Wa/744/2013 Of A.m.moosa v. The Commissioner Of Income Tax

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HON'BLE THE CHIEF JUSTICE DR. MANJULA CHELLUR & THE HONOURABLE MR.JUSTICE A.M.SHAFFIQUE TUESDAY, THE 1ST DAY OF OCTOBER 2013/9TH ASWINA, 1935 WA.No. 744 of 2013 IN WP(C).21824/2012 ------------------------------------------- AGAINST THE JUDGMENT IN WP(C) 21824/2012 DATED 27-09-2012............... APPELLANT/PETITIONER :------------------------------ A.M.MOOSA BHARAT SEA FOODS, CHANDIROOR, ALAPPUZHA - 688 547. BY ADV. SRI.S.ARUN RAJ RESPONDENTS/RESPONDENTS : ------------------------------------ 1. THE COMMISSIONER OF INCOME TAX PUBLIC LIBRARY BUILDING, KOTTAYAM - 686 001. 2. DY. COMMISSIONER OF INCOME TAX CIRECLE-I, ALAPPUZHA - 688 001. 3. THE TAX RECOVERY OFFICER, PUBLIC LIBRARY BUILDINGS, KOTTAYAM - 686 001. BY SRI.JOSE JOSEPH, SC, FOR INCOME TAX THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 01-10-2013, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: Manjula Chellur, C.J. & A.M. Shaffique, J. - - - - - - - - - - - - - - - - - - - - - - - - - - - - W.A. No. 744 OF 2013 - - - - - - - - - - - - - - - - - - - - - - - - - - - - Dated this the 1[st] day of October, 2013 “C.R.” Manjula Chellur, C.J. JUDGMENT Heard learned counsel for the appellant. We have gone through the order of the assessing officer (Ext.P7) on theapplication filed by the appellant assessee under Section 220(2) of Income Tax Act at Ext.P6, as well as the judgment ofthe learned Single Judge. 2. It is not in dispute that so far as the return ofincome filed by the assessee for the year 1992-93 which wastaken up for scrutiny came to be completed only on19.01.1995 under Section 143(3) of the Act. The total incomeincluding the agricultural income was more than the incomeshown in the returns, therefore, the claim of deductions underSection 80HHC of the Act amounting to `11,29,813/- wasdisallowed. As against this, the appellant assessee approachedall the forums available under the Act. Ultimately, the questionthat came up for consideration was, whether the assessee was WA No. 744 of 2013 -:2:- able to satisfy all the three conditions to claim the benefit asindicated under Section 220(2A) of the Act is the controversybefore us. Admittedly the appellant is relying upon the firstcondition and not the two other conditions. Section 220(2A)(i)of the Income Tax Act reads as under: “220. When tax payable and when assesseedeemed in default.- xxxxxx xx (2A) Notwithstanding anything contained in sub-section (2), the Chief Commissioner or Commissioner mayreduce or waive the amount of interest paid or payable byan assessee under the said sub-section if he is satisfiedthat- (i) payment of such amount has caused or wouldcause genuine hardship to the assessee;” 3. The learned Judge after referring to the report of the assessing officer, ultimately opined that all the threeconditions enumerated under Section 220(2A) have to becomplied with in order to get the benefit. The claim of genuinehardship was not established in the light of returns filed by theappellant assessee for the assessment year 2006-07 and WA No. 744 of 2013 therefore he was not entitled for any benefit. This view of theappellate authority and the Commissioner of Income Tax atExt.P7 came to be affirmed by the learned Single Judge.Aggrieved by the same, the present appeal is filed. (i) payment of such amount has caused or wouldcause genuine hardship to the assessee;” 3. The learned Judge after referring to the report of the assessing officer, ultimately opined that all the threeconditions enumerated under Section 220(2A) have to becomplied with in order to get the benefit. The claim of genuinehardship was not established in the light of returns filed by theappellant assessee for the assessment year 2006-07 and WA No. 744 of 2013 therefore he was not entitled for any benefit. This view of theappellate authority and the Commissioner of Income Tax atExt.P7 came to be affirmed by the learned Single Judge.Aggrieved by the same, the present appeal is filed. 4. According to learned counsel for the appellant, thecause of genuine hardship under sub-clause(i) of Section 220(2A) does not mean only financial hardship and other relevantfactors have to be taken into consideration. We fail tounderstand what are the other contentions other than thegenuine financial hardship, so far as the present case isconcerned. It is not the case of the Department that applicationunder Section 220(2A) of the Act was not filed according to theprocedure. It is not even the case of any of the parties that thereare other legal lacuna or impediment so far as considering suchapplication which is filed by the appellant. It is not even the caseof the appellant assessee that he was not able to plead suchclaim within the time prescribed. In the absence of thosecircumstances the only genuine cause could be the financialhardship, therefore, the Commissioner for Income Tax after WA No. 744 of 2013 referring to the details in the returns filed by the assesseeproceeded to hold that in the absence of genuine hardship beingsatisfied by the appellant, he is not entitled for any of the benefitunder Section 220(2A) of the Act. It is clear from the returns ofincome for the assessment year 2006-07, as per the balancesheet furnished by the assessee as on 31.03.2006, the assesseehad cash balance of `23,04,809/-, debtors of `30,07,500/- asagainst creditors `3,16,469/- and the asset worth `52,97,037/-.Apart from this, export incentives receivable is `14,30,904/-. Inthe light of the above details of his returns for the assessmentyear 2006-07, whether one can consider the genuine hardshipclaimed by the assessee as a reasonable one is the only question. 5. After referring to the details of the returns ofincome filed by the appellant, the authorities who had the benefitof verifying records have already concluded factually what exactlywas the state of affairs so far as the clear cash balance availableand also other income to be received by the appellant/assessee.Therefore, they were justified in saying that there was no WA No. 744 of 2013 -:5:- genuine hardship as claimed, therefore one of the requirementsof Section 220(2A) was not satisfied, hence it was properly heldthat he was not entitled for any benefit under Section 220(2A) ofthe Income Tax Act. Accordingly, affirming the opinion of the authoritiesand the learned Single Judge, we dismiss the appeal. Manjula Chellur, Chief Justice. A.M. Shaffique, Judge. ttb/01/10