Shri T.soundiah v. The Assistant Commissioner Of Income Tax, Corporate Circle 3(1)

IN THE HIGH COURT OF JUDICATURE AT MADRAS CORAM THE HONOURABLE MR.JUSTICE T.S.SIVAGNANAM M/s.Tamil Nadu State Marketing Corporation Ltd.,4th Floor, CMDA Tower-II,Gandhi Irwin Bridge Road,Egmore, Chennai-600 008Represented by its Managing Director(i/c)Dr.C.N.Mahesvaran ... Petitioner in W.P.No.40775 of 2015 M/s.Tamil Nadu State Marketing Corporation Ltd.,4th Floor, CMDA Tower-II,Gandhi Irwin Bridge Road,Egmore, Chennai-600 008Represented by its Managing DirectorShri T.Soundiah Shri T.Soundiah... Petitioner in W.P.Nos.18347 and 33736 of 2013 Vs1.The Assistant Commissioner of Income Tax, Corporate Circle 3(1), 124, MG Road, Chennai-34 2.The Commissioner of Income Tax, Chennai-3 124, MG Road, Chennai-34 3.The Chief Commissioner of Income Tax, Chennai-3, 124, MG Road, Chennai-34 4.The Commissioner of Income Tax, (Appeals)-11, 124, MG Road, Chennai-34... Respondents in W.P.No.40775 of 2015 https://hcservices.ecourts.gov.in/hcservices/ 1. The Chief Commissioner of Income Tax, Chennai-I, 124, MG Road, Chennai-34. Chennai-I, 124, MG Road, Chennai-34. 2.The Commissioner of Income Tax, Chennai-I, 124, MG Road, Chennai-34. Chennai-I, 124, MG Road, Chennai-34. 3.The Commissioner of Income Tax (Appeals), Chennai-III, 124, MG Road, Chennai-34. Chennai-III, 124, MG Road, Chennai-34. 4.The Additional Commissioner of Income Tax, Company Circle III(1), Chennai-34. of Income Tax, Company Circle III(1), Chennai-34. 5.The Assistant Commissioner of Income Tax, Company Circle III(1), Chennai-34 ..... Respondents in W.P.No.18347 of 2014 Income Tax, Company Circle III(1), Chennai-34 ..... Respondents in W.P.No.18347 of 2014 1.The Chief Commissioner of Income Tax, Chennai-III, 121, M.G.Road, Chennai-34. Chennai-III, 121, M.G.Road, Chennai-34. 2.The Commissioner of Income Tax, Chennai-III, 121, M.G.Road, Chennai-34 Chennai-III, 121, M.G.Road, Chennai-34 3.The Commissioner of Income Tax(Appeals)-III, 121, M.G.Road, Chennai-34. 121, M.G.Road, Chennai-34. 4.The Joint Commissioner of Income Tax, Company Range III(1), 121, M.G.Road, Chennai-345.The Assistant Commissioner of Income Tax, Company Circle III(1), 121, M.G.Road, Chennai-34..... Respondents in Company Range III(1), 121, M.G.Road, Chennai-345.The Assistant Commissioner of Income Tax, Company Circle III(1), 121, M.G.Road, Chennai-34..... Respondents in W.P.No.33736 of 2013 Prayer in W.P.No.40775 of 2015: Petition filed under Article226 of the Constitution of India praying for issuance of a writof certiorarified mandamus to call for the records of the https://hcservices.ecourts.gov.in/hcservices/ petitioner on the file of the 1st respondent and quash theimpugned order in C.No.ACIT/COR CIR 3(1)/AAACT2964P/2015-16dated 15.12.2015 and consequently direct the first respondent togrant stay of collection of tax and interest for the assessmentyear 2012-13 till the disposal of appeal by the 4th respondent. Prayer in W.P.No.18347 of 2014: Petition filed under Article226 of the Constitution of India praying for issuance of a writof certiorarified mandamus to call for the records of thepetitioner on the file of the 5th respondent and quash theimpugned order in PAN/GIR: /2014-15 dated 30.06.2014and consequently direct the fifth respondent to grant stay ofcollection of tax and interest for the assessment year 2011-12till the disposal of appeal by the 3rd respondent. Prayer in W.P.No.18347 of 2014: Petition filed under Article226 of the Constitution of India praying for issuance of a writof certiorarified mandamus to call for the records of thepetitioner on the file of the 5th respondent and quash theimpugned order in PAN/GIR: /2014-15 dated 30.06.2014and consequently direct the fifth respondent to grant stay ofcollection of tax and interest for the assessment year 2011-12till the disposal of appeal by the 3rd respondent. Prayer in W.P.No.33736 of 2013: Petition filed under Article226 of the Constitution of India praying for issuance of a writof certiorarified mandamus to call for the records of thepetitioner on the file of the 5th respondent inPAN/GIR:AAACT2964P/2013-14 and quash the impugned order underSection 220(3) dated 06.12.2013 and direct the 5th respondent togrant stay of collection of tax and interest for the assessmentyear 2010-11 till the disposal of appeal by the 3rd respondent. For Petitioner: Mr.P.H.Arvindh Pandian Additional Advocate General for Mr.Subbaraya Aiyar in all W.Ps. For Respondents : Mrs.Pushpa for Mr.M.Swaminathan in all W.Ps. COMMON ORDER Heard Mr.Mr.P.H.Arvindh Pandian, learned AdditionalAdvocate General for M/s.Subbaraya Aiyar, Padmanaban andRamamani, counsel for the petitioner and M/s.Pushpa, learnedStanding Counsel, who accepts notice for the respondents andwith the consent of parties, the writ petitions are taken upfor final disposal. 