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The High Court observed that since the stay petition was pending before the appellate authority, it was appropriate to pass a decision in the case. The Court disposed of the writ petition by directing the 2nd respondent (Commissioner of Income Tax (Appeals)) to take up the stay petition (Ext.P4) and pass appropriate orders thereon within three months from the date of receipt of the judgment. This was to be done after affording the petitioner a reasonable opportunity of being heard. Until such time as the stay petition is decided, further proceedings pursuant to the assessment order (Ext.P1) and the demand notice (Ext.P5) were to be kept in abeyance. The Court did not decide on the merits of the assessment order itself.
The High Court, while hearing the Writ Appeal, did not interfere with the learned Single Judge's decision to relegate the appellant to the alternate remedy of filing an appeal before the Income Tax Appellate Tribunal (ITAT). However, the Court modified the impugned judgment to protect the appellant from immediate recovery proceedings. The Court clarified that pending the disposal of the appeal by the ITAT, recovery proceedings for any amount confirmed against the appellant by the First Appellate Authority's order shall be kept in abeyance. This relief is conditional upon the appellant filing the appeal before the ITAT within one month from the date of the order.
The High Court noted the submission by the learned counsel for the respondents that the PAN number "AABACW0980B" has been made operational. In light of this submission, the Court found that nothing further survived in the writ petition. Consequently, the writ petition was closed. The petitioner was advised to file an appeal against the assessment orders in respect of the said PAN number "AABACW0980B". The Court did not delve into the merits of the assessment orders or the demand notices, nor did it decide on the legality or arbitrariness of the impugned orders. The operative direction was to allow the petitioner to proceed with filing their appeal now that the procedural hurdle of PAN operationalization was stated to be resolved.
The High Court allowed the writ petition. It directed respondents 1 and 2 (Income Tax Department) to hand over the title documents to the petitioner. This was to be done upon obtaining a proper receipt from the petitioner and a bond from him. The bond would indemnify the Income Tax Department against any future claims that might be made by the 3rd respondent concerning the property or the documents. The Court noted that the 3rd respondent had chosen not to appear before the Court or be represented by counsel, which led the Court to infer that he had nothing to oppose the petitioner's claim. The revenue had no objection to handing over the documents to the petitioner, provided they were protected against future claims.
The High Court of Kerala disposed of the writ petition with a direction to the 4th respondent, the Income Tax Appellate Tribunal, Cochin Bench, to consider and dispose of the pending Exhibit P3 appeal and Exhibit P4 stay application expeditiously, preferably within a period of four months. In the event that the appeal could not be disposed of within the four-month period, the Court directed that at least the stay application should be disposed of within the said period. The Court did not decide on the merits of the assessment order or the appeal itself, but rather on the procedural aspect of ensuring timely disposal by the appellate authority. No issue was expressly left undecided.
The High Court declined to issue a writ of mandamus directing the respondents to refrain from recovery proceedings. The Court stated that it would not exercise parallel jurisdiction with the appellate authority. However, the Court directed the 3rd respondent, the CIT (Appeals), to consider and pass appropriate orders on the petitioner's stay applications (Exhibit P-5 and P-6) expeditiously, preferably within a period of two months. For a period of two months from the date of the order, the demand of tax pursuant to the assessment orders (Exhibit P-1 and P-3) shall not be enforced. The issue of the merits of the appeals themselves was not decided by the High Court, as the petition was disposed of on procedural grounds related to the stay applications.
The High Court modified the judgment of the learned Single Judge. While the Single Judge had directed the expeditious disposal of the appeal by the appellate authority but did not grant a stay of recovery, the Division Bench found it incumbent upon the Single Judge to protect the appellant from recovery proceedings pending the appeal's disposal. Therefore, the High Court clarified that pending the disposal of the appeal by the appellate authority, the recovery proceedings against the appellant for the amounts confirmed by Ext.P1 assessment order shall be kept in abeyance. The rest of the directions in the impugned judgment were not interfered with. The ratio decidendi is that when an assessee approaches the High Court under Article 226 against an assessment order and has filed a statutory appeal and stay petition, the High Court should, at a minimum, protect the assessee from coercive recovery actions pending the disposal of the statutory appeal, if there is an apprehension of such action.
