RAILWAYMENS HOUSE BUILDING CO-OPERATIVE SOCIETY LTD NO.E-738 vs. THE INCOME TAX OFFICER

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WP(C)/4467/2021HC KeralaKLHC01012183202122 February 2021Author: HONOURABLE MR. JUSTICE A.M.BADAR5 pages
AI SummaryPartly Allowed

What did the High Court hold?

The High Court directed the 3rd respondent (Commissioner of Income Tax (Appeals)) to decide the application for condonation of delay (Ext.P13) and, consequently, the stay petition (Ext.P12) within six weeks of the judgment's communication. The petitioner was directed to cooperate in this time-bound disposal. Until these applications were decided, the 1st respondent (Income Tax Officer) was directed to keep recovery proceedings in abeyance. The court reasoned that given the minimal delay of two days, a time-bound disposal of the stay petition by the appellate authority was appropriate, and recovery could be deferred in the interim. The principle is that interim relief can be granted pending disposal of a stay application, especially when the delay is minor, to ensure that the appeal, if admitted, is not rendered infructuous.

What were the facts?

The petitioner, Railwaymens House Building Co-operative Society Ltd., is challenging an Assessment Order (Ext.P10) issued by the Income Tax Officer (1st respondent). The petitioner filed an appeal (Ext.P11) before the Commissioner of Income Tax (Appeals) (3rd respondent), which was accompanied by a stay petition (Ext.P12) and an application for condonation of delay of two days (Ext.P13). The petitioner approached the High Court seeking a direction to the 1st respondent to defer recovery proceedings pursuant to the Assessment Order until the stay petition is disposed of. The respondents opposed the petition, arguing that the appeal was barred by limitation.

What were the issues?

1. Whether the Income Tax Officer (1st respondent) should be directed to defer recovery proceedings pending the disposal of the stay petition before the Commissioner of Income Tax (Appeals) (3rd respondent)? Assessee's contention: The petitioner argued that recovery was being effected pursuant to the Assessment Order and sought a direction to defer recovery until the stay petition was decided. The petitioner highlighted that the delay in filing the appeal was only two days. Revenue's contention: The revenue contended that the appeal itself was barred by limitation, and therefore, recovery could not be stayed.

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE A.M.BADAR MONDAY, THE 22ND DAY OF FEBRUARY 2021 / 3RD PHALGUNA, 1942 WP(C).No.4467 OF 2021(G) PETITIONER: RAILWAYMENS HOUSE BUILDING CO-OPERATIVE SOCIETY LTD NO.E-738 REPRESENTED BY ITS ASST. REGISTRAR/SECRETARY, RAILWAY BUILDING NO.77/A, ERNAKULAM JUNCTION, KOCHI, PIN - 682 016. BY ADVS. SRI.T.R.HARIKUMAR SRI.ARJUN RAGHAVAN RESPONDENTS: 1 THE INCOME TAX OFFICER NON CORPORATE WARD 1(4), C.R.BUILDING, I.S.PRESS ROAD, COCHIN - 682 018. 2 THE ASSISTANT DIRECTOR OF INCOME TAX CENTRALIZED PROCESSING CENTRE, BENGALURU - 560 600. 3 THE COMMISSIONER OF INCOME TAX (APPEALS) C.R.BUILDING, IS PRESS ROAD, COCHIN - 682 018. 4 THE COMMISSIONER OF INCOME TAX (APPEALS) NATIONAL FACELESS APPEAL CENTRE, NORTH BLOCK, DELHI - 110 001. 5 THE KERALA STATE CO-OPERATIVE BANK (FORMERLY KNOWN AS ERNAKULAM DISTRICT CO-OPERATIVE BANK), MAIN BRANCH, AEC PLAZA, CHITTOOR BRANCH, VALANJAMBALAM, ERNAKULAM DISTRICT, PIN - 682 016, REPRESENTED BY ITS BRANCH MANAGER. 6 THE KERALA STATE CO-OPERATIVE BANK (FORMERLY KNOWN AS ERNAKULAM DISTRICT CO-OPERATIVE BANK), EVENING BRANCH, AEC PLAZA, CHITTOOR BRANCH, VALANJAMBALAM, ERNAKULAM DISTRICT, PIN - 682 016, REPRESENTED BY ITS BRANCH MANAGER. SC,IT- SRI CHRISTOPHER ABRAHAM THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 22.02.2021, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

WP(C).No.4467 OF 2021(G) 2 JUDGMENT Dated this the 22nd day of February 2021 Heard the learned counsel for the petitioner.

2.

