M/s. Somatheeram Research Institute and Ayurveda Hospital Pvt. Ltd vs. 1. Additional/Joint/Deputy/Assistant Commissioner of Income Tax/Income-tax Officer,

WP(C)/376/2023HC KeralaKLHC01000943202306 January 2023Bench: HONOURABLE MR. JUSTICE GOPINATH P.6 pages

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What did the High Court hold?

The High Court of Kerala, considering the limited nature of the relief sought, disposed of the writ petitions with a specific direction. The Court ordered that the stay petitions filed by the petitioner against the order of assessment and the order imposing penalty for the assessment year 2018-19 must be considered and disposed of by the appellate authority without any delay. Crucially, the Court directed that until such time as orders are passed on these stay petitions, any steps for the recovery of amounts due under the assessment order and the penalty order for the assessment year 2018-19 shall be kept in abeyance. The principle established is that recovery can be deferred pending the appellate authority's decision on stay applications, provided the applications are considered expeditiously.

What were the facts?

The petitioner, M/s. Somatheeram Research Institute and Ayurveda Hospital Pvt. Ltd., is challenging an order of assessment and an order imposing penalty for the assessment year 2018-19. The petitioner has filed appeals against these orders along with applications for stay before the appellate authority. The petitioner apprehends that recovery proceedings might be initiated for the amounts due under the assessment and penalty orders while the stay petitions are pending. These writ petitions were filed seeking a direction to keep recovery steps in abeyance until the appellate authority decides the stay petitions.

What were the issues?

1. Whether recovery proceedings for amounts due under an order of assessment and an order imposing penalty can be initiated pending the decision on stay petitions filed by the assessee before the appellate authority? (Question of law) Assessee's Contention: The petitioner argued that recovery steps should be kept in abeyance until their stay petitions are decided by the appellate authority. They apprehended that recovery might be initiated before the appellate authority could consider and dispose of their applications for stay. Revenue's Contention: The revenue, represented by the Standing Counsel, was heard. No specific arguments or reliance on any authorities were recorded in the judgment for the revenue's side regarding the stay of recovery.

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Heard together (2 matters)

WP(C) NO. 376 OF 2023

WP(C) NO. 364 OF 2023

Read from the judgment's own cause title. This page is filed under one of them.

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE GOPINATH P. FRIDAY, THE 6TH DAY OF JANUARY 2023 / 16TH POUSHA, 1944 WP(C) NO. 376 OF 2023 PETITIONER: M/S. SOMATHEERAM RESEARCH INSTITUTE AND AYURVEDA HOSPITAL PVT. LTD., P K VI/1332, CHOWARA P.O., THIRUVANANTHAPURAM, REPRESENTED BY BABY MATHEW, MG. DIRECTOR BY ADVS. P.S.SOMAN T.RADHAMONY B.PRABHAKARAN NANCY PRABHAKAR RESPONDENTS: 1 ADDITIONAL/JOINT/DEPUTY/ASSISTANT COMMISSIONER OF INCOME TAX/INCOME-TAX OFFICER, NATIONAL FACELESS ASSESSMENT CENTRE, NORTH BLOCK, NEW DELHI – 110 001. 2 COMMISSIONER OF INCOME TAX (APPEALS), NATIONAL FACELESS ASSESSMENT CENTRE (NFAC), C BLOCK, 4TH FLOOR, S P M CIVIC CENTRE, NEW DELHI – 110 001. BY SRI.CHRISTOPHER ABRAHAM, SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 06.01.2023 ALONG WITH WP(C) NO. 364 OF 2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

WP(C) NOS. 376 & 364 OF 2023 2 IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE GOPINATH P. FRIDAY, THE 6TH DAY OF JANUARY 2023 / 16TH POUSHA, 1944 WP(C) NO. 364 OF 2023 PETITIONER: SOMATHEERAM RESEARCH INSTITUTE AND AYURVEDA HOSPITAL PVT. LTD., P K VI/1332, CHOWARA P.O., THIRUVANANTHAPURAM REPRESENTED BY BABY MATHEW, MG. DIRECTOR. BY ADVS. P.S.SOMAN T.RADHAMONY B.PRABHAKARAN NANCY PRABHAKAR RESPONDENTS: 1 ADDITIONAL/JOINT/DEPUTY/ASSISTANT COMMISSIONER OF INCOME TAX/INCOME-TAX OFFICER, NATIONAL E- ASSESSMENT CENTRE, NORTH BLOCK, NEW DELHI – 110 001. 2 COMMISSIONER OF INCOME TAX (APPEALS), NATIONAL FACELESS APPEAL CENTRE (NFAC), C BLOCK, 4TH FLOOR, S P M CIVIC CENTRE, NEW DELHI – 110 001. ADV. CHRISTOPHER ABRAHAM (SC) THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 06.01.2023 WP(C) NO. 376 OF 2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

