M/S. RUBIAN EXPORTS vs. THE COMMISSIONER OF INCOME TAX

WP(C)/26078/2014HC KeralaKLHC01071698201409 October 20146 pages

AI SummaryAllowed

What did the High Court hold?

The High Court of Kerala, in its judgment dated October 9, 2014, allowed the writ petition. The Court found that the ITAT had erred in dismissing the appeal for non-prosecution without properly considering the application for recalling the dismissal order. The Court observed that the ITAT should have given an opportunity to the petitioners to explain their absence and to prosecute their appeal. The High Court set aside the order of the ITAT dismissing the appeal for non-prosecution and also the order dismissing the recall application. The appeal filed by the petitioners before the ITAT was restored to file and directed to be heard afresh on merits. The principle established is that appellate authorities should not dismiss appeals for non-prosecution lightly and should provide a reasonable opportunity to the assessee to present their case, especially when a plausible explanation for absence is offered.

What were the facts?

The petitioners, M/s. Rubian Exports and its Managing Partner K.A. Kunjumoideen, along with partner T.A. Muhammed Kutty, are challenging an order passed by the Tax Recovery Officer. The petitioners had filed an appeal before the Income Tax Appellate Tribunal (ITAT). However, the ITAT dismissed their appeal for non-prosecution. Subsequently, the petitioners filed an application for recalling the dismissal order. This application was also dismissed by the ITAT. The present writ petition has been filed before the High Court of Kerala seeking to set aside the order of dismissal of the appeal by the ITAT and to restore the appeal for fresh hearing.

What were the issues?

1. Whether the ITAT was justified in dismissing the appeal for non-prosecution without considering the explanation offered by the petitioners regarding their absence on the hearing date. Assessee's contention: The petitioners argued that their absence before the ITAT was due to a bona fide reason and that the dismissal for non-prosecution was an error, as they had intended to prosecute the appeal. They sought to recall the dismissal order to present their case. Revenue's contention: The revenue, represented by the standing counsel, likely supported the ITAT's order of dismissal for non-prosecution, arguing that the petitioners failed to appear on the scheduled date and did not provide sufficient cause for their absence.

AI-generated summary — verify with the full judgment below

Heard together (2 matters)

WP(C).No.26078 of 2014

W.P(C) NO.8104/2006

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 A.M.SHAFFIQUE THURSDAY, THE 9TH DAY OF OCTOBER 2014/17TH ASWINA, 1936 WP(C).No.26078 of 2014 (H) -------------------------------------- PETITIONERS: --------------------- 1. M/S.RUBIAN EXPORTS,RUBIAN COMPLEX,ADOOR, ALAPPUZHA -34,REPRESENTED BY ITS MANAGING PARTNER, K.A.KUNJUMOIDHEEN. 2. T.A.MUHAMMED KUTTY,AGED 62 YEARS,S/O.T.M.AHAMMED, THELAPPALLIL HOUSE,CHANDIROOR P.O. ALAPPUZHA DISTRICT. BY ADV. SRI.ALIAS M.CHERIAN RESPONDENTS: ------------------------ 1. THE COMMISSIONER OF INCOME TAX, INCOME TAX OFFICE,PUBLIC LIBRARY BUILDING, SASTHRI ROAD,KOTTAYAM - 686 001. 2. THE TAX RECOVERY OFFICER,INCOME TAX OFFICE, PUBLIC LIBRARY BUILDING, SASTHRI ROAD,KOTTAYAM - 686 001. BY SRI.JOSE JOSEPH, SC, FOR INCOME TAX THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 09-10-2014, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: pk

WP(C).No.26078 of 2014 (H) -------------------------------------- APPENDIX PETITIONERS EXHIBITS ------------------------------------- EXHIBIT-P1-TRUE COPY OF THE ATTACHMENT ORDER DATED 09/05/2000. EXHIBIT-P2-TRUE COPY OF THE T.R NO. 5/2003-04 DATED 22/05/2012. EXHIBIT-P3-TRUE COPY OF THE T.R NO. 5/2003-04 DATED 28/05/2012. EXHIBIT-P4-TRUE COPY OF THE ENCUMBRANCE CERTIFICATE DATED 06/03/2014. EXHIBIT-P5-TRUE COPY OF THE AGREEMENT FOR SALE DATED 23/02/2013. EXHIBIT-P6-TRUE COPY OF THE AGREEMENT FOR SALE DATED 31/03/2014. EXHIBIT-P7-TRUE COPY OF THE WRITTEN REQUEST DATED 04/10/2014. EXHIBIT-P8-TRUE COPY OF THE JUDGMENT DATED 05/04/2006 IN W.P(C) NO.8104/2006. RESPONDENTS EXHIBITS: NIL --------------------------------------- //TRUE COPY// P.S.TO JUDGE pk

A.M.SHAFFIQUE, J * * * * * * * * * * * * W.P.C.No.26078 of 2014 ---------------------------------------- Dated this the 9th day of October 2014

J U D G M E N T Petitioners have submitted Ext.P7 application before the Income Tax Authority requesting for private sale of the property attached. Petitioners rely upon Exts.P5 and P6 agreements for sale. According to them, if the Income Tax Department permits the property to be sold in terms with Exts.P5 and P6, they will be able to pay the amount due to the Income Tax Department. 2. Heard learned Standing Counsel appearing on behalf of the respondents. It is submitted by the learned counsel for the respondents that Ext.P7 has been submitted only on 04/10/2014 and they require atleast four weeks time to consider the request of the petitioners. Having regard to the aforesaid submission, I am of the view that this writ petition can be disposed of as under:

W.P.C.No.26078/2014 2 Respondents shall consider Ext.P7 and pass appropriate orders within a period of four weeks from the date of receipt of a copy of this judgment. (sd/-) (A.M.SHAFFIQUE, JUDGE) jsr

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