The High Court of Kerala, considering the petitioner's submission of compelling circumstances for his non-appearance and non-filing of reply, directed the petitioner to appear before the Commissioner of Income Tax (Exemptions), Ernakulam, on January 5, 2024, with all relevant documents. The Commissioner was empowered to seek further documents if necessary and then pass appropriate orders on the Section 12A application after hearing the petitioner. The Court explicitly stated that if the petitioner fails to appear on the given date or produce required documents, no further opportunity would be granted, and the impugned order would stand. The writ petition was disposed of with these directions.
The High Court of Kerala held that there were no grounds to entertain the writ petition at this stage. The Court noted that the petitioner had failed to file a reply to the notice issued under Section 148 of the Act and had not filed its income tax return for Assessment Year 2016-17. The Court observed that the petitioner's claims regarding exemption under Section 80P and the inconsistencies in financial transaction details were matters to be addressed by filing a proper reply and return before the assessing authority. The Court permitted the petitioner to file a reply to the Section 148 notice and the income tax return within twenty-one days. If the petitioner complied, the assessing authority was directed to consider the submissions and provide an opportunity of hearing before passing a final order. The Court explicitly stated that no further opportunity would be granted for filing the reply or return. The writ petition was disposed of with these directions.
The High Court held that the penalty orders passed under Sections 271(1)(c) and 271AAB of the Income Tax Act, 1961, must be revised in light of the fresh assessment orders that would be passed on remand. The Court reasoned that the revenue did not dispute this fact, and the assessee's submission was accepted. The ratio decidendi is that penalty orders are consequential to assessment orders, and any revision in the assessment necessitates a review of the penalties. The Court directed the respondent (Assistant Commissioner of Income Tax) to revise the penalty orders after fresh/revised assessment orders are passed for assessment years 2008-09 to 2014-15. The petitioner was to be afforded an opportunity of hearing as per Section 75(1A) before revising the penalty orders. The Assessing Officer was directed to expedite the revision proceedings, preferably within one month.
The High Court allowed the Writ Petition and set aside the impugned orders dated 05.04.2023. The Court held that the phrase 'provide an opportunity of being heard to the assessee' as used in Clause (b) of Section 148 of the Income Tax Act implies an opportunity for personal hearing. Since this opportunity was not granted to the petitioner before the passing of the impugned orders, the orders were vitiated. The matter was remanded back to the respondent Income Tax Officer to provide an opportunity of hearing to the petitioner and pass fresh orders under Section 148A(d) of the Income Tax Act. The petitioner was directed to appear on 10.01.2024. The Assessing Officer is to pass fresh orders after considering the petitioner's submissions and then proceed further if required for issuing notice under Section 148. No other issue was expressly left undecided.
The High Court found no grounds to entertain the writ petition in its present form, as the petitioners had not yet responded to the show cause notices issued to them. The Court directed the petitioners to file their reply to the show cause notices (Exhibits P-1 to P-6) within one week. After considering the petitioners' reply and supporting documents, the second respondent (Tax Recovery Officer) was to issue a fresh notice if any amount was still due. The Court also ordered that no coercive measures would be taken against the petitioners for realizing the amounts mentioned in the impugned notices until a decision is taken after the petitioners file their reply. The principle established is that statutory remedies, such as responding to show cause notices, must be exhausted before approaching the writ court, especially when the primary issue involves factual verification of tax liability.
The High Court held that the assessment order and subsequent notices were liable to be set aside due to a violation of the principles of natural justice. The Court found that granting only one day's time to the petitioner to file a reply to the show cause notice dated 30.03.2022, along with the draft assessment order, constituted virtually no opportunity. The Court reasoned that this short timeframe violated the fundamental right to be heard. Consequently, the Court permitted the petitioner to file a reply to the show cause notice dated 30.03.2022 within seven days from the date of the order. The petitioner was to be granted seven days from the date a link is provided for uploading the reply. After receiving the reply, the final assessment order was to be passed after giving an opportunity of hearing. The Court directed that the link for uploading the reply should be intimated on the petitioner's registered email ID. The petitioner was also directed not to raise the objection regarding time-barred assessment as the matter was remanded. The assessment order in Exhibit P-7 and subsequent notices were set aside.
