According To The Petitioner, In The Year 1998, The 'Karvivadh Samadhan Scheme' Was Introduced v. State Of Kerala (2007 (4)Klt 402) And That Notwithstanding The Suspension Of The Operation Ofthe Judgment Of The Learned Single Judge, The Declaration Of Law

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE DEVAN RAMACHANDRAN THURSDAY, THE 03RD DAY OF JANUARY 2019 / 13TH POUSHA, 1940WP(C).No. 14220 of 2009 PETITIONER: DR.R.P.PATEL,HAHNEMAN HOUSE,COLLEGE ROAD, KOTTAYAM. BY ADV. SRI.RAMESH CHERIAN JOHN RESPONDENTS: BY ADV. SRI.JOSE JOSEPH THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 03.01.2019ALONG WITH WP(C).18294/2009, THE COURT ON THE SAME DAY DELIVEREDTHE FOLLOWING: WPC 14220 & 18294/09 IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE DEVAN RAMACHANDRAN THURSDAY, THE 03RD DAY OF JANUARY 2019 / 13TH POUSHA, 1940 WP(C).No. 18294 of 2009 PETITIONER: DR.R.P.PATEL,HAHNEMAN HOUSE, COLLEGE ROAD, KOTTAYAM. BY ADV. SRI.RAMESH CHERIAN JOHN RESPONDENTS: BY ADV. SRI.JOSE JOSEPH THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON03.01.2019 ALONG WITH WP(C).14220/2009, THE COURT ON THE SAMEDAY DELIVERED THE FOLLOWING: WPC 14220 & 18294/09 W.P.(C)Nos.14220 & 18294 of 2009 JUDGMENT These two writ petitions are being disposed of jointly sincethey relate to the same assessee, the petitioner herein and becausethe issues are common, though relating to three different assessmentyears. 2. The petitioner says that he had filed his returns, for theassessment years 1991-92, 1992-93 and 1993-94, within time underSection 143(1)(a) of the Income Tax Act ('the Act' for short) and thatthere was subsequently a search at his premises during which certainIndira Vikas Pathras were seized, leading to the re-opening of hisassessments under Section 147 of the Act. He says that theDepartment, thereafter, completed the assessment under Section143(3) read with Section 147 of the Act and that certain additionalamounts were assessed against him, including interest under Sections234B and 234C, for the three assessment years. 3. According to the petitioner, in the year 1998, the 'KarVivadh Samadhan Scheme' was introduced through the Finance Act,1998 and that he had applied for settlement of the liability under the WPC 14220 & 18294/09 said Scheme. The petitioner says that even though he made theapplication as per the mandate of the Scheme and even though hewas fully entitled to all the benefits under it, only a partial relief wasgiven, compelling him to approach this Court by filing O.P.No.7661/1999, consequentially leading to a judgment by a learned SingleJudge of this Court, which is reported in 273 ITR 386. The petitionersays that though his contentions against levy of interest underSections 234B and 234C of the Act have been accepted in thisjudgment, certain other benefits were denied, thus forcing him to fileW.A.No.352/2005, which is stated to be still pending before thisCourt. 4. As per the petitioner, since the judgment of the learnedSingle Judge was stayed in W.A.No.352/2005, it was interpreted bythe Department to assert that even the interest portion found in hisfavour in the said judgment would become recoverable and that stepswere taken by them to do so. The petitioner says that he was,therefore, constrained to file these writ petitions, relying upon thejudgment of this Court in Bahuleyan v. State of Kerala (2007 (4)KLT 402) and that notwithstanding the suspension of the operation ofthe judgment of the learned Single Judge, the declaration of law WPC 14220 & 18294/09 therein still continues to bind the second respondent herein. Thepetitioner adds that, in fact, W.A.No.352/2005 had already been heardby a Division Bench of this Court and is now reserved for judgmentand that if this appeal is allowed, then the demand made against himwould be of no consequence and in the alternative, even if the appealis dismissed, then he would still obtain the benefits as have alreadybeen granted by the learned Single Judge in 273 ITR 386. WPC 14220 & 18294/09 therein still continues to bind the second respondent herein. Thepetitioner adds that, in fact, W.A.No.352/2005 had already been heardby a Division Bench of this Court and is now reserved for judgmentand that if this appeal is allowed, then the demand made against himwould be of no consequence and in the alternative, even if the appealis dismissed, then he would still obtain the benefits as have alreadybeen granted by the learned Single Judge in 273 ITR 386. 5. I have heard Sri.Remesh Cherian John, learned counselappearing for the petitioner and Sri.Jose Joseph, learned StandingCounsel appearing for the respondents. 