T.ABDUL MAJEED vs. THE DEPUTY COMMISSIONER OF INCOME TAX

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WP(C)/30342/2013HC KeralaKLHC01073526201310 December 2013Bench: HONOURABLE MR.JUSTICE V.CHITAMBARESH4 pages
AI SummaryRemanded

What did the High Court hold?

The High Court directed the second respondent (Commissioner of Income Tax) to consider the waiver petitions filed by the petitioner (Ext.P2 series) within a period of three months. This consideration is made subject to the condition that the petitioner clears the tax liability, excluding interest, within one month from the date of the order. The court did not decide on the merits of the waiver petitions themselves but rather on the procedural step for their consideration. The ratio of the decision is that a taxpayer seeking waiver of interest under Section 220(2A) must first clear the principal tax demand, but the authority can proceed to consider the waiver application if the taxpayer undertakes to clear the tax component within a stipulated period, while the waiver application is being processed. The petitioner was also directed to furnish a copy of the writ petition and the judgment to the second respondent for compliance.

What were the facts?

The petitioner, T. Abdul Majeed, proprietor of Fair Pharma, filed a writ petition before the High Court of Kerala seeking waiver of interest under Section 220(2A) of the Income Tax Act, 1961. The petitioner had filed waiver petitions (Ext.P2 series) before the Commissioner of Income Tax (2nd respondent) for assessment years 1994-95 and 1996-97. The assessment orders for these years were passed by the Deputy Commissioner of Income Tax (1st respondent) on March 1, 2010. The respondents contended that the tax liability must be cleared before seeking waiver of interest. The petitioner, however, maintained that there was no outstanding tax liability, only interest.

What were the issues?

1. Whether the petitioner is entitled to seek waiver of interest under Section 220(2A) of the Income Tax Act, 1961, when there is a dispute regarding the outstanding tax liability. Assessee's Contention: The petitioner argues that there is no outstanding tax liability, and therefore, the condition of clearing tax liability before seeking waiver of interest is met. The petitioner relies on Section 220(2A) of the Income Tax Act, 1961, for seeking waiver of interest. Revenue's Contention: The respondents contend that the petitioner must first clear the tax liability before any waiver of interest can be considered. No specific authorities or precedents were mentioned by the revenue in the judgment.

Which sections of the Income-tax Act were involved?

Section 220(2A)

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR.JUSTICE V.CHITAMBARESH TUESDAY, THE 10TH DAY OF DECEMBER 2013/19TH AGRAHAYANA, 1935 WP(C).No. 30342 of 2013 (P) ---------------------------- PETITIONER -------------------------- T.ABDUL MAJEED PROPRIETOR, FAIR PHARMA, BROADWAY KOCHI-682031. BY ADVS.SRI.K.M.V.PANDALAI SMT.S.HEMALATHA RESPONDENT(S): ---------------------------- 1. THE DEPUTY COMMISSIONER OF INCOME TAX CIRCLE-2 (1) C.R. BUILDINGS, I.S. PRESS ROAD ERNAKULAM, KOCHI-682018. 2. THE COMMISSIONER OF INCOME-TAX C.R. BUILDINGS, I.S. PRESS ROAD, ERNAKULAM KOCHI-682018. BY ADV. SRI. JOSE JOSEPH, SC INCOME TAX THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 10-12- 2013, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

WP(C).No. 30342 of 2013 (P) ---------------------------- APPENDIX PETITIONER(S)' EXHIBITS ------------------------------------- EXT.P1. TRUE COPY OF THE ASSESSMENT ORDER DATED 1-3-2010 PASSED BY THE 1ST RESPONDENT FOR THE YEAR 1994-95. EXT.P1A. TRUE COPY OF THE ASSESSMENT ORDER DATED 1-3-2010 PASSED BY THE 1ST RESPONDENT FOR THE YEAR 1996-97 EXT.P2. TRUE COPY OF THE WAIVER PETITION FILED BY THE PETITIONER ON 5-4-2010 BEFORE THE 2ND RESPONDENT FOR THE ASSESSMENT YEAR 94-95 EXT.P2(a). TRUE COPY OF THE WAIVER PETITION FILED BY THE PETITIONER ON 5-4-2010 BEFORE THE 2ND RESPONDENT FOR THE ASSESSMENT YEAR 96-97. RESPONDENT(S)' EXHIBITS --------------------------------------- NIL TRUE COPY P.A TO JUDGE SMM

V.CHITAMBARESH,J. = = = = = = = = = = = W.P.(C) No.30342 of 2013 = = = = = = = = = = = == = = = = Dated this the 10th day of December, 2013

J U D G M E N T The petitioner has filed Ext.P2 series petitions seeking waiver of interest. The petitioner calls in aid Section 220(2A) of the Income Tax Act, 1961 for this purpose. The respondents point out that the tax liability has to be cleared by the petitioner before seeking waiver. The petitioner however asserts that there is no outstanding liability towards the component of tax. 2. I direct the second respondent to consider Ext.P2 series petitions with notice to the petitioner within a period of three months. This is subject to the condition that the petitioner clears the tax liability (excluding interest) within a period of one month. 3. The petitioner shall produce a copy of the writ petition with the judgment before the second respondent for compliance. The writ petition is disposed of. V.CHITAMBARESH JUDGE smm

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