WP(C) NOS. 376 & 364 OF 2023 3 JUDGMENT The petitioner in these cases is common. The petitioner suffered an order of assessment and an order imposing penalty for the assessment year 2018-19 under the provisions of the Income Tax Act, 1961. The petitioner has filed appeals against an order of assessment and the order imposing penalty along with applications for stay. The petitioner apprehends that proceedings may be taken to recover amounts due under the order of assessment and the order imposing penalty, pending consideration of the stay petitions by the appellate authority. The learned counsel for the petitioner prays that the recovery steps may be kept in abeyance till the stay petitions are decided by the appellate authority. 2. Heard the learned Standing Counsel also. 3. Having regard to the limited nature of relief sought for in these writ petitions, these writ petitions will stand disposed of directing that the stay petitions filed by the petitioner in the appeal filed against the order of assessment and the order imposing penalty shall be considered and

WP(C) NOS. 376 & 364 OF 2023 4 disposed of by the appellate authority without delay. Till such time as orders are passed on those stay petitions, any steps for recovery of amounts due under the order of assessment and the order of penalty for the assessment year 2018-19 shall be kept in abeyance. Sd/- GOPINATH P. JUDGE DK

WP(C) NOS. 376 & 364 OF 2023 5 APPENDIX OF WP(C) 376/2023 PETITIONER EXHIBITS Exhibit P1 TRUE COPY OF THE ASSESSMENT ORDER NO. ITBA/AST/S/143(3)/2020- 21/1031555982(1) DATED 17-03-2021 ISSUED BY THE 1ST RESPONDENT FOR THE ASSESSMENT YEAR 2018-19 Exhibit P2 TRUE COPY OF THE DEMAND NOTICE NO. ITBA/AST/S/156/2020-21/1031556146(1) DATED 17-03-2021 ISSUED BY THE 1ST RESPONDENT FOR THE ASSESSMENT YEAR 2018-19 Exhibit P3 TRUE COPY OF THE PENALTY ORDER NO. ITBA/PNL/F/270A/2021-22/1037824020(1) DATED 15-12-2021 ISSUED BY THE 1ST RESPONDENT FOR THE ASSESSMENT YEAR 2018-19. Exhibit P4 TRUE COPY OF THE DEMAND NOTICE NO. ITBA/PNL/S/156/2021-22/1037824106(1) DATED 15-12-2021 ISSUED BY THE 1ST RESPONDENT FOR THE YEAR 2018-19 Exhibit P5 TRUE COPY OF THE APPEAL MEMORANDUM ALONG WITH STAY PETITION FILED BEFORE THE 2ND RESPONDENT FOR THE YEAR 2018- 19 DATED 25-05-2022

WP(C) NOS. 376 & 364 OF 2023 6 APPENDIX OF WP(C) 364/2023 PETITIONER EXHIBITS Exhibit P1 TRUE COPY OF THE ASSESSMENT ORDER NO. ITBA/AST/S/143(3)/2020- 21/1031555982(1) DATED 17-03-2021 ISSUED BY THE 1ST RESPONDENT FOR THE ASSESSMENT YEAR 2018-19 Exhibit P2 TRUE COPY OF THE DEMAND NOTICE NO. ITBA/AST/S/156/2020-21/1031556146(1) DATED 17-03-2021 ISSUED BY THE 1ST RESPONDENT FOR THE ASSESSMENT YEAR 2018-19 Exhibit P3 TRUE COPY OF THE APPEAL MEMORANDUM ALONG WITH STAY PETITION FILED BEFORE THE 2ND RESPONDENT FOR THE YEAR 2018- 19 DATED 24-05-2022

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