TRISHA CHARITABLE TRUST, vs. THE INCOME TAX OFFICER,

WP(C)/6074/2020HC KeralaKLHC01016108202028 February 2020Author: HONOURABLE MR.JUSTICE S.V.BHATTI4 pages

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What did the High Court hold?

The High Court held that a case was made out for issuing necessary directions to the second respondent (appellate authority) to dispose of the stay petition (Ext.P3) expeditiously. The Court was satisfied that, given the limited prayer and the grounds raised, the writ petition could be disposed of by issuing directions. The operative directions were: (a) the appellate authority/second respondent to consider and dispose of Ext.P3 as early as possible, preferably within three months from the date of receipt of a copy of the judgment; and (b) the respondents were directed not to take coercive steps or recover the amount determined in the order under appeal for three months from the date of the judgment. The ratio is that the High Court can direct expeditious disposal of stay petitions to prevent the appeal from becoming infructuous and can grant a temporary reprieve from coercive recovery.

What were the facts?

The petitioner, M/s. Trisha Charitable Trust, filed an appeal (Ext.P2) against an assessment order (Ext.P1) passed under the Income Tax Act. Along with the appeal, the petitioner filed a stay petition (Ext.P3). The petitioner approached the High Court of Kerala seeking a direction to the appellate authority (second respondent) to consider and dispose of the stay petition expeditiously. The petitioner argued that mere pendency of an appeal does not grant a stay, and delay in deciding the stay petition could lead to recovery proceedings by the assessing officer, rendering the statutory appeals ineffective. The High Court perused the documents and found a case for issuing directions.

What were the issues?

1. Whether the High Court should issue a direction to the appellate authority to expeditiously consider and dispose of the stay petition filed by the assessee pending appeal? (Question of procedure and administrative efficiency). Assessee's Contentions: - The mere filing of an appeal or pendency of an appeal does not automatically grant a stay. - Delay in disposing of the stay petition could result in the assessing officer initiating recovery proceedings for the disputed tax amount. - Such recovery actions before the disposal of the stay petition would render the statutory appeals either academic or ineffective. - The law provides for the expeditious disposal of stay petitions to protect the interest of the appellant during the pendency of appeals. Revenue's Contentions: - No specific contentions are recorded for the revenue in the judgment.

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 S.V.BHATTI FRIDAY, THE 28TH DAY OF FEBRUARY 2020 / 9TH PHALGUNA, 1941 WP(C).No.6074 OF 2020(H) PETITIONER/S: M/S.TRISHA CHARITABLE TRUST, MANISSERY, OTTAPPALAM, PALAKKAD-679 521, REPRESENTED BY ITS CHAIRMAN KODAKKATUTHODY RAMASWAMY. BY ADVS. SRI.T.M.SREEDHARAN (SR.) SMT.NISHA JOHN SRI.V.P.NARAYANAN RESPONDENT/S: 1 THE INCOME TAX OFFICER, EXEMPTION WARD, AAYAKAR BHAVAN, SHAKTHAN THAMPURAN NAGAR, THRISSUR-682 001. 2 THE COMMISSIONER OF INCOME TAX (APPEALS), AAYAKAR BHAVAN, SHAKTHAN THAMPURAM NAGAR, THRISSUR-682 001. OTHER PRESENT: SC - SRI. JOSE JOSEPH THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 28.02.2020, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W.P.(C) No. 6074/2020 -2- J U D G M E N T Dated this the 28th day of February 2020 The petitioner filed appeal in Ext.P2 aggrieved by the order of assessment in Ext.P1 made under the Income Tax Act. The petitioner has filed the appeal with Ext.P3 stay petition. The petitioner prays for appropriate direction to the appellate authority to consider and dispose of Ext.P3 expeditiously. 2. The case of petitioner is that either the mere filing of appeal or pendency of appeal does not amount to granting stay by the appellate authority. The delay in considering and disposing of Ext.P3 results in the assessing officer taking steps for recovering the tax amount which is under challenge in Ext.P2. The assessing officer, if is successful in his effort the statutory appeals would become either academic or ineffective. It is further contended by the petitioner that in the manner the law provides for protecting W.P.(C) No. 6074/2020 -3- the interest of appellant pending appeals, the order on stay petition is passed expeditiously. Hence the writ petition. 3. Perused Exts.P1, P2, P3 and P4 series. Prima facie I am satisfied that a case is made out for issuing necessary directions to second respondent to dispose of the stay petition in Ext.P3. Having regard to the limited prayer and the grounds referred to above, this Court is satisfied that the writ petition can be

disposed of by this order: (a) The appellate authority/second respondent considers and disposes of Ext.P3 as early as possible, preferably within three months from the date of receipt of copy of this judgment. (b) The respondents are directed not to take coercive steps or recover the amount determined in the order under appeal for three months from today. S.V.BHATTI JUDGE jjj

W.P.(C) No. 6074/2020 -4- APPENDIX PETITIONER'S/S EXHIBITS: EXHIBIT P1OF THE ASSESSMENT ORDER DATED 20.12.2018 PASSED BY THE 1ST RESPONDENT FOR AY 2017-18 ALONG WITH DEMAND NOTICE AND COMPUTATION OF INCOME. EXHIBIT P2OF THE MEMORANDUM OF APPEAL DATED 20.01.2020 FOR AY 2017-18 FILED BY THE PETITIONER BEFORE THE 2ND RESPONDENT. EXHIBIT P3OF THE STAY PETITION DATED 20.01.2020 FILED BY THE PETITIONER BEFORE THE 2ND RESPONDENT FOR AY 2017-18. EXHIBIT P4OF THE APPLICATION DATED 22.02.2020 SUBMITTED BY THE PETITIONER UNDER SECTION 220(6) BEFORE THE 1ST RESPONDENT AY 2017-18. EXHIBIT P5OF THE NOTICE DATED 10.02.2020 ISSUED UNDER SECTION 221(1) BY THE 1ST RESPONDENT.

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