The High Court held that it cannot exercise parallel jurisdiction with the appellate authority under Article 226 of the Constitution of India. While the petitioner sought a writ of mandamus to keep coercive proceedings in abeyance, the court found that such intervention was not appropriate. The court acknowledged that it is incumbent upon the appellate authority to decide the stay application of the petitioner at the earliest. Therefore, the writ petition was disposed of with a direction to the National Faceless Appeal Centre (NFAC), the 2nd respondent, to consider and pass appropriate orders on the stay application (Ext.P17) pending before it, in accordance with law, preferably within a period of two months. No decision was made on the merits of the assessment or the appeal itself. Any pending interlocutory applications in the writ petition were dismissed.
The High Court of Kerala, in these writ petitions, has followed the judgment of the Division Bench of the Madras High Court in M/s Jain Metal Rolling Mills v. Union of India. Consequently, the Court has read down Section 245C(5) of the Income Tax Act, 1961, by removing the retrospective last date of February 1, 2021, and substituting it with March 31, 2021. This amendment also impacts the eligibility date mentioned in the impugned circular dated September 28, 2021, which is now also to be considered as March 31, 2021. All applications, including those arising between February 1, 2021, and March 31, 2021, are to be deemed pending applications for consideration by the Interim Board. Orders rejecting applications solely on the ground that they did not have a case pending as on January 31, 2021, are set aside. Such applications are to be deemed pending and dealt with on merits in accordance with law. The impugned orders are set aside, and the cases are remitted back to the competent respondent for fresh decisions.
The High Court of Kerala, following the judgment of the Division Bench of the Madras High Court in M/s Jain Metal Rolling Mills v. Union of India, allowed the writ petitions. The Court held that Section 245C(5) of the Income Tax Act, 1961, as amended by the Finance Act, 2021, should be read down by removing the retrospective last date of February 1, 2021, and substituting it with March 31, 2021. Consequently, the last date of eligibility mentioned in paragraph 4(i) of the impugned circular dated September 28, 2021, was also deemed to be March 31, 2021. All applications, including those arising between February 1, 2021, and March 31, 2021, were to be considered pending applications for the purpose of consideration by the Interim Board. Orders rejecting applications solely on the ground that they did not have a case pending as on January 31, 2021, were set aside and deemed to be pending applications for consideration by the Interim Board, if otherwise eligible. The cases were remitted back to the competent respondent for fresh decisions on the applications in light of the Madras High Court's judgment.
The High Court held that the petitioner's submission that the assessment orders were finalized merely on the basis of retracted statements was incorrect. The Court observed that the assessment orders indicated that not only the statements of the Director and Managing Director but also other incriminating material, including excel sheets and digital data from computers and laptops, were examined before adding the undisclosed income. Therefore, the Court found no substantial merit in the writ petition regarding the non-consideration of the assessment order's merits by the appellate authority in the impugned stay order. The Court dismissed the writ petition but extended the time for payment of the first installment to 30.12.2023 and the final installment to 30.06.2024. The Court clarified that its observations would not prejudice the appellate authority's consideration of the case on merit.
The High Court held that the order passed by the Principal Commissioner of Income Tax-1 (2nd respondent) was without jurisdiction. According to Circular No. 9/2015, applications under Section 119(2)(b) of the Income Tax Act where the claim for refund is not more than Ten Lakhs for any assessment year are to be considered by the Principal Chief Commissioner of Income Tax. In this case, the petitioner's claim for refund exceeded Ten Lakhs, meaning the jurisdiction to consider the application was not vested with the Principal Commissioner of Income Tax-1. Consequently, the impugned order (Ext.P10) was set aside, and the matter was remitted back to the Principal Chief Commissioner (4th respondent) for consideration and decision on the petitioner's application (Ext.P8) expeditiously within two months.
