CHEERAN JOSE SHUNSON vs. THE INCOME TAX OFFICER

WP(C)/11567/2020HC KeralaKLHC01029708202012 June 2020Author: HONOURABLE MR. JUSTICE AMIT RAWAL4 pages

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What did the High Court hold?

The High Court disposed of the writ petition by directing the second respondent, the Commissioner of Income Tax (Appeals), to decide the stay application (Ext. P3) filed in support of the appeal (Ext. P2) as expeditiously as possible, within a period of two months from the date of receipt of a certified copy of the judgment. This decision was to be made after affording an opportunity of hearing to the petitioner. Pending the disposal of the stay application, the operation of the demand notice (Ext. P4) pertaining to Assessment Year 2016-17 was ordered to be kept in abeyance. The Court clarified that this interim order was only until the disposal of the stay application and not beyond. The Court made no comment on the merits of the case.

What were the facts?

The petitioner, Cheer an Jose Shunson, proprietor of M/s. Four Star Associate, is an assessee under the Income Tax Act, 1961. The 1st respondent, the Income Tax Officer, passed an assessment order dated 24.12.2019 for Assessment Year 2016-17, raising a demand of Rs. 65,52,503/-. The petitioner filed an appeal and a stay petition (Ext. P2 and Ext. P3) against this order. Similar orders were passed for Assessment Years 2015-16 and 2017-18, with appeals also filed. The petitioner received a demand notice (Ext. P4) for all three assessment years before the adjudication of the stay applications or disposal of the appeals. The petitioner filed a writ petition seeking directions to operate his bank account and to stay the assessment orders and demand notices, and for expeditious disposal of his appeals and stay petitions.

What were the issues?

1. Whether the petitioner is entitled to a direction for the expeditious disposal of his appeal and stay application before the Commissioner of Income Tax (Appeals)? (Question of procedure and administrative efficiency, turning on the general principles of natural justice and timely adjudication). Assessee's Contention: The petitioner argued that demand notices were being issued without the adjudication of his stay applications or the disposal of his appeals, causing him significant hardship. He sought directions for the expeditious disposal of these pending matters. Revenue's Contention: The Standing Counsel for the revenue submitted that the appeal and stay application had been taken up by seniority. However, the authority would not object to an appropriate direction being issued to the Commissioner of Income Tax (Appeals) to decide the stay application within a reasonable time.

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE AMIT RAWAL FRIDAY, THE 12TH DAY OF JUNE 2020 / 22ND JYAISHTA, 1942 WP(C).No.11567 OF 2020(U) PETITIONER: CHEERAN JOSE SHUNSON PROPRIETOR, M/S. FOUR STAR ASSOCIATE, PERUMATTY GRAMA PANCHAYATH, PETTAMUKKU, KANNIMRI, PALAKKAD 676 305. BY ADV. SRI.HARISANKAR V. MENON RESPONDENTS: 1 THE INCOME TAX OFFICER WARD 2 (5), AAYKAR BHAVAN, SHAKTHANTHAMPURAN NAGAR, THRISSUR 686 001. 2 THE COMMISSIONER OF INCOME TAX (APPEALS), THRISSUR 686 021. 3 THE STATE BANK OF INDIA, ARTHAT BRANCH, THRISSUR 680 521, REPRESENTED BY ITS MANAGER. BY SRI.JOSE JOSEPH, SC SRI.R.S.KALKURA, SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 12.06.2020, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

WP(C).No.11567 OF 2020(U) 2 JUDGMENT Dated this the 12th day of June 2020 The petitioner in the instant case has sought the indulgence of this Court for issuance of appropriate directions to respondents to permit the petitioner to operate the account held with respondent No.3 and as well as the stay of Ext. P1 assessment order and Ext.P4 notice, with a further prayer to dispose of Ext.P2 appeal and Ext.P3 stay petition within a reasonable period. In support of the aforementioned prayer, it is submitted that the petitioner is an assessee under the Income Tax Act, 1961. The assessment for the year 2016-17 was completed by the 1st respondent vide Ext.P1 order dated 24.12.2019 and a demand of Rs. 65,52,503/- was ordered. Petitioner preferred an appeal and stay application vide Exts. P2 and P3. For the other assessment years, i.e., 2015-16 and 2017-18 also similar orders have been passed, raising the demand and appeals have already been filed. However in the meantime, the petitioner received Ext.P4 demand notice raising, demand for all the three assessment years. The predicament of the petitioner is writ large, without adjudication of the applications for stay or disposal of the appeal, demand is being raised.

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Issue notice before admission. Adv. Navaneeth N. Nath for Adv. Sri. Jose Joseph, learned Standing Counsel submits that the appeal and stay application has been taken by seniority but the authority would not be averse, in case, an appropriate direction is issued to the Commissioner of Income Tax (Appeals) to decide the application for stay within a reasonable time.

Having heard learned counsel for the parties and appraised the paper booksand without commenting any opinion on the merits of the matter, I dispose of the writ petition with a direction to the second respondent to decide Ext.P3 stay application filed in support of Ext.P2 appeal, as expeditiously as possible, within a period of two months from the date of receipt of a certified copy of this judgment, after affording an opportunity of hearing to the petitioner. Till such time, the operation of Ext.P4 demand notice pertaining to Assessment Year 2016-17 is ordered to be kept in abeyance. It is made clear that the interim order is only till the disposal of Ext.P3 stay application and not beyond that. AMIT RAWAL JUDGE DCS

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Appendix — schedule of exhibits

APPENDIX PETITIONER'S/S EXHIBITS: EXHIBIT P1 COPY OF ASSESSMENT ORDER ISSUED BY THE 1ST RESPONDENT FOR THE YEAR 2016-17 DATED 24.12.2018. EXHIBIT P2 COPY OF APPEAL FILED BY THE PETITIONER BEFORE THE 2ND RESPLENDENT 2016-17 DATED 06.06.2019. EXHIBIT P3 COPY OF STAY PETITIONER FIELD BY THE PETITIONER BEFORE THE 2ND RESPONDENT 2016- 17 DATED 06.06.2019. EXHIBIT P4 COPY OF NOTICE ISSUED BY THE 3RD RESPONDENT DATED 16.03.2020.

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