.P2 order and points out that the contentions raised by the learned counsel for the petitioner are not correct. He points out that the 2nd respondent has considered the matter in extenso and has reached a conclusion that the demands against the petitioner can be stayed pending consideration of the appeal on condition that the petitioner remits an amount equivalent to 20% of the demand after excluding amounts which are claimed to be 'double taxation' and also excluding the amounts relatable to deductions under 80P of the Income Tax Act, 1961. It is submitted that it is only for the purposes of calculating the exact amount payable by the petitioner that the matter has been sent to the assessing officer. It is submitted that there is absolutely nothing wrong in Ext.P2 order and the petitioner has no real grievance in the matter. It is also pointed out that even if the opportunity of oral hearing has not been extended to the petitioner, the 2nd respondent had considered the written submissions made by the petitioner while considering the stay petition.

Having heard the learned counsel appearing for the petitioner and the learned standing counsel appearing for the respondent department, I am of the view that there is considerable merit in the contentions taken by the learned counsel appearing for the respondent department that Ext.P2 does not suffer from any vice requiring it to be set aside in exercise of juri iction under Article 226 of the Constitution of India. Even if the opportunity of oral hearing has not been extended to the petitioner it appears that the contentions raised by the petitioner through written submissions have been considered by the 2nd respondent. That apart, the 2nd respondent has not relegated the consideration of the stay petition to the assessing officer as contended by the learned counsel for the petitioner. The 2nd respondent has only directed the assessing officer to calculate the amounts payable in terms of Ext.P2 order.

Faced with this situation, the learned counsel appearing for the petitioner states that the amount now directed to be paid as a condition for stay is extremely onerous. It is submitted that the 2nd respondent has not properly considered the merits of the petitioner's claim in the appeal and if that had been properly considered he would have granted an absolute stay without imposing any conditions. It is submitted that the tax demand is only Rs.5 crores and if the petitioner is required to pay 20% of approximately Rs.12 crores as a condition for stay, the petitioner would be put to serious injury, prejudice and hardship. Having regard to the aforesaid submissions, I am of the view that in order to shorten the litigation and to avoid further controversy, the demands against the petitioner can be stayed by imposing conditions. Accordingly, this writ petition will stand disposed of directing that if the petitioner pays a sum of Rs.1.25 crores in three equal instalments commencing from 15.12.2022, the demands arising out of the assessment order for the assessment year 2016-2017 shall remain stayed pending disposal of the appeal filed against the said assessment order. GOPINATH P. JUDGE RMV