In Gtn Textiles Ltd v. The Chief Commissioner Of Income Tax

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR.JUSTICE ANTONY DOMINIC THURSDAY, THE 19TH DAY OF JANUARY 2012/29TH POUSHA 1933 WPC.No. 1595 of 2012 (Y) ------------------------ PETITIONER:--------- SHAHINA BABU W/O. LATE K.V. NAUSHAD ALI BABU A/104-BHARATHI-I APARTMENTS, SHERLY RAJAN ROAD NEAR RISWI COLLEGE, BANDRA, WEST MUMBAI-400050 BY ADVS.SRI.D.KISHORE SMT.MINI GOPINATH RESPONDENT(S):-------------- 1. THE CHIEF COMMISSIONER OF INCOME TAX, OFFICE OF THE CHIEF COMMISSIONER OF INCOME TAX, CR BUILDINGS, I.S. PRESS ROAD, COCHIN-682018. 2. THE ADDITIONAL COMMISSIONER OF INCOME TAX, RANGE-I, CR BUILDINGS, I.S.PRESS ROAD COCHIN-682018. COCHIN-682018. 3. THE TAX RECOVERY OFFICER (INCOME TAX) RANGE-I, C.R. BUILDINGS, I.S.PRESS ROAD, COCHIN-682018. RANGE-I, C.R. BUILDINGS, I.S.PRESS ROAD, COCHIN-682018. BY SRI.JOSE JOSEPH, SC, FOR INCOME TAX THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 19-01-2012, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WPC.No. 1595 of 2012 (Y) ------------------------ APPENDIX RESPONDENT'S EXHIBITS: NIL /TRUE COPY/PA TO JUDGE ANTONY DOMINIC, J ....................................................... W.P.(C).1595/2012 .............................................. Dated this the 19[th] day of January, 2012 JUDGMENT Petitioner made an application seeking waiver of interest asprovided under Section 220(2A) of the Income Tax Act (in short'the Act'). That application was considered and by Ext.P8 order,waiver to the extent of 50% of the interest due, has been granted.It is complaining denial of waiver to the extent of as sought for,this writ petition has been filed. 2.Heard the learned counsel appearing for the petitioner whomainly contends that although the petitioner has satisfied thethree conditions laid down in Section 220(2A) of the Act, theCommissioner has acted illegally in denying full benefits. However,having gone through Ext.P8 order and the provisions contained inSection 220(2A), I am unable to find any illegality in Ext.P8. 3.Section 220(2A) of the Act reads thus. -220(2A)Notwithstanding anything containedin sub section (2), the Chief Commissioner orCommissioner may reduce or waive the amount of interest [paid or] payable by an assesseeunder the said sub section if he is satisfied that -(i).payment of such amount has caused orwould cause genuine hardship to the assessee ;(ii).Default in the payment of the amount onwhich interest has been paid or was payableunder the said sub section was due tocircumstances beyond the control of theassessee ; and (iii). The assessee has co-operated in anyinquiry relating to the assessment or anyproceeding for the recovery of any amount duefrom him. 4.In GTN Textiles Ltd. v. Deputy Commissioner ofIncome Tax and Another (217 ITR 653 [Ker] ) andDr.K.Parameswaran Nair v. Assistant Commissioner ofIncome Tax and another (245 ITR 210 (Ker), relied on bythe learned counsel for the Revenue, it has already been held thatall the three conditions contained in Section 220(2A) are to besatisfied by an assessee to claim the benefit of the waiver. In thiscase, the contention of the petitioner for waiver has beenconsidered and the first respondent has held as follows :- “I have carefully considered the applicationfor waiver of interest under Section 220(2). Theassessee's legal heir has cooperated with thedepartment in completion of the assessment andin recovery of the demand. It is also seen thatthe default in payment of tax on which interestunder Section 220(2) was charged was due to “I have carefully considered the applicationfor waiver of interest under Section 220(2). Theassessee's legal heir has cooperated with thedepartment in completion of the assessment andin recovery of the demand. It is also seen thatthe default in payment of tax on which interestunder Section 220(2) was charged was due to liquidity problem as the legal heir did not have aregular source of income to cover all theliabilities including upkeep and maintenance ofthe family. At the same time it is noticed that asper the records, the petitioner's husband, thedeceased assessee, had acquired manyimmovable properties in names of himself, hiswife the petitioner and in their joint names.Further, as per the lease deed executed by thepetitioner on 15.5.08, the office premises inPanampilly Nagar, Ernakulam are let out to JainHousing and Construction Ltd., for a monthly rentof Rs.60,000/- with effect from 15.6.08, liable tobe increased by 5% at the end of every 11[th]month. On a careful consideration of all the factsand circumstances of the case, I am of theopinion that the payment of the entire interestunder Section 220(2) would cause some genuinehardship. However, the applicant does notqualify for full waiver of the interest charged forthe belated payment of the demand. Henceinterest chargeable under Section 220(2) isordered to be reduced by 50%.” 5.A reading of this order shows that the Commissioner hasfound the petitioner eligible for the benefit of Section 220(2A) ofthe Act and having regard to the fact that the petitioner hasvarious assets in her name and also has many income there from,the Commissioner has not satisfied that the petitioner was eligiblefor the full waiver. Such exercise of discretionary power of theCommissioner cannot said to be perverse warranting interferencein a proceedings under Article 226 of the Constitution of India. Therefore, the prayer to interfere with Ext.P8 has to be rejectedand I do so. Although I uphold Ext.P8, petitioner seeks aninstalment facility to discharge the liability. 6.Heard the learned Standing Counsel on this aspect also.Taking note of the submissions, I direct that the amount due fromthe petitioner by way of interest shall be permitted to be paid infive equal monthly instalments, first of which shall be paid on orbefore 15.2.2012 and the remaining instalments will be paid on orbefore 15[th] of every succeeding month. Needless to say that incase default is committed in any one of the instalments, Bankwill be free to take action for recovery of the amount, inaccordance with law. Writ petition is disposed of as above. ANTONY DOMINIC,Judge mrcs /true copy/ P.A. To Judge