6. The facts involved in these cases are not very much indispute, that a learned Judge has, in the judgment reported in 273ITR 386, already granted benefit to the petitioner, as far as the levy ofinterest is concerned, is also not disputed. The only point ofcontroversy is that the judgment of the learned Single Judge has beenstayed in W.A.No.352/2005 and the Department, therefore, maintainsthat they are entitled to recover the amounts impugned in these writpetitions. 7. The learned Standing Counsel for the respondentsvehemently contends that since the judgment of the learned Single WPC 14220 & 18294/09 Judge has already been stayed by a Division Bench, the petitionerwould not be entitled to any of the reliefs granted to him through thesaid judgment and therefore, that they are entitled to recover theentire amounts as demanded against him. 8. Even when I hear the learned Standing Counsel for therespondents as afore, the undeniable fact remains that through thejudgment of the learned Single Judge, the petitioner has alreadyobtained benefits as far as the levy of interest is concerned. It is onlyif the judgment is set aside that the petitioner would become liable tomake payment of the said amounts. However, it is also undisputedthat W.A.No.352/2005 has been filed by the petitioner and that thejudgment of the learned Single Judge has not been challenged by theDepartment until now. Therefore, in normal circumstances, it isunlikely that the Division Bench would set aside the judgment of thelearned Single Judge and even if the appeal is to be dismissed, whichis the worst case scenario for the petitioner, the judgment of thelearned Single Judge is likely to be approved. 9. Therefore, I see no reason why the Department should nowattempt to recover the amounts from the petitioner as per theimpugned demand, particularly when I am told that W.A.No.352/2005 WPC 14220 & 18294/09 has been heard by a Division Bench of this Court and reserved forjudgment. It is also a matter of prudence and judicial discipline thatthe respondents await the judgment in the writ appeal because if thesaid appeal is allowed, then the petitioner would be entitled to thebenefits greater than what has been granted to him by the learnedSingle Judge and if, on the contrary, the appeal is dismissed, then thepetitioner would still be entitled to the benefits granted to him by thelearned Single Judge. Consequently, I am of the view that therespondents should await the judgment in W.A.No. 352/2005, which,in my view, would avert further litigation and controversy in future. In the afore circumstances, I order these writ petitions anddirect the respondents to await and act explicitly as per the judgmentof the learned Division Bench in W.A.No.352/2005, so that it will thenobtain clarity as to the nature of the reliefs that would finally becomeentitled to the petitioner. I make it clear that once the judgment in W.A.No.352/2005 isdelivered, the Department will be entitled to, subject to its terms, torecover the amounts from the petitioner, as is permitted therein, afterfollowing the procedural mandate of the Act. In the afore circumstances, I order these writ petitions anddirect the respondents to await and act explicitly as per the judgmentof the learned Division Bench in W.A.No.352/2005, so that it will thenobtain clarity as to the nature of the reliefs that would finally becomeentitled to the petitioner. I make it clear that once the judgment in W.A.No.352/2005 isdelivered, the Department will be entitled to, subject to its terms, torecover the amounts from the petitioner, as is permitted therein, afterfollowing the procedural mandate of the Act. At this time, the learned counsel for the petitioner submitsthat as per the instructions from the petitioner, the entire amountstowards interest have already been recovered from the petitioner andtherefore, it may be clarified that in the event of W.A.No.352/2005being ordered in favour of the petitioner, he would be entitled to seekrefund of the amounts already recovered from him. It is needless tosay that such liberty is available to the petitioner even without theorders of this Court, particularly because all issues are still pendingbefore the learned Division Bench in W.A.No.352/2005. tkv Sd/- Devan Ramachandran, Judge WPC 14220 & 18294/09 APPENDIX OF WP(C) 14220/2009 PETITIONER'S EXHIBITS:EXHIBIT P1EXHIBIT P2EXHIBIT P3 TRUE COPY OF THE ORDER DATED 10.05.07TRUE COPY OF THE ORDER DATED 26.2.99 TRUE COPY OF THE PETITION DATED 01.11.07UNDER SECTION 264 OF THE ACT EXHIBIT P4 TRUE COPY OF THE ARGUMENT NOTE FILED BEFORETHE 2ND RESPONDENT EXHIBIT P5 TRUE COPY OF THE ORDER U/S 264 OF THE ACTDATED 26.03.2009 /TRUE COPY/ P.S. TO JUDGE WPC 14220 & 18294/09 APPENDIX OF WP(C) 18294/2009 PETITIONER'S EXHIBITS: /TRUE COPY/