Wa/726/2007 Of Dr. G.pushpangathan v. Income Tax Officer

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR.JUSTICE C.N.RAMACHANDRAN NAIR &THE HONOURABLE MR.JUSTICE C.K.ABDUL REHIM FRIDAY, THE 8TH DAY OF JUNE 2012/18TH JYAISHTA 1934 WA.No. 726 of 2007 ( ) IN WPC/34173/2006 -----------------------------------------AGAINST THE ORDER/JUDGMENT IN WPC.34173/2006 DATED 20-02-2007 APPELLANT(S)/PETITIONERS IN THE WPC:----------------------------------- 1. DR. G.PUSHPANGATHAN, LECTURER, SELECTION GRADE, S.N.COLLEGE KOLLAM, RESIDING AT 'SAKTHYEM', CHERIKSHETRA NAGAR KILIKOLLUR.2. SMT.V.SUNANTHAKUMARI, LECTURER, SELECTION GRADE, DEPARTMENT OF PHILOSOPHY, S.N.COLLEGE, KOLLAM RESIDING AT 'ASWATHI', VIDHYA NAGAR, HOUSE NO.18, PATHATHANAM, KOLLAM.3. K.SHAJI, LECTURER, SELECTION GRADE, S.G.COLLEGE KOTTARAKKARA, RESIDING AT 'KUZHIYATHU VEEDU' KARAVALLOOR P.O., PUNALUR P.O., KOLLAM.4. DR. N.JAYADEVAN, LECTURER, SELECTION GRADE, S.N.COLLEGE KOLLAM, RESIDING AT 'HARSHM', PATHATHANAM KOLLAM.5. B.SURESH KUMAR, LECTURER, SELECTION GRADE, S.N.COLLEGE KOLLAM, RESIDING AT 'THARAYIVEEDU', ASRAHAMAM P.O. KOLLAM.6. DR. MARY TRESA P. MIRANDA, LECTURER, SELECTION GRADE, FMN COLLEGE KOLLAM, RESIDING AT 'GALAPAGOS', AMMAN NAGAR PATTATHANAM, KOLLAM.7. N.UNNIKRISHNAN, LECTURER, SELECTION GRADE, S.N.COLLEGE CHERTHALA, RESIDING AT 'CHEMPAKASSERI' JAWAHAR NAGAR, PATTATHANAM P.O. BY ADV. SRI.S.MUHAMMED HANEEFF sou. RESPONDENT(S)/RESPONDENTS IN WPC: --------------------------------- 1. INCOME TAX OFFICER, WARD NO.2, OFFICE OF THE ADDL. COMMISSIONER OF INCOME TAX, KOLLAM RANGE. OF INCOME TAX, KOLLAM RANGE. 2. COMMISSIONER OF INCOME TAX (APPEALS), AYAKAR BHAVAN, KAVADIAR, THIRUVANANTHAPURAM. BY ADV. SRI.P.K.R.MENON,SR.COUNSEL,GOI(TAXES) BY ADV. SRI.JOSE JOSEPH, SC FOR IT THIS WRIT APPEAL HAVING BEEN FINALLY HEARD ON 08-06-2012, ALONG WITH WPC.33616/2006, WPC.6881/2008, WPC.8926/2008, WPC.9347/2008, WPC.13820/2008, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: C.N. RAMACHANDRAN NAIR & C.K. ABDUL REHIM, JJ --------------------------------------------------------------------------- W.A. No.726 of 2007, W.P(C).No.33616 of 2006, W.P(C).No.6881of 2008, W.P(C).No.8926 of 2008, W.P(C).No.9347 of 2008, W.P(C).No.13820 of 2008, ------------------------------------------------------------------------------Dated 8[th] June, 2012 J U D G M E N T Ramachandran Nair, J The question raised in the writ appeal and in the connectedWP(c)s is one and the same. We, therefore heard all the casestogether and proceed to dispose of the same by commonjudgment. 2. We have heard counsel for respondent/petitioners andalso Standing Counsel for Income Tax Department. The disputearose when the assessees in these cases got arrears of salaryduring the previous assessment year 2004-2005. Full amountwas not paid in cash to the assessees but substantial portion ofthe arrears were credited in the PF account on which theassessees had no choice. In the returns filed, assssees claimedsec.89 (1) -benefit that spreading over of arrears to back years.However, in that process assessees claimed deduction of the W.A. No.726/07 & connections entire amount deposited in PF account as deduction. Theassessing Officer treated the claim as inadmissible and issuedproceedings under section 143(1)(a) of the Act disallowing theclaim. This was challenged in appeal. The CIT (appeals) heldthat deduction cannot be made by way of prima facie adjustmentunder section 143(1)(a) of the Act. Further he proceeded toconsider the claim on merit and held in favour of the assessees.The Department did not challenge the orders of the CIT (appeals),which means that those orders have become final. However,when High Court decided another case, holding disentitlement ofthe employees, the assessments were reopened under section147 of the Act, which was challenged in writ petitions. W.A. No.726/07 & connections entire amount deposited in PF account as deduction. Theassessing Officer treated the claim as inadmissible and issuedproceedings under section 143(1)(a) of the Act disallowing theclaim. This was challenged in appeal. The CIT (appeals) heldthat deduction cannot be made by way of prima facie adjustmentunder section 143(1)(a) of the Act. Further he proceeded toconsider the claim on merit and held in favour of the assessees.The Department did not challenge the orders of the CIT (appeals),which means that those orders have become final. However,when High Court decided another case, holding disentitlement ofthe employees, the assessments were reopened under section147 of the Act, which was challenged in writ petitions. 3. After hearing both sides, we find that writ appeal and theWP(c)s have to be allowed because there is no provision undersection 147 of the IT Act to reopen the orders of CIT (appeals) onissues decided against the Department. In this case, thereopening proposed is to bring to tax same income in respect ofwhich Commissioner decided the issue in appeal filed byassessees. So much so Revenue could have only file an appealwith a delay condonation petition if there was delay. However, no W.A. No.726/07 & connections proceedings under section 147 is maintainable against orders ofthe CIT (Appeals). Hence we allow the writ appeal by vacatingthe judgment of the single Judge and allow all the W.P(c)s byvacating the impugned orders and by restoring the orders of CIT(appeals) which have become final. Sd.- C.N. RAMACHANDRAN NAIR, JUDGE Sou. Sd/-C.K. ABDUL REHIM, JUDGE. // True copy // P.A. to Judge.