M.M. SHAJAHAN vs. THE INCOME TAX OFFICER

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WP(C)/15479/2020HC KeralaKLHC01039117202029 July 2020Author: HONOURABLE DR. JUSTICE A.K.JAYASANKARAN NAMBIAR4 pages
AI SummaryRemanded

What did the High Court hold?

The High Court directed the Commissioner of Income Tax (Appeals) (3rd respondent) to consider and pass reasoned orders on the petitioner's delay condonation application (Ext.P4(a)) and thereafter on the stay petition (Ext.P5) within four months of receiving a copy of the judgment, after hearing the petitioner. The Court also directed that recovery steps for the amounts confirmed by the penalty order (Ext.P3) be kept in abeyance until orders are passed by the 3rd respondent and communicated to the petitioner. The petitioner was instructed to furnish copies of the writ petition and the judgment to the 3rd respondent. The Court did not decide on the merits of the penalty order or the validity of the recovery, but focused on procedural directions to ensure the appellate process is considered before recovery is enforced.

What were the facts?

The petitioner, M.M. Shajahan, filed a writ petition before the High Court of Kerala challenging recovery steps initiated by the Income Tax Officer (Ward-1(3)) and others. The recovery was for amounts confirmed by a penalty order (Ext.P3). The petitioner had appealed against this penalty order before the Commissioner of Income Tax (Appeals) (3rd respondent), filing Ext.P4 appeal along with a delay condonation application (Ext.P4(a)) and a stay petition (Ext.P5). The petitioner contended that recovery steps were being taken even before the stay petition was considered. The delay in filing the appeal before the 3rd respondent was 1356 days.

What were the issues?

1. Whether the Commissioner of Income Tax (Appeals) should consider the delay condonation application and the stay petition filed by the petitioner, and pass reasoned orders thereon, despite the significant delay of 1356 days in filing the appeal? (Question of mixed law and fact, concerning procedural fairness and the powers of the appellate authority under the Income Tax Act). Assessee's Contention: The petitioner argued that recovery steps were being pursued prematurely, even before the appellate authority had an opportunity to consider the stay petition. The petitioner sought directions for the appellate authority to consider the pending applications. Revenue's Contention: The judgment does not record any specific arguments from the revenue's side. However, their actions of initiating recovery steps suggest a position that recovery can proceed pending appeal, or that the delay in appeal is a bar to relief.

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 29TH DAY OF JULY 2020 / 7TH SRAVANA, 1942 WP(C).No.15479 OF 2020 PETITIONER/S: M.M. SHAJAHAN FLAT NO.12B, HEERA INFOCITY KUZHIVILA POST THIRUVANANTHAPURAM BY ADVS. SRI.V.P.NARAYANAN SMT.NISHA JOHN RESPONDENT/S: 1 THE INCOME TAX OFFICER WARD-1(3), 5TH FLOOR AAYAKAR BHAVAN, KOWDIAR THIRUVANANTHAPURAM-695 003 2 THE PRINCIPAL COMMISSIONER OF INCOME TAX AAYAKAR BHAWAN, KOWDIAR THIRUVANANTHAPURAM- 695 003 3 THE COMMISSIONER OF INCOME TAX (APPEALS) AAYAKAR BHWAN, KOWDIAR THIRUVANANTHAPURAM 695 003 OTHER PRESENT: SC: CHRISTOPHER ABRAHAM THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 29.07.2020, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C).No.15479 OF 2020 2

JUDGMENT Against Ext.P3 penalty order under the Income Tax Act, the petitioner has preferred Ext.P4 appeal together with Ext.P4(a) delay condonation application and Ext.P5 stay petition before the 3rd respondent. 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.P3 penalty 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.

Taking note of the fact that the delay in approaching the 3rd respondent is 1356 days I deem it appropriate to direct the 3rd respondent to consider and pass reasoned orders on Ext.P4(a) delay condonation application and thereafter on Ext.P5 stay petition within a period of four month from the date of receipt of a copy of this judgment, after hearing the petitioner.

WP(C).No.15479 OF 2020 3

2.

Recovery steps for recovery of amounts confirmed against the petitioner by Ext.P3 penalty 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 SJ

WP(C).No.15479 OF 2020 4

Appendix — schedule of exhibits
APPENDIX PETITIONER'S/S EXHIBITS: EXHIBIT P1 TRUE COPY OF THE ASSESSMENT ORDER DATED 11.03.2015 PASSED BY THE 1ST RESPONDENT ALONG WITH DEMAND NOTICE EXHIBIT P2 TRUE COPY OF THE ACKNOWLEDGMENT RECEIPT DATED 5.03.2011 OBTAINED FROM THE 1ST RESPONDENT'S OFFICE EXHIBIT P3 TRUE COPY OF THE ORDER DATED 23.09.2015 ISSUED BY THE 1ST RESPONDENT UNDER SECTION 271(1)(C) EXHIBIT P4 TRUE COPY OF THE MEMORANDUM OF APPEAL DATED 17.7.2019 FILED BY THE PETITIONER BEFORE THE 3RD RESPONDENT EXHIBIT P4(a) TRUE COPY OF THE PETITION FOR CONDONATION OF DELAY 8.7.2019 IN FILING THE APPEAL BEFORE THE 3RD RESPONDENT ALONG WITH SUPPORTING AFFIDAVIT EXHIBIT P5 TRUE COPY OF THE STAY PETITION DATED 10.7.2020 FILED BY THE PETITIONER BEFORE THE 3RD RESPONDENT.

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