The High Court directed the second respondent (NFAC) to consider and dispose of the stay petitions (Ext.P3 series) expeditiously, at any rate within three months from the date of receipt of a certified copy of the judgment, after affording the petitioner an opportunity of being heard. The Court further stipulated that if the NFAC proposed to pass a conditional order of stay, it must state the reasons for the same. Crucially, the Court ordered that until orders were passed on the stay petitions, all further proceedings pursuant to the assessment orders (Ext.P1 series) shall stand deferred. The appeals themselves (Ext.P2 series) were not directly addressed in terms of their disposal timeline, but the deferral of proceedings pending the stay order implicitly impacts their progression.
The High Court directed the second respondent (Commissioner of Income Tax (Appeals)) to consider and dispose of the delay petition (Ext P4) expeditiously, within three months from the date of receiving a certified copy of the judgment, after providing the petitioner an opportunity to be heard. If the delay is condoned, the second respondent is then to simultaneously consider and dispose of the stay petition (Ext P3), also after affording the petitioner an opportunity of being heard. The Court also noted that if a conditional stay order is proposed, reasons must be provided. Crucially, until orders are passed on the delay and stay petitions, all further proceedings pursuant to the assessment order (Ext P1) are to be deferred. The High Court did not decide the merits of the assessment order or the appeal itself, but rather focused on procedural directions for the appellate authority.
The High Court held that the reopening of assessment ordered by the Assessing Authority cannot be said to be without jurisdiction. The court reasoned that the Assessing Authority, after considering the objections raised by the appellant, had formed an opinion that the appellant's income had escaped assessment, thereby necessitating the reopening of the assessment for the assessment year 2019-2020. The court found no merit in the writ appeal, stating that the appellant was free to raise all contentions in response to the notice issued under Section 148. The High Court dismissed the appeal but extended the time granted by the learned Single Judge for filing the response and return by one month from the date of the judgment.
The Court held that there was no violation of the principles of natural justice. The petitioner had requested time until 20.05.2023 for the first show cause notice, which was implicitly granted as per Exhibit P-8. The petitioner did not file a reply by this extended date. Although a second show cause notice was issued, the petitioner again asked for time and failed to file a reply. The Court found that the petitioner could not continuously seek extensions for responding to show cause notices. Therefore, the Authority was within its power not to grant further time. The Court found no ground to interfere with the impugned order or notice. The petitioner was granted liberty to file an appeal against the assessment order within fifteen days from the date of the order, and the Appellate Authority was directed to consider the appeal on merits, including any stay application, without raising the issue of limitation. No coercive steps were to be taken against the petitioner for fifteen days concerning the assessment order. The stay application was to be decided expeditiously, preferably within two months.
The High Court directed the 3rd respondent, the Commissioner of Income Tax (Appeals), to consider and pass appropriate orders on the delay condonation and stay applications filed along with the appeals expeditiously, preferably within two months. The Court further ordered that no recovery shall be effected from the petitioner in respect of the assessment orders until the appeals are decided. The Court did not decide the merits of the addition made under Section 69A but granted interim relief. The principle established is that in cases where appeals are pending with applications for delay condonation and stay, and the assessee raises a prima facie case regarding the factual basis of the addition, the appellate authority should be directed to consider these applications expeditiously, and recovery should be stayed pending such consideration.
The High Court held that it would not entertain parallel proceedings when an appeal against an assessment order is already pending before the first appellate authority. Therefore, there was no ground to entertain the writ petition, except for a direction to the first respondent (Commissioner of Income Tax (Appeals)) to consider and pass appropriate orders on the pending appeal expeditiously, preferably within six months. The operative direction was to dispose of the appeal within the stipulated time. No specific issue regarding the merits of the appeal or the assessment was decided.
