KOMATHU KURIAKOSE THANKACHAN vs. THE CENTRAL BOARD OF DIRECT TAXES

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WP(C)/23099/2020HC KeralaKLHC01057801202028 October 2020Author: HONOURABLE DR. JUSTICE A.K.JAYASANKARAN NAMBIAR4 pages
AI SummaryRemanded

What did the High Court hold?

The High Court disposed of the writ petition with specific directions. It held that the Commissioner of Income Tax (Appeals) must consider and pass reasoned orders on the petitioner's stay petition (Ext.P4) within four months of receiving a copy of the judgment, after hearing the petitioner. Furthermore, the Court directed that recovery steps pursuant to the demand notice (Ext.P3) for the amounts confirmed by the assessment order (Ext.P1) shall be kept in abeyance until such time as the Commissioner of Income Tax (Appeals) passes orders on the stay petition and communicates them to the petitioner. The petitioner was directed to furnish copies of the writ petition and the judgment to the Commissioner of Income Tax (Appeals). No specific finding was made on the merits of the assessment order itself.

What were the facts?

The petitioner, Komathu Kuriakose Thankachan, filed a writ petition before the High Court of Kerala challenging recovery steps initiated by the respondents. The petitioner had preferred an appeal (Ext.P2) along with a stay petition (Ext.P4) against an assessment order (Ext.P1) before the Commissioner of Income Tax (Appeals). A demand notice (Ext.P3) was also issued. The petitioner contended that recovery actions were being taken even before the stay petition was considered. The respondents included the Central Board of Direct Taxes, the Income Tax Officer, Ward 3, Aluva, and the Commissioner of Income Tax (Appeals), Kochi.

What were the issues?

1. Whether recovery steps can be initiated against the petitioner before the disposal of their stay petition filed before the Commissioner of Income Tax (Appeals)? (Question of law and fact, concerning the procedural fairness and the Income Tax Act). Assessee's Contention: The petitioner argued that recovery steps were being taken prematurely, prior to the consideration and decision on their stay petition, which would cause undue hardship. The petitioner relied on the general principles of natural justice and the right to seek effective redressal against an assessment order. Revenue's Contention: The judgment does not record specific arguments made by the revenue. However, the existence of the demand notice implies the revenue's position that recovery is permissible as per the assessment order.

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 A.K.JAYASANKARAN NAMBIAR WEDNESDAY, THE 28TH DAY OF OCTOBER 2020 / 6TH KARTHIKA, 1942 WP(C).No.23099 OF 2020(J) PETITIONER: KOMATHU KURIAKOSE THANKACHAN AGED 55 YEARS, HOUSE NO.12 KOMATHU HOUSE, MAHATMA NAGAR PHASE 1, O.M. ROAD, PERUMBAVOOR, PERUMBAVOOR - 673542 BY ADVS. DR.K.P.PRADEEP SHRI.HAREESH M.R. SRI.T.T.BIJU SMT.T.THASMI RESPONDENTS: THE CENTRAL BOARD OF DIRECT TAXES DEPARTMENT OF REVENUE, MINISTRY OF FINANCE, GOVERNMENT OF INDIA, NORTH BLOCK, NEW DELHI - 110001, REPRESENTED BY ITS CHAIRMAN INCOME TAX OFFICER, WARD 3, ALUVA, INCOME TAX DEPARTMENT, K.A.P. COMMERCIAL COMPLEX, OFFICE OF ADDITIONAL CIT, ALUVA RANGE, R.S ROAD, ALUVA - 683101 COMMISSIONER OF INCOME TAX (APPEALS) KOCHI, POORNIMA BUILDINGS, PANAMBPILLY NAGAR, KOCHI, PION 682036 BY ADV. SC: CHRISTOPHER ABRAHAM THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 28.10.2020, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING : W.P.(C). No. 23099 of 2020 2

JUDGMENT Against Ext.P1 assessment order under the Income Tax Act, the petitioner has preferred Ext.P2 appeal together with Ext.P4 stay petition before the 3rd respondent. Ext.P3 is the demand notice. It is the case of the petitioner that even prior to considering the stay petition, recovery steps are taken by the respondents against the petitioner for recovery of the amounts confirmed by Ext.P1 assessment order.

2.

I have heard the learned counsel appearing for the petitioner and also the learned Government Pleader appearing for the respondents. On a consideration of the facts and circumstances of the case as also the submissions made across the Bar, I dispose the writ petition with the following directions:

1.

The 3rd respondent shall consider and pass reasoned orders on Ext.P4 stay petition within a period of four months from the date of receipt of a copy of this judgment, after hearing the petitioner.

2.

Recovery steps pursuant to Ext P3 demand notice for recovery of amounts confirmed against the petitioner by Ext.P1 assessment order shall be kept in abeyance till such time as orders are passed by the 3rd respondent as directed above and communicated to the petitioner.

3.

The petitioner shall produce a copy of the writ petition together with a copy of this judgment, before the 3rd respondent, for further action. A.K. JAYASANKARAN NAMBIAR JUDGE VPK

Appendix — schedule of exhibits
APPENDIX PETITIONER'S/S EXHIBITS: EXHIBIT P1 TRUE COPY OF THE ASSESSMENT ORDER NO.ITBA/AST/S/143(3)/2019- 20/1023512871(1) DATED 31.12.2019 ISSUED FOR THE YEAR 2017-18 BY THE 2ND RESPONDENT. EXHIBIT P2 TRUE COPY OF THE APPEAL DATED 14.10.2020 FILED BEFORE THE 3RD RESPONDENT FOR THE ASSESSMENT YEAR 2017-18. EXHIBIT P3 TRUE COPY OF THE DEMAND NOTICE NO.ITBA/AST/S/156/2019-20/1023513230(1) DATED 31.12.2019 FOR THE YEAR 2017-18 ISSUED BY THE 2ND RESPONDENT. EXHIBIT P4 TRUE COPY OF THE STAY APPLICATION FILED ON 14.10.2020 BEFORE THE 3RD RESPONDENT TO EXT.P2 APPEAL.

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