M/S. PALANATTIL CONSTRUCTION COMPANY vs. UNION OF INDIA

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WA/1460/2014HC KeralaKLHC01045065201431 October 2014Bench: HONOURABLE MR. JUSTICE ANIL K.NARENDRAN,HONOURABLE MR.JUSTICE ANTONY DOMINIC3 pages
AI SummaryDismissed

What did the High Court hold?

The High Court held that the appellant's claim for adjustment of amounts due from the department towards its tax liability for assessment year 2002-03, made through an application under Section 119(2)(b) of the Income Tax Act, was not maintainable. This was primarily because the claim was admittedly made beyond the outer time limit of 6 years provided by Instruction No. 13/2006 issued under Section 119(2)(b). The Court also noted that the assessment for AY 2002-03 was completed under Section 144 due to the appellant's non-response to statutory notices, and crucially, the appellant had not filed any return for that assessment year. In the absence of a filed return, the Court found that a claim for adjustment or refund could not be sustained. Consequently, the Court found no illegality in the view taken by the learned single Judge who had dismissed the writ petition. The writ appeal was dismissed.

What were the facts?

The appellant, M/s. Palanattil Construction Company, filed a writ appeal challenging the dismissal of its writ petition by a learned single judge. The writ petition primarily challenged an order (Ext.P6) that declined the appellant's request for adjustment of certain amounts allegedly due to it from the department towards its tax liability for the assessment year 2002-03. The assessment for AY 2002-03 was completed under Section 144 of the Income Tax Act due to the appellant's non-response to notices issued under Sections 148 and 142. Subsequently, the appellant filed an application under Section 119(2)(b) seeking adjustment, which was rejected. The appellant had not filed any return for the assessment year 2002-03.

What were the issues?

1. Whether the appellant's claim for adjustment of amounts due from the department towards its tax liability for assessment year 2002-03, made through an application under Section 119(2)(b) of the Income Tax Act, is maintainable when filed beyond the outer time limit of 6 years prescribed by Instruction No. 13/2006 issued under the said section. 2. Whether the assessment completed under Section 144 of the Income Tax Act, in the absence of any response from the assessee to notices under Sections 148 and 142, and without the filing of a return for the assessment year 2002-03, precludes the assessee from maintaining a claim for adjustment or refund. Assessee's contentions: The appellant sought adjustment of amounts allegedly due to it from the department towards its tax liability for AY 2002-03. The appellant filed an application under Section 119(2)(b) for this purpose. Revenue's contentions: The learned standing counsel for the respondents pointed out that the appellant did not respond to notices issued under Sections 148 and 142, leading to assessment under Section 144. The claim for adjustment under Section 119(2)(b) was made beyond the 6-year time limit stipulated by Instruction No. 13/2006. Furthermore, no return had been filed for AY 2002-03, making a claim for adjustment or refund unsustainable.

Which sections of the Income-tax Act were involved?

Section 148,Section 142,Section 144,Section 119(2)(b)

AI-generated summary — verify with the full judgment below

Heard together (3 matters)

WA.No. 1460 of 2014
WP(C).33095/2010
W.P.33095/10

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 ANTONY DOMINIC & THE HONOURABLE MR. JUSTICE ANIL K.NARENDRAN FRIDAY, THE 31ST DAY OF OCTOBER 2014/9TH KARTHIKA, 1936 WA.No. 1460 of 2014 () IN WP(C).33095/2010 -------------------------------------------- AGAINST THE ORDER/JUDGMENT IN WP(C) 33095/2010 of HIGH COURT OF KERALA DATED 20-08-2014 APPELLANT(S)/PETITIONER: -------------------------------------------- M/S. PALANATTIL CONSTRUCTION COMPANY, REVIEW BUILDING, KURISSADI JUNCTION, NALANCHIRA THIRUVANANTHAPURAM, REP. BY ITS MANAGING PARTNER P.P.PAULOSE.

BY ADV. SRI.M.RAMASWAMY PILLAI RESPONDENT(S)/RESPONDENTS: -------------------------------------------------- 1. UNION OF INDIA, REP. BY ITS SECRETARY, TAXES, NEW DELHI-110011. 2. COMMISSIONER OF INCOME TAX, AAYAKAR BHAVAN, KOWDIAR P.O. THIRUVANANTHAPURAM-695004. 3. THE INCOME TAX OFFICER (TECH), AAYAKAR BHAVAN, KOWDIAR P.O. THIRUVANANTHAPURAM-695004. 4. THE INCOME TAX OFFICER, WARD-2, INCOME TAX OFFICE, KOLLAM-691001. 5. THE TAX RECOVERY OFFICER, AAYAKAR BHAVAN, KOWDIAR, THIRUVANANTHAPURAM PIN-695004.

6.

THE CENTRAL BOARD OF DIRECT TAXES, REPRESENTED BY ITS SECRETARY, NEW DELHI 110011. (ADDL.R6 IMPLEADED AS PER ORDER DT 23.11.2010 IN IA 15713/2010 IN W.P.33095/10) BY SRI.JOSE JOSEPH, SC, FOR INCOME TAX THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 31-10-2014, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

ANTONY DOMINIC & ANIL K. NARENDRAN, JJ. =============================== Writ Appeal No. 1460 of 2014 ==================== Dated this the 31st day of October, 2014 J U D G M E N T Antony Dominic, J. Appellant is the petitioner in WP(C) No.33095/2010. He has filed this appeal challenging the judgment of the learned single Judge dismissing the writ petition. The writ petition was filed mainly challenging Ext.P6, whereby his request for adjustment as prayed for in Ext.P5 was declined. 2. We heard the learned counsel for the appellant and also the learned standing counsel appearing for the respondents. 3. Essentially what the appellant wants is an adjustment of certain amounts which are allegedly due to him from the department towards his liability of tax for the assessment year 2002-03. However, as rightly pointed out by the learned standing counsel, despite the notices issued under Sections 148 and 142 of the Income Tax Act, since there was no response from the appellant, assessment was completed under Section 144 of the Income Tax Act as per Ext.P1 order. It was thereafter that the assessee has filed the application under Section 119(2)(b) of the Income Tax Act, a copy of

W.A.No.1460/14 : 2 : which is Ext.P5 where he sought adjustment of certain amounts which are claimed to be due. It was this request that was rejected by the department by Ext.P6. 4. As rightly pointed out by the learned counsel, as per instruction No.13/2006 issued under Section 119(2)(b) of the Income Tax Act, outer time limit of 6 years is provided for making any claims under the said section. Admittedly, Ext.P5 claim was made beyond the said time limit. Even as on date, the assessee has not filed any return concerning the assessment year 2002-03 and in the absence of any return, we cannot maintain a claim for adjustment or refund. 5. In sum and substance, we do not find any illegality in the view taken by the learned single Judge. Writ appeal is dismissed.

Sd/- ANTONY DOMINIC JUDGE Sd/- ANIL K. NARENDRAN

JUDGE Rp //True Copy// PA to Judge

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