The High Court held that the contention of the petitioner that since the dissolved partnership was not taxed when the asset came into the hands of the petitioner as a result of dissolution, the subsequent sale by the petitioner is not liable to be taxed for capital gain, is unconvincing. The Court reasoned that the point of sale of the capital asset is the taxable event for capital gains. After the property vested in the petitioner upon dissolution on 15.7.2011, the petitioner became the owner, and the subsequent sale on 3.7.2012 constituted a taxable transfer. The Court also found that the notice dated 28.6.2021 for reopening the assessment was issued within the extended period up to 30.6.2021, as per Section 149 of the Act and relevant notifications. Therefore, the writ petition was dismissed. The petitioner was permitted to file his return in response to the final notice under Section 148 within thirty days, after which the assessing authority would proceed to determine the tax liability.
The High Court observed that the petitioner had already filed an appeal against the assessment order with a significant delay. Consequently, the Court directed that the Appellate Authority should consider the appeal in accordance with the law and expeditiously. The Court did not explicitly rule on the technical defect or the method of computing delay, but rather disposed of the writ petition by directing the appellate authority to proceed with the already filed appeal. The primary focus shifted to the appellate process itself, acknowledging the existence of a delayed appeal that needed adjudication.
The High Court held that considering the long pendency of the appeal against the assessment order since 2018, it would be appropriate to dispose of the writ petition with a direction to the Third Respondent (Commissioner of Income Tax (Appeals), National Faceless Centre, New Delhi) to decide the appeal expeditiously, preferably within a period of two months, in accordance with the law. The Court did not explicitly address the prayer to keep recovery proceedings in abeyance, but the reasoning implies that the expeditious disposal of the appeal is the primary focus. The Court noted that the petitioner had not complied with the conditions for the stay order, meaning no stay was in operation, and the revenue was free to recover the demand. The ratio decidendi is that prolonged pendency of appeals warrants judicial intervention for expeditious disposal.
The High Court set aside the impugned order of the ITAT dated 03.07.2023. The Court directed the appellant to file an additional affidavit explaining the reasons for the delay in filing the appeal before the ITAT within two weeks from the date of the order. Upon receipt of this affidavit, the ITAT was directed to consider the appellant's application for condonation of delay within a further period of three weeks, after hearing the appellant. The Court explicitly stated that the Income Tax Appeal was disposed of without answering the questions of law raised. The principle derived is that procedural technicalities, especially concerning delay condonation, should not automatically lead to dismissal without exploring avenues for rectification, provided no prejudice is caused to the other party.
The High Court allowed the writ petitions. The Court quashed the impugned orders dated March 24, 2023, and March 31, 2022, passed under Section 148A(d) of the Income Tax Act, 1961, and the notices issued under Section 148 of the Act. The decision was based on the concession made by the Revenue that a mistake had occurred in the issuance of these orders and notices. The operative direction was to quash the impugned orders and notices. No specific issue was left undecided.
The High Court of Kerala allowed the writ petitions. The Court quashed the impugned Ext.P1 orders dated 24.03.2023 and 31.03.2022 passed under Section 148A(d) of the Income Tax Act, 1961, and the Ext.P2 notices under Section 148 of the Act, which were challenged in the respective writ petitions. This decision was based on the concession made by the learned Standing Counsel for the Income Tax Department that a mistake had occurred in the issuance of these orders and notices. The ratio decidendi is that where the revenue concedes to an error in its proceedings, the court will intervene to quash such erroneous actions. No specific issue was left undecided.
The High Court held that the petitioner was not afforded an adequate and effective opportunity of being heard, as directed by the ITAT, and that there was a violation of the principles of natural justice in finalizing the assessment and penalty orders. The Court reasoned that the circumstances noted by the ITAT in its earlier remand order (Treasurer in judicial custody, inability to make effective representation) persisted when the impugned orders were passed. Consequently, the writ petitions were allowed, and the impugned assessment and penalty orders were set aside. The matter was remanded back to the Assessing Authority to pass a fresh order after considering the reply to be filed by the assessee and the documents produced. The petitioner was granted three weeks to file the reply and produce evidence, with a clear direction that no further opportunities would be granted for filing replies or producing documents, and only one opportunity of hearing would be provided before finalizing the assessment.
