Wp/26936/2007 Of The Agricultural Market Committee, Thungathruty v. The Commissioner Of Income Tax (Appeals) Vi, Aayakar Bhavan

HONOURABLE MRS. JUSTICE T.MEENA KUMARI&HONOURABLE MR JUSTICE C.V. NAGARJUNA REDDY WRIT PETITION No:26936 OF 2007Dated:20.12.2007 Between: The Agricultural Market Committee, Thungathruty Nalgonda District rep., by its Secretary. ..Petitioner And 1. The Commissioner of Income Tax (Appeals) VI Aayakar Bhavar, III Floor, Basheerbagh, Hyderabad and others. ..Respondents. HONOURABLE MRS. JUSTICE T.MEENA KUMARI&HONOURABLE MR JUSTICE C.V. NAGARJUNA REDDY WRIT PETITION No:26936 OF 2007 ORDER: (Per Hon’ble Smt. Justice T. Meena Kumari) The present writ petition is filed by the petitioner seeking todeclare the notice dated 19.11.2007 issued under Section 226 (3)of the Income Tax Act by the 2[nd] respondent as illegal andarbitrary and to set aside the same. The main grievance of the petitioner is that the appealpreferred before the 1[st] respondent challenging the assessmentorder of the 2[nd] respondent was dismissed and further appeal hasbeen preferred before the Income Tax Appellate Tribunal. Whileso, the 2[nd] respondent issued garnishee notice to the 3[rd]respondent for recovery of the tax in question. Aggrieved by thesame, the present writ petition is filed by the petitioner. Heard the learned Counsel appearing for the petitioner andthe learned Special Standing Counsel for Commercial Tax andperused the material available on record. It is the contention of the learned Counsel for the petitionerthat an appeal is pending before the Income Tax AppellateTribunal, and at this stage, the issuance of the garnishee notice iscontrary to law and at this juncture, if the stay is not granted andin case the recovery of the disputed tax in question is effectedduring the pendency of the appeal before the Appellate Tribunal, the very purpose of filing the said appeal, which is a statutoryremedy that is available to the aggrieved party, would be defeatedand therefore, the impugned garnishee notice is liable to be setaside. On the other hand, Sri J.V. Prasad opposed the petition onthe ground that since the appeal is pending before the appellateauthority, it is for it to grant stay. In the facts and circumstances of the case and in view ofthe pendency of the appeal, without expressing any opinion on themerits of the case, We feel it a fit case wherein the garnisheenotice in question can be suspended, but subject to imposition ofcertain conditions. At this stage, it is the contention of the learned Counsel forthe petitioner that if the garnishee notice is not suspended, it ismuch difficult to operate the account to meet the regulartransactions and also to comply with the order of this Court. In view of the above submission, We deem it appropriate tosuspend the garnishee notice so as to enable the petitioner tocontinue the operation of the account and comply with theconditions that would be imposed while granting stay by this Court,till the disposal of the statutory appeal filed by the petitioner. Accordingly, there shall be suspension of the garnisheenotice till the disposal of the appeal pending before the Income TaxAppellate Tribunal, subject to the condition of the petitionerdepositing Rs.5,00,000/- (Rupees Five Lakhs only), within a periodof four (4) weeks from today. On such deposit, the appeal shall be disposed of within three months thereafter. It is needless toobserve that in case of non-compliance of the above order, thegarnishee notice shall become operative. Subject to the above direction, the writ petition is disposedof. No order as to costs. _______________________ Justice T. Meena Kumari _____________________________ Justice C.V. Nagarjuna Reddy Date: 20[th] December, 2007 Nn/Gurc. HONOURABLE MRS. JUSTICE T.MEENA KUMARI&HONOURABLE MR JUSTICE C.V. NAGARJUNA REDDY WRIT PETITION No:26936 OF 2007(Order delivered by the Hon’ble Smt. Justice T. Meena Kumari) Dated:20.12.2007