V.GOPALAN vs. CHIEF COMMISSIONER OF INCOME TAX

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WP(C)/16955/2013HC KeralaKLHC01060149201323 November 2020Author: HONOURABLE MR. JUSTICE T.R.RAVI5 pages
AI SummaryRemanded

What did the High Court hold?

The High Court disposed of the writ petition by permitting the petitioner to file an appeal against the intimation dated December 20, 2001, under Section 143(1) and the intimation dated December 31, 2003, under Section 154, within three weeks from the date of the order. The Court directed that if such an appeal were filed, it should be treated as filed within the time limit and disposed of on merits by the concerned authority. The Court did not decide the merits of the claim for relief under Section 89(1) but provided a procedural remedy.

What were the facts?

The petitioner, V. Gopalan, challenged orders from the Income Tax Department concerning tax levied on amounts received under a Voluntary Retirement Scheme. The petitioner initially filed a return but received an intimation under Section 143(1) on December 20, 2001, denying relief under Section 89(1). A subsequent intimation under Section 154 on December 31, 2003, declined to revise the assessment. The petitioner then approached the Commissioner of Income Tax under Section 264, but relief was declined by Ext.P1. By Ext.P4, the Commissioner found that while the legal position favored the petitioner, the relief could not be granted as a rectification application was filed after the jurisdictional High Court's decision. Subsequently, by Ext.P6, the Income Tax Department raised a demand for arrears of tax.

What were the issues?

1. Whether the amounts received by the petitioner under the Voluntary Retirement Scheme can be brought to tax under the Income Tax Act, specifically concerning the entitlement to relief under Section 89(1)? The petitioner contended that he was entitled to relief under Section 89(1) of the Income Tax Act. The respondents reiterated that the order rejecting the rectification application (Ext.P4) was in accordance with law, as it was filed after the jurisdictional High Court's decision in favor of the assessee. However, the respondents conceded that the intimations under Sections 143(1) and 154 were appealable under Section 246(A) of the Income Tax Act, and an appeal would have been the appropriate remedy for the petitioner.

Which sections of the Income-tax Act were involved?

Section 89(1),Section 143(1),Section 154,Section 264,Section 246(A)

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 T.R.RAVI MONDAY, THE 23RD DAY OF NOVEMBER 2020 / 2ND AGRAHAYANA, 1942 WP(C).No.16955 OF 2013(T) PETITIONER: V.GOPALAN AGED 66 YEARS S/O.V.PAIDAL NAIR, SUBU NIVAS, PANNIYANNUR PO, THALASSERY 670 679 BY ADVS. SRI.N.T.NANDAKUMAR (PARAVUR) SRI.ASHISH MOHAN RESPONDENTS: 1 CHIEF COMMISSIONER OF INCOME TAX KERALA, ERNAKULAM, PIN 680 018 2 COMMISSIONER OF INCOME TAX MELE CHOVVA, KANNUR, PIN 670 006 3 INCOME TAX OFFICER WARD 3, MELE CHOVVA, KANNUR, PIN 670 006. BY SRI.P.K.R.MENON,SENIOR COUNSEL, GOI(TAXES) BY SRI.JOSE JOSEPH, SC, FOR INCOME TAX THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 23.11.2020, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C).No.16955 OF 2013(T) 2

JUDGMENT The writ petition has been filed praying to quash Exts.P1, P4 and P6 and to issue a writ of mandamus directing the respondents not to levy tax from the petitioner since he is entitled to the relief under Section 89(1) of the Income Tax Act. The issue relates to whether the amounts received by the petitioner under the Voluntary Retirement Scheme can be brought to tax under the Income Tax Act. The petitioner had filed return initially but he was issued with an intimation under Section 143(1) on 20.12.2001 denying the relief under Section 89(1). There was another intimation under Section 154 on 31.12.2003 declining to revise the assessment. In the above circumstances, the petitioner approached the Commissioner of Income Tax under Section 264 of the Income Tax Act. By Ext.P1, the said relief was declined. Thereafter, on 14.01.2010, by Ext.P4, the Commissioner of Income Tax found that even though

WP(C).No.16955 OF 2013(T) 3 the legal position is settled in favour of the petitioner, he will not be able to give the relief since a rectification application filed subsequent to the decision of the juri ictional High Court cannot be maintained. By Ext.P6, the Income Tax Department raised a demand on the petitioner regarding the arrears of tax to be paid.

2.

When the case is taken up today, learned counsel for the respondents reiterated the contention that Ext.P4 order cannot be found fault since the Officer has acted only in accordance with law when he rejected the rectification application, for the reason that it was filed after the decision of the juri ictional High Court in favour of the assessee. At the same time, it is conceded that the intimations under Sections 143 and 154 were appealable under Section 246(A) of the Income Tax Act and appropriate remedy for the petitioner was to move an appeal. The writ petition is hence disposed of WP(C).No.16955 OF 2013(T) 4 permitting the petitioner to file an appeal against the intimation dated 20.12.2001 under Section 143(1) and intimation dated 31.12.2003 under Section 154 within a period of three weeks from today. If such an appeal is filed, the same shall be treated as an appeal filed within time and concerned authority shall dispose of the same on merits. T.R.RAVI JUDGE Pn 23/11

WP(C).No.16955 OF 2013(T) 5

Appendix — schedule of exhibits
APPENDIX PETITIONER'S/S EXHIBITS: EXHIBIT P1 TRUE PHOTOCOPY OF THE REVISIONAL ORDER PASSED BY THE 2ND RESPONDENT EXHIBIT P2 TRUE PHOTOCOPY OF THE APPLICATION FOR RECTIFICATION FILED BY THE PETITIONER BEFORE THE 2ND RESPONDENT EXHIBIT P3 TRUE PHOTOCOPY OF THE ORDER IN WPC NO.26055/2009 EXHIBIT P4 TRUE PHOTOCOPY OF THE ORDER IN P2 PASSED BY 2ND RESPONDENT EXHIBIT P5 TRUE PHOTOCOPY OF THE REPRESENTATION SUBMITTED BY THE PETITIONER TO THE 2ND RESPONDENT EXHIBIT P6 TRUE PHOTOCOPY OF THE NOTICE OF DEMAND ISSUED BY THE 3RD RESPONDENT

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