The High Court disposed of the writ petition with liberty to the petitioner to file an appeal before the Appellate Authority under the provisions of the Income Tax Act, 1961, against the assessment order and the penalty order. This includes filing an application for condonation of delay and an application for stay. The petitioner was granted three weeks to file these documents. The Appellate Authority was directed to provide the petitioner with a link for uploading the appeal and applications. Crucially, the Court ordered that further proceedings for the sale of the attached immovable properties would be stayed only until a decision was taken on the application for condonation of delay and stay by the Appellate Authority. The Court did not decide on the merits of the assessment or penalty orders themselves.
The High Court dismissed the writ petition, finding no grounds to interfere. The Court noted that the petitioner still had nine days left to file a response to the show cause notice dated October 31, 2023, which was issued under Section 144 of the Income Tax Act, 1961. The Court held that there was no error of jurisdiction or violation of the principles of natural justice. The reasoning was based on the procedural stage of the proceedings, where the assessee had not yet exhausted their opportunity to respond to the final show cause notice. Therefore, the High Court declined to intervene at that juncture. No specific issue was expressly left undecided.
The High Court dismissed the writ appeals, finding no illegality in the impugned judgments of the learned Single Judge. The Court acknowledged that the appeals preferred by the appellant's father against the assessment orders were pending before the Commissioner of Income Tax (Appeals). The Court noted that the appellant could move stay applications before the Appellate Authority and that no such applications had been filed. The High Court granted the appellant one week to file stay applications before the Commissioner of Income Tax (Appeals). The Court directed the Commissioner to consider and dispose of either the stay applications or the appeals themselves within three weeks of receiving the stay applications, after hearing both sides. The ratio decidendi is that a writ court should not interfere with the procedural directions of the tax authorities when statutory remedies, including the filing of stay applications before the appellate authority, are available and have not been exhausted.
The High Court dismissed the writ appeals, finding no illegality in the judgments of the learned Single Judge. The Court acknowledged that the assessees' appeals against the assessment orders were pending before the Commissioner of Income Tax (Appeals) and that they could move stay applications before that authority. The Court noted that the assessees had not filed such stay applications. However, the Court granted a further opportunity, directing that if the appellants prefer stay applications before the Commissioner of Income Tax (Appeals) within one week from the date of the order, the Commissioner shall consider and dispose of either the stay applications or the appeals themselves within a period of three weeks after receipt of the stay applications, after hearing both sides. The core issue of the legality of the 20% pre-deposit condition was not directly decided on merits but was addressed by directing the appellate authority to expedite the disposal of stay applications and appeals.
The High Court dismissed the writ petition. The Court found no ground to entertain the petition against the impugned assessment order. The primary reason for dismissal was the petitioner's failure to respond to statutory notices issued under Section 142(1) and their lack of cooperation with the assessment proceedings. The Court rejected the petitioner's contention of non-receipt of notice, citing the established system for communication of notices and orders. The Court held that the petitioner's argument was not acceptable in view of the system in place. The Court left it open to the petitioner to avail the remedy of appeal or other available remedies and directed that if the petitioner approaches the appellate authority, the appeal should be decided expeditiously in accordance with law.
The High Court dismissed the writ appeals, finding no illegality in the impugned judgments of the learned Single Judge. The Court noted that the appeals preferred by the appellant's father against the assessment orders were pending before the Commissioner of Income Tax (Appeals). The Court observed that the appellant could very well move stay applications before the Appellate Authority and that no such applications had been filed. The Court acknowledged that the learned Single Judge had granted one week's time for the appellant to file stay applications. The High Court directed that if the appellant prefers stay applications before the Commissioner of Income Tax (Appeals) within one week from the date of the order, the Commissioner shall consider and dispose of either the stay applications or the appeals themselves within a period of three weeks after receipt of the stay applications, after hearing both sides. The Court did not decide on the merits of the original assessment or the validity of the 20% demand condition itself, but rather on the procedural recourse available to the appellant.
