M/S. PONMUNDAM PROPERTIES PVT. LTD., vs. ASSISTANT COMMISSIONER OF INCOME TAX

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WP(C)/41737/2018HC KeralaKLHC01096893201820 December 2018Author: HONOURABLE MR. JUSTICE DAMA SESHADRI NAIDU3 pages
AI SummaryRemanded

What did the High Court hold?

The High Court did not decide the merits of the case. Instead, it recorded the submission made by the learned Standing Counsel for the revenue, who stated that the Commissioner of Income Tax would consider the petitioner's application (Ext.P6) expeditiously. Based on this submission, the Court disposed of the writ petition. No finding was reached on the legality of the 20% pre-condition or the application of Section 220(6). The operative direction was to dispose of the application expeditiously.

What were the facts?

The petitioner, M/s. Ponmundam Properties Pvt. Ltd., filed a statutory appeal and a stay petition for assessment year 2015-16. While the appeal was pending, the petitioner filed an application under Section 220(6) of the Income Tax Act. The Assistant Commissioner of Income Tax, through an order (Ext.P5), disposed of this application by requiring the petitioner to pay 20% of the demand as a pre-condition for a stay. The petitioner then challenged this order before the Commissioner of Income Tax (Ext.P6) and filed the present writ petition seeking early disposal of that application.

What were the issues?

1. Whether the Assistant Commissioner of Income Tax was justified in demanding 20% of the tax as a pre-condition for granting a stay on proceedings, under Section 220(6) of the Income Tax Act, 1961. The assessee contended that the impugned order requiring a 20% payment was arbitrary and that the application under Section 220(6) should have been considered on its merits. The revenue did not present any arguments as recorded in the judgment.

Which sections of the Income-tax Act were involved?

Section 220(6)

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 DAMA SESHADRI NAIDU THURSDAY ,THE 20TH DAY OF DECEMBER 2018 / 29TH AGRAHAYANA, 1940 WP(C).No. 41737 of 2018 PETITIONER/S: M/S. PONMUNDAM PROPERTIES PVT. LTD., 11/13, PUTHUKUDI, PONMUNDAM P.O., MALAPPURAM - 676106, REPRESENTED BY MANAGING DIRECTOR P.K. HAMZA. BY ADVS. SRI.ANIL D. NAIR SHRI.GOKULRAJ L. SMT. ARYA ANIL SMT. NILOOFAR O. NIZAM SRI.R.SREEJITH RESPONDENT/S: 1 ASSISTANT COMMISSIONER OF INCOME TAX CENTRAL CIRCLE II, KOZHIKODE - 673001. 2 THE COMMISSIONER OF INCOME TAX (APPEALS III), ERNAKULAM - 682036. OTHER PRESENT: SRI JOSE JOSEPH, SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 20.12.2018, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: -2- W.P.(C). No. 41737 of 2018

JUDGMENT For the assessment years 2015-16, the petitioner filed a statutory appeal along with a stay petition. Pending that appeal, the petitioner filed an application under Section 220(6) of the Income Tax Act. The Assistant Commissioner of Income Tax has, however, disposed of the petitioner's Ext.P4 application through the Ext.P5 order. That authority required the petitioner to pay 20% as a pre- condition to have the proceedings stayed. Then, the petitioner challenged the Ext.P5 before the Commissioner of Income Tax, through Ext.P6 application. Seeking its early disposal, the petitioner has filed this writ petition.

2.

In response to the submissions made by the petitioner's counsel, the learned Standing Counsel informs the Court that the Commissioner of Income Tax will consider the Ext.P6 application expeditiously. Recording that submission, I dispose of the writ petition. DAMA SESHADRI NAIDU JUDGE das

-3- W.P.(C). No. 41737 of 2018 APPENDIX PETITIONER'S/S EXHIBITS: EXHIBIT P1OF THE ASSESSMENT ORDER DATED 30/12/2017. EXHIBIT P2OF THE APPEAL FILED BEFORE THE 2ND RESPONDENT. EXHIBIT P3OF STAY PETITION FILED BEFORE THE 2ND RESPONDENT. EXHIBIT P4OF THE APPLICATION UNDER SEC. 220(6) FILED BEFORE THE 1ST RESPONDENT. EXHIBIT P5OF THE ORDER BY THE 1ST RESPONDENT DATED 02/02/2018. EXHIBIT P6OF LETTER DATED 12/02/2018.

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