THE COCHIN MALABAR ESTATES AND INDUSTRIES LIMITED, vs. THE COMMISSIONER OF INCOME TAX (APPEALS)-1,

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WP(C)/7480/2020HC KeralaKLHC01019729202011 March 2020Bench: HONOURABLE MR. JUSTICE AMIT RAWAL4 pages
AI SummaryRemanded

What did the High Court hold?

The High Court disposed of the writ petition with a direction to the appellate authority (Commissioner of Income Tax (Appeals)-1) to consider the stay application within a period of thirty days from the date of receipt of a copy of the judgment. The Court noted that the petitioner had not opted for automatic stay due to the amended provisions of Section 55(4) of the KVAT Act, 2003. Consequently, steps for recovery of amounts pertaining to the impugned order were directed to be kept in abeyance until the stay application is disposed of. The Court clarified that this interim arrangement is solely until the adjudication of the stay application and does not preclude the appellate authority from deciding the appeal along with the stay application. The ratio is that revenue recovery should be stayed pending the disposal of a stay application, especially when the petitioner has not opted for automatic stay under amended provisions.

What were the facts?

The petitioner, The Cochin Malabar Estates and Industries Limited, filed an appeal against an order dated for the assessment year 2014-15 under the Kerala Value Added Tax (KVAT) Act. The petitioner also filed a stay application along with the appeal. The grievance of the petitioner is that the respondent Income Tax Officer is proceeding with revenue recovery actions before the stay petition has been considered. This situation has led the petitioner to approach the High Court. The Court notes that several similar writ petitions are pending before it concerning the non-hearing of appeals and stay applications.

What were the issues?

1. Whether the respondent Income Tax Officer can proceed with revenue recovery actions while a stay application filed along with an appeal is pending adjudication, under the Kerala Value Added Tax Act, 2003? Assessee's Contention: The petitioner argues that revenue recovery proceedings should be halted until the stay application is considered and disposed of. They have approached the Court due to the imminent threat of recovery actions before their appeal and stay application are heard. Revenue's Contention: The judgment does not record any specific contentions from the revenue regarding this issue. However, the action of proceeding with recovery suggests a stance that such actions are permissible pending the disposal of the stay application.

Which sections of the Income-tax Act were involved?

Section 55(4)

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE AMIT RAWAL WEDNESDAY, THE 11TH DAY OF MARCH 2020 / 21ST PHALGUNA, 1941 WP(C).No.7480 OF 2020(H) PETITIONER: THE COCHIN MALABAR ESTATES AND INDUSTRIES LIMITED, COWCOODY CHAMBERS, 234A, RACE COURSE ROAD, COIMBATORE - 641 018. REPRESENTED BY ITS DIRECTOR MR.CHANDRA PRAKASH SHARMA. BY ADVS. SRI.A.KUMAR SRI.P.J.ANILKUMAR SMTG.MINI(1748) SRI.P.S.SREE PRASAD SHRI.JOB ABRAHAM SRI.AJAY V.ANAND RESPONDENTS: 1 THE COMMISSIONER OF INCOME TAX (APPEALS)-1, POORNIMA BUILDINGS, MANORAMA JUNCTION, PANAMPILLY NAGAR, KOCHI - 682 036. 2 INCOME TAX OFFICER, (CORPORATE) WARD 2 (4), KOCHI - 682 018. OTHER PRESENT: GP DR THUSHARA JAMES THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 11.03.2020, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

WP(C).No.7480 OF 2020 -2- JUDGMENT As against Ext.P1 order for the assessment year 2014-15 under the Kerala value Added Tax Act, petitioner preferred Ext.P2 appeal along with the stay application. The case of the petitioner is that, the 2nd respondent is proceeding further with the revenue recovery prior to considering the stay petition, which impelled the petitioner to approach this Court. 2. This Court in W.P.(C) No.3800/2020 had passed a detailed order after having called the Assistant Commissioner of Law in court with regard to the numbering of appeal and hearing of the stay application. Several writ petitions are pending in this Court seeking redressal of grievance for non- hearing of the appeal, along with stay applications. 3. This writ petition is also of the similar nature and the petitioner is in dilemma. In such circumstances, this Court cannot sit as a mute spectator without coming to the rescue of such litigants.

WP(C).No.7480 OF 2020 -3- 4. Accordingly, I dispose of this writ petition with a direction to the appellate authority to consider the application of stay within a period of thirty days from the date of receipt of a copy of this judgment as the petitioner in such circumstances had not opted for automatic stay in view of the amended provisions of Section 55 (4) of KVAT Act, 2003. Steps for recovery of amounts pertaining to Ext.P1 shall be kept in abeyance, till such time the stay application is disposed of. It is made clear that the interim arrangement is only till the adjudication of the stay application. However, this will not stand in the way of the appellate authority deciding the appeal along with the stay application. Sd/- AMIT RAWAL vv JUDGE

WP(C).No.7480 OF 2020 -4- APPENDIX PETITIONER'S/S EXHIBITS: EXHIBIT P1 TRUE COPY OF THE ORDER OF ASSESSMENT DATED 31/12/2019. EXHIBIT P2 TRUE COPY OF THE MEMORANDUM OF APPEAL DATED 28/01/2020. EXHIBIT P3 TRUE COPY OF THE APPLICATION FOR STAY DATED 10/02/2020. //TRUE COPY// PA TO JUDGE

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