The High Court held that the Commissioner of Income Tax (Appeals) had not assigned independent reasons for the conditional stay granted in the impugned order (Ext.P5). While the Commissioner acknowledged the High Court's previous direction, the order simply followed a CBDT Circular regarding the deposit of 20% of the demand for an automatic stay. The Court found that this approach did not constitute an adjudication of the stay application and undermined the process. Consequently, the High Court allowed the writ petition, set aside the impugned order dated 22.11.2023, and remanded the matter back to the Commissioner of Income Tax (Appeals) to pass fresh orders in accordance with the law, ensuring that reasons are assigned in support of the decision on the stay petition after affording the petitioner an opportunity of hearing. No issue was expressly left undecided.
The High Court dismissed the writ petition, finding no grounds to entertain it. Regarding the first issue, the Court held that the Principal Commissioner of Income Tax correctly applied Circular No. 9/2015 by dismissing the petitioner's application for condonation of delay. The application was filed beyond the six-year period stipulated in paragraph 3 of the Circular, which specifies that no application for condonation of delay would be entertained beyond this timeframe from the end of the assessment year. Concerning the second issue, the Court found no substance in the challenge made to Circular No. 9/2015. It held that the CBDT has the power to issue such circulars prescribing procedures and limitations for exercising powers, including condoning delays. The Court concluded that the argument challenging the Circular lacked merit. Therefore, the writ petition failed, and the pending interlocutory applications were also dismissed.
The High Court held that if an appellate authority fails to consider one or more grounds taken by the assessee, the order passed by the appellate authority does not automatically become bad in law. The Court stated that the petitioner has a remedy to file a further appeal against the orders and can raise all grounds previously taken before the first appellate authority, as well as additional grounds. The Court found that for the mere non-consideration of one or more grounds by the first appellate authority, the High Court could not exercise its judicial review jurisdiction under Article 226 of the Constitution of India. Consequently, the writ petition was deemed wholly misconceived and dismissed.
The High Court held that there were no grounds to stay the demand determined by the Assessing Authority pending consideration of the appeal before the 2nd respondent Appellate Authority. The Court stated that it would not entertain the writ petition parallel to the appeal pending before the 2nd respondent. The Court found parallel proceedings in the High Court while the appeal and stay application are pending before the 2nd respondent Appellate Authority to be not maintainable. Therefore, the prayer for staying the demand as determined by Exhibit P-1 order was rejected. However, the 2nd respondent was directed to proceed with the appeal and decide the same expeditiously, preferably within a period of one year. The stay application was directed to be decided within a period of two months. With these directions, the writ petition was finally disposed of.
The High Court allowed the writ petition. It set aside the impugned order (Ext.P5) passed by the Principal Commissioner of Income Tax. The matter was remitted back to the file of the first respondent (Principal Commissioner) to decide the revision petition afresh in accordance with the law. The court directed that the petitioner be afforded an opportunity of hearing by the first respondent. The Principal Commissioner was also directed to issue a notice of hearing to the petitioner, and upon receipt, the petitioner was to appear and make submissions. The court's reasoning was based on the concession made by the revenue in its counter affidavit, acknowledging the impropriety of dismissing the revision without considering the merits and the need for rectification of the assessment.
The High Court dismissed the writ petition. The Court found no substance in the petitioner's submission that the Excel sheet was not put to them for explanation, noting that the assessment order recorded the issuance of a notice dated 20.01.2022 and a vague reply from the assessee. The Court held that there was no violation of the principles of natural justice. Consequently, the High Court declined to examine the assessment order on merits in its writ jurisdiction under Article 226 of the Constitution of India. The petitioner was granted liberty to approach the Appellate Authority if advised, with the observation that any appeal filed would be decided in accordance with law.
The High Court held that it had no ground to entertain the writ petition. The Court reasoned that if the petitioner was aggrieved by the rejection of the stay application, the appropriate remedy lay within the framework of the Income Tax Act, not by filing a writ petition before the High Court. The Court emphasized that the High Court was not the appropriate forum for such grievances when a statutory remedy was available. Therefore, the writ petition was dismissed. No specific issue was left undecided; the petition was dismissed on the grounds of maintainability.