2. In all these writ petitions, the challenge is to theorders passed by the Assistant Commissioner of Income Tax underSection 220(3) of the Income Tax Act, 1961 (hereinafter referredto as 'the Act' in short). By the said orders, a condition hasbeen imposed by the authority for grant of stay. 3. The first writ petition was filed in the year 2013and an interim order has been granted by this Court on11.12.2013, which reads as follows: https://hcservices.ecourts.gov.in/hcservices/ "Mr.T.Pramod Kumar Chopda, learned counselfor Income Tax takes notice for the respondentsand requests two weeks' time to file counter. 2. Mr.P.H.Arvind Pandian, learned AdditionalAdvocate General would contend the 5th respondentfailed to appreciate that in the present case, theallowance of special privilege fee was subjectmatter of appeal before the Tribunal and theTribunal has upheld the claim of the petitioner.Hence, there is no power vested with the 5threspondent to exercise jurisdiction in respect ofthe special privilege fee, which has beenconsidered and decided in appeal by the Tribunalunder Explanation (c) to Section 263(1) of theAct. He also submits that the action of therespondents his ultravires the provisions of theAct and thus, there is a scope of interference bythis Court to quash the show cause notice. 3.Considering the same, there shall be anorder of interim stay till 03.01.2014.Post the matter on 03.01.2014 for counter anddisposal." The interim order has been subsequently extended from time totime and it is in force as on date. As and when subsequentorders were passed by the Assistant Commissioner of Income Tax,the petitioner has filed the other writ petitions and in theother writ petitions also interim orders have been granted bythis Court, following the earlier orders. 4. On the last hearing date, i.e. on 3.6.2016, it wasrepresented by the learned Additional Advocate General that theCommissioner of Income Tax (Appeals) has already taken up theappeals and the hearing is about to conclude. Therefore, thisCourt directed the writ petitioner to file an affidavit, bypassing the following order: "Heard Mr.P.H.Arvind Pandian, learnedAdditional Advocate General for the petitionerand Ms.Pushpa, learned Standing Counsel for therespondents. 4. On the last hearing date, i.e. on 3.6.2016, it wasrepresented by the learned Additional Advocate General that theCommissioner of Income Tax (Appeals) has already taken up theappeals and the hearing is about to conclude. Therefore, thisCourt directed the writ petitioner to file an affidavit, bypassing the following order: "Heard Mr.P.H.Arvind Pandian, learnedAdditional Advocate General for the petitionerand Ms.Pushpa, learned Standing Counsel for therespondents. 2.In all the writ petitions, at the timewhen they were entertained, an order of interimstay was granted, by virtue of which, no coerciveaction could be taken against the petitioner forrecovery of tax. This Court was prima faciesatisfied and granted interim order on the ground https://hcservices.ecourts.gov.in/hcservices/ that as against the orders of assessment, thepetitioner filed appeals before the Commissionerof Income Tax (Appeals) and the appeals have beentaken up for hearing on 31.12.2015. 3. Th learned Additional Advocate Generalsubmits that the appeals have been heard and theyare in the final stage. 4.Prima facie, this Court is of the viewthat it will be inequitable to disturb theinterim order, which has been continuing since2013. However, to make things clear, there willbe a direction to the petitioner to file anaffidavit setting out as to what is the stage ofthe appeals and other connected matters. 5. Post on 16.6.2016." 