Cwjc/4218/2019 Of Chanakya National Law University v. The Commissioner Of Income Tax (Exemption), Patna

IN THE HIGH COURT OF JUDICATURE AT PATNACivil Writ Jurisdiction Case No.4218 of 2019 ====================================================== Chanakya National Law University Nyaya Nagar, Mithapur, Patna (Bihar)through its Registrar Sri Manoranjan Prasad Srivastava, male, aged about 67years, son of Late Narendra Nath, resident of Flat No. 204 D, Lekhraj Parisar,Road no. 03, Near Gandhi Murti, East Patel Nagar, Patna, P.O.- Shastri Nagar,P.S.-Shastri Nagar, District-Patna. ... ... Petitioner/s Versus 1.The Commissioner of Income Tax (Exemption), Patna. 2.The Assistant Commissioner of Income Tax, Exemptions Circle, Patna.3.The Commissioner of Income Tax (Appeals)-1, Patna. ... ... Respondent/s ======================================================Appearance :For the Petitioner/s:Mr. Ajay Kumar Rastogi, Adv. Mr. Parijat Saurav, Adv. Ms. Smriti Singh, Adv.For the Respondent/s:Ms. Archana Sinha @ Archana Shahi, Sr. SC. Mr. Sanjeev Kumar, Adv. Mr. Alok Kumar, Adv. ====================================================== CORAM: HONOURABLE MR. JUSTICE JYOTI SARAN and HONOURABLE MR. JUSTICE ARVIND SRIVASTAVAORAL JUDGMENT(Per: HONOURABLE MR. JUSTICE JYOTI SARAN)Date : 29-03-2019 Heard Mr. Ajay Kumar Rastogi, learned counselappearing for the petitioner and Ms. Archana Sinha, learned SeniorStanding Counsel appearing for the Department. It is for a limited purpose that this writ petition is filedfeeling aggrieved by the order dated 29.01.2019 of the AssistantCommissioner, Income Tax, Exemptions Circle, Patna impugnedat Annexure 4 and the order dated 26.02.2019 impugned atAnnexure-8/A and that is because the petitioner has been directedto make a pre-deposit of 20% of the disputed tax before he can beprovided with an interim protection. Although Mr. Rastogi, learned counsel appearing for thepetitioner has referred to some advisory issued by the Departmentin the matter as present in the Board’s Instructions no. 1914 dated02.12.2013 as improved through subsequent advisories on theissue of pre-condition of deposit for the purpose of interim stay butit is undisputed that the Income Tax Act, 1961 (hereinafter referredto as the ‘Act’) does not invite any pre-deposit for invoking theappellate jurisdiction. It is thus completely at the discretion of theAppellate Authority or the competent authority concerned, todirect for any deposit in case the assessee seeks interim protectionpending disposal of the appeal preferred against the assessmentorder. In so far as the case in hand is concerned, the petitioner isan educational institution registered under section 12AA of the‘Act’ and entitled to the benefits of exemption as provided undersections 11 and 12 thereof. Now while it is the stand of the petitioner that he is notexigible to the tax so assessed, the position is contested by learnedcounsel appearing for the Department and since the matter ispending consideration before the Appellate Authority, we refrainfrom expressing any opinion but while doing so we are persuadedto bear in mind the registration of the petitioner under section12AA of the ‘Act’ which does entitle the petitioner to certain exemption. Now what is the extent of such exemption, is a subjectmatter of adjudication in the pending appeal. In so far as the issue of pre-deposit is concerned, theguidelines issued by the Department from time to time doprescribe an amount of about 20% or so for obtaining an order ofstay on recovery process but which limit can be reduced at thediscretion of the Assessing Authority. In so far as the present caseis concerned, no such discretion has been exercised and by theorder impugned the petitioner has been directed to deposit of 20%of the disputed amount, for availing the interim protection. exemption. Now what is the extent of such exemption, is a subjectmatter of adjudication in the pending appeal. In so far as the issue of pre-deposit is concerned, theguidelines issued by the Department from time to time doprescribe an amount of about 20% or so for obtaining an order ofstay on recovery process but which limit can be reduced at thediscretion of the Assessing Authority. In so far as the present caseis concerned, no such discretion has been exercised and by theorder impugned the petitioner has been directed to deposit of 20%of the disputed amount, for availing the interim protection. It is not in dispute that while initially a sum ofRs.5,00,000/- was deposited by the petitioner towards the disputedtax amount but during the pendency of the matter another sum ofRs.15,00,000/- has been deposited. Thus when this matter came upfor consideration on 26.03.2019, a sum of Rs.20,00,000/- hadalready been deposited by the petitioner. Allowing the petitioner tomove ahead, it is informed by Mr. Rastogi and not contested byMs. Archana Sinha, learned counsel representing the Departmentthat a further sum of Rs.20,00,000/- has been deposited by thepetitioner-University. Having considered the submissions of learned counselappearing for the contesting parties and considering that there isadmittedly a discretion vested in the statutory authority to go below the limit of 20% so fixed in the advisories issued, that theinstitution is registered under section 12AA of the ‘Act’, we aresatisfied by the conduct of the petitioner to grant interimprotection until the disposal of the appeal bearing note of thedeposit of about Rs.40,00,000/- by the petitioner towards thedisputed amount. Let no coercive measures be taken by the Departmenttowards the recovery of the balance amount until disposal of theappeal pending before the Commissioner of Income Tax(Appeals), Patna who is accordingly advised to consider anddispose of the appeal expeditiously and preferably within 8 weeksfrom the date of receipt/production of a copy of this judgment. Itgoes without saying that parties would cooperate in theexpeditious disposal of the appeal. The writ petition is allowed with the direction above. (Jyoti Saran, J) (Arvind Srivastava, J) Anjula/skpathak AFR/NAFRNAFRCAV DATENAUploading Date12.04.2019Transmission DateNA