The High Court held that the opportunity of being heard provided under Section 148A(b) of the Income Tax Act, 1961, must be construed as a personal hearing. The Court referred to the language of Section 148A(b) and its heading, which implies conducting an enquiry and providing an opportunity before issuing a notice under Section 148. The Court found no substance in the revenue's submission that a personal hearing is not mandatory. Consequently, the impugned Ext.P5 order and Ext.P6 notice were found unsustainable and were set aside. The petitioner was directed to appear before the respondent on 12.12.2023 for a personal hearing, after which the assessing officer was to pass a fresh order and then proceed with the notice under Section 148. The ratio decidendi is that Section 148A(b) mandates a personal hearing for the assessee.
The High Court disposed of the writ petition with directions. It noted the submission by the revenue that the Principal Commissioner (Exemption) is the competent authority to condone the delay, but the application was filed before the Principal Commissioner (2nd respondent). Therefore, the Court granted liberty to the petitioner to file a fresh application before the Principal Commissioner of Income Tax (Exemption) within ten days. The Court directed that if such an application is filed, the Principal Commissioner of Income Tax (Exemption) should consider it on its merits for condoning the delay in filing the return for assessment year 2022-23 and pass an order expeditiously. Additionally, the Court directed the 4th respondent, Commissioner of Income Tax (Appeals), to expeditiously consider the petitioner's application for a stay against the intimation under Section 143(1).
The High Court of Kerala, after hearing the arguments, allowed the petitioner's request to withdraw the writ petition. The Court noted that the petitioner wished to approach the Appellate Authority under the Income Tax Act, 1961, against the assessment order dated March 17, 2023, which was issued under Section 147 read with Section 144B for Assessment Year 2018-19. The respondents did not object to this course of action. Consequently, the writ petition was dismissed as withdrawn. The Court granted the petitioner liberty to approach the Appellate Authority within fifteen days from the date of the order. It further directed that if the appeal is filed within this period, the Appellate Authority should proceed to decide the appeal on its merits. No specific issue regarding the validity of the assessment order itself was decided by the High Court.
The High Court held that the application dated May 31, 2023, for condonation of delay in rectifying the return for Assessment Year 2016-17 should not be treated in isolation. It was viewed as being in continuation of the petitioner's grievances first raised on February 26, 2019, and pursued through the Prime Minister's Office Public Grievance Portal, which led to the refund of Rs. 2,32,549/- for AY 2017-18 and 2018-19. Therefore, the Court considered the application to be on time. The impugned order rejecting the application was set aside. The petitioner was directed to approach the Assessing Authority within ten days to rectify the errors/defects in the return for AY 2016-17, and thereafter, his claim for refund was to be processed in accordance with the law. No specific issue was left undecided.
The High Court held that Section 119(2)(b) of the Income Tax Act, 1961, empowers the Board (and delegated authorities) to admit applications or claims after the expiry of the specified period and deal with them on merits. However, a Division Bench of the same Court in Daisy v. The Principal Commissioner of Income Tax had opined that the delegated power under Section 119(2)(b) and Circular No. 9/2015 does not authorize the Principal Commissioner to consider the merits of the refund application itself. Instead, the focus should be solely on the merits of the application for condonation of delay. Consequently, the impugned orders were found unsustainable and were set aside. The matter was remitted back to the Principal Commissioner of Income Tax to pass fresh orders on the applications for condonation of delay, explicitly stating that the Principal Commissioner should not go into the merits of the petitioner's claims.
The High Court held that the order passed under Section 148A(d) of the Income Tax Act, 1961, was not without jurisdiction. The Court stated that it could not assume the powers of the assessing authority or the appellate authority if the impugned order and notice were within the powers conferred upon those authorities. Given the limited scope of judicial review in quasi-judicial proceedings under the Act, the Court found the writ petition to be not maintainable. The petitioner was granted fifteen days to file her response to the notice under Section 148 and to file her income tax return. The Assessing Officer was permitted to proceed with the finalization of the assessment if the petitioner failed to comply.