The Learned standing counsel, Sri. Christopher Abraham takes notice for respondent Nos. 1 to 4. Learned standing counsel takes notice for respondent Nos. 5 and 6. 3. The learned counsel for the petitioner submits that challenging the Assessment order at Ext.P10, he has preferred an appeal, Ext.P11, before the Commissioner of Income Tax (Appeals). That appeal is accompanied by stay petition at Ext.P12 as well as an application for condonation of delay of two days, Ext.P13. In submission of the learned counsel for the petitioner, the 1st respondent is effecting recovery in pursuance to the Assessment Order at Ext.P10 and therefore, the petitioner is approaching this Court with a request to direct the 1st respondent to defer the recovery till disposal of the stay petition.

4.

The learned standing counsel appearing for respondent Nos. 1 to 4 opposed the petition by contending that the appeal itself is barred by limitation and therefore, the recovery cannot be stayed.

5.

I have considered the submissions so advanced and also perused the materials placed before me. Undisputedly, the WP(C).No.4467 OF 2021(G) 3 Assessment Order issued by the 1st respondent is under challenge before the 3rd respondent Appellate Authority. The delay is stated to be only of two days and, therefore, the petition can be disposed of with a direction for time bound disposal of the stay petition by the Appellate Authority and till that time, the 1st respondent can be directed, not to effect recovery. Therefore, the order.

6.

The 3rd respondent is directed to decide the application for condonation of delay at Ext.P13 and consequently, if necessary, the stay petition at Ext.P12 within a period of six weeks from the date of communication of this judgment. The petitioner should co-operate with the 3rd respondent in deciding the application for condonation of delay and consequently the stay petition in a time bound manner. Till disposal of these applications, the 1st respondent is directed to keep the recovery proceedings in pursuance to the Assessment Order at Ext.P10 in abeyance. The petitioner to furnish copy of this judgment to the 3rd respondent who is expected to dispose of the applications after hearing the petitioner. A.M.BADAR N //// PA to Judge JUDGE

WP(C).No.4467 OF 2021(G) 4

Appendix — schedule of exhibits
APPENDIX PETITIONER'S/S EXHIBITS: EXHIBIT P1 A TRUE COPY OF THE REQUEST DATED 21/11/2019 SUBMITTED BEFORE THE 1ST RESPONDENT. EXHIBIT P2 A TRUE COPY OF FORM NO.3CA DATED 12/11/2019 SUBMITTED BY THE PETITIONER. EXHIBIT P3 A TRUE COPY OF FORM NO.3CD DATED 12/11/2019 SUBMITTED BY THE PETITIONER. EXHIBIT P4 A TRUE COPY OF THE REQUEST FOR CONDONATION OF DELAY CAUSED IN FILING THE RETURNS ALONG WITH ACKNOWLEDGMENT DATED 23/12/2019. EXHIBIT P5 A TRUE COPY OF THE NOTICE DATED 13/03/2020, ISSUED BY THE 1ST RESPONDENT TO THE PETITIONER. EXHIBIT P6 A TRUE COPY OF THE INCOME TAX RETURN ACKNOWLEDGMENT FOR THE ASSESSMENT YEAR 2019-2020 DATED 29/09/2020. EXHIBIT P7 A TRUE COPY OF THE COMMUNICATION DATED 08/10/2020 ISSUED BY THE 2ND RESPONDENT TO THE PETITIONER. EXHIBIT P8 A TRUE COPY OF THE ONLINE RESPONSE FILED BY THE PETITIONER TO EXT.P7 DATED NIL. EXHIBIT P9 A TRUE COPY OF THE DETAILED REPLY DATED 29/10/2020 FURNISHED BY THE PETITIONER TO EXT.P7. EXHIBIT P10 A TRUE COPY OF THE INTIMATION UNDER SECTION 143(1) OF THE INCOME TAX ACT DATED 04/01/2021. EXHIBIT P11 A TRUE COPY OF THE ONLINE APPEAL ALONG WITH STATEMENT OF FACTS DATED 08/02/2021. EXHIBIT P12 A TRUE COPY OF THE STAY PETITION DATED 08/02/2021 PREFERRED IN EXT.P11 APPEAL. EXHIBIT P13 A TRUE COPY OF THE DELAY CONDONATION PETITION DATED 08/02/2021 SEEKING TO CONDONE THE DELAY OF TWO DAYS. WP(C).No.4467 OF 2021(G) 5 EXHIBIT P14 A TRUE COPY OF THE JUDGMENT DATED 19/07/2019 IN W.A.NO.1639 OF 2019. EXHIBIT P15 A TRUE COPY OF THE JUDGMENT DATED 25/11/2019 IN WP(C) NO.31787 OF 2019. EXHIBIT P16 A TRUE COPY OF THE JUDGMENT DATED 24/02/2020 IN WP(C) NO.5205 OF 2020.

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