5. Pursuant thereto, an affidavit has been filed by thewrit petitioner stating that for the assessment year 2010-11,the appeal in I.T.A.No.670/13-14 was posted for hearing on9.7.2014 and subsequently, adjourned to 13.8.2014, 21.08.2014,10.09.2014 and 9.10.2014. The appeals for the assessment years2011-12, 12-13 in I.T.A.Nos.122/2014-15, 145/15-16 and 233/15-16were also taken up for hearing along with the appeal for theassessment year 2010-11 and all the appeals were posted forhearing on 31.12.2015 and subsequently adjourned to 02.02.2016,02.03.2016, 18.4.2016 and 19.5.2016. It is further submittedthat written statements, requisite documents and decisions havebeen placed and the petitioner has also clarified the issues,which have been raised by the Commissioner of appeals. Further,the learned Additional Advocate General has produced a copy ofthe letter dated 14.6.2016, sent by the Commissioner of IncomeTax Appeals to the Principal Commissioner of Income Tax Appeals,with a copy marked to the petitioner and their counsel,forwarding the petitioner's written statements and also callingfor the assessing officers remand report to be filed on orbefore 15.3.2016. 6. From the averments made in the affidavit filed bythe petitioner as well as the proceedings of the Commissioner ofIncome Tax Appeals, dated 14.6.2016, it is evident that thehearing of the appeals have been concluded and all that is to bedone is to pass an order. 7.ThelearnedStandingcounselfortherespondents/Department, on instructions, submitted that orderswill be passed within a period of eight weeks. https://hcservices.ecourts.gov.in/hcservices/ 8. Therefore, this Court is of the view that it wouldbe inequitable to vacate the interim orders, which have been inforce for almost 2 1/2 years in the first writ petition and forabout 1 1/2 years in the other writ petitions, at this stage ofthe matter, especially, when the appeals filed by the petitionerhave been finally heard and orders are to be passed shortly. 7.ThelearnedStandingcounselfortherespondents/Department, on instructions, submitted that orderswill be passed within a period of eight weeks. https://hcservices.ecourts.gov.in/hcservices/ 8. Therefore, this Court is of the view that it wouldbe inequitable to vacate the interim orders, which have been inforce for almost 2 1/2 years in the first writ petition and forabout 1 1/2 years in the other writ petitions, at this stage ofthe matter, especially, when the appeals filed by the petitionerhave been finally heard and orders are to be passed shortly. 9. In the light of the fact that the appeal petitionsfiled against the orders of assessment have been heard andorders are to be passed by the Commissioner of Income TaxAppeals, which according to the respondents, will be passedwithin a period of eight weeks, no action for recovery or noother coercive action shall be taken against the petitioner,pursuant to the impugned orders. Further action by therespondent department shall abide by the orders to be passed bythe Commissioner of Appeals, in the appeals which have beenfiled by the petitioner. 10. The writ petitions are disposed of accordingly. Nocosts. Connected miscellaneous petitions are closed. Sd/- Assistant Registrar(CCC) //True Copy// To Sub Assistant Registrar 1.The Assistant Commissioner of Income Tax, Corporate Circle 3(1), 124, MG Road, Chennai-34 2.The Commissioner of Income Tax, Chennai-3 124, MG Road, Chennai-343.The Chief Commissioner of Income Tax, Chennai-3, 124, MG Road, Chennai-34 4.The Commissioner of Income Tax, (Appeals)-11, 124, MG Road, Chennai-34 5. The Chief Commissioner of Income Tax, Chennai-I, 124, MG Road, Chennai-34. Chennai-I, 124, MG Road, Chennai-34. 6.The Commissioner of Income Tax, Chennai-I, 124, MG Road, Chennai-34. Chennai-I, 124, MG Road, Chennai-34. 7.The Commissioner of Income Tax (Appeals), Chennai-III, 124, MG Road, Chennai-34. Chennai-III, 124, MG Road, Chennai-34. 8.The Additional Commissioner of Income Tax, Company Circle III(1), Chennai-34. of Income Tax, Company Circle III(1), Chennai-34. 9.The Assistant Commissioner of Income Tax, Company Circle III(1), Chennai-34 Income Tax, Company Circle III(1), Chennai-34 10.The Joint Commissioner of Income Tax, Company Range III(1), 121, M.G.Road, Chennai-34 Company Range III(1), 121, M.G.Road, Chennai-34 11.The Assistant Commissioner of Income Tax, Company Circle III(1), 121, M.G.Road, Chennai-34. Company Circle III(1), 121, M.G.Road, Chennai-34. +1cc to Mr.Swaminadhan, Advocate SR.33118 W.P.Nos.40775 of 2015, 18347 of2014 and 33736 of 2013 sv[co]srg 24/06/2016