Wp(C) v. Wp(C)

IN THE HIGH COURT OF KERALA AT ERNAKULAMPRESENT THE HONOURABLE MR. JUSTICE DINESH KUMAR SINGHTUESDAY, THE 19 DAY OF SEPTEMBER 2023 / 28TH BHADRA, 1945WP(C) NO. 28750 OF 2023 PETITIONER: M/S SHEIKH SONSTRIDENT ARCADE, PINANGODE ROAD, KALPETTA VIA, WAYANAD,PIN – 673 121 REPRESENTED BY ITS MANAGING PARTNER C.K. USMAN BY ADV S.ARUN RAJ RESPONDENTS: 1INCOME TAX OFFICER, WARD-1, MAYOSSULTHAN BATHERY, KAINATTY, KALPETTA, WAYANAD,PIN – 673 122.SULTHAN BATHERY, KAINATTY, KALPETTA, WAYANAD,PIN – 673 122. 2ADDITIONAL/JOINT/DEPUTY/ASSISTANT COMMISSIONER OF INCOME TAX/INCOME TAX OFFICER, NATIONAL FACELESS ASSESSMENT CENTREINCOME TAX/INCOME TAX OFFICER, NATIONAL FACELESS ASSESSMENT CENTRE INCOME TAX DEPARTMENT, 2ND FLOOR, E- RAMP, JAWAHARLAL NEHRU STADIUM, NEW DELHI, PIN – 110 003. 3COMMISSIONER OF INCOME TAX (APPEALS)NATIONAL FACELESS APPEAL CENTRE INCOME TAX DEPARTMENT, 2ND FLOOR, E- RAMP, JAWAHARLAL NEHRU STADIUM, NEW DELHI, PIN – 110 003. 4THE PRINCIPAL COMMISSIONER OF INCOME TAXAAYAKAR BHAVAN, NORTH BLOCK, MANANCHIRA, KOZHIKODE, PIN – 673 001. OTHER PRESENT: CHRISTOPHER ABRAHAM-SC-IT THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON19.09.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: DINESH KUMAR SINGH, J. -------------------------------------------- WP(C) NO. 28750 OF 2023 -------------------------------------------- Dated this the 19[th] day of September, 2023 J U D G M E N T 1. The present Writ Petition has been filed under Article 226 of the Constitution of India,seeking the following prayers. “i)To issue a writ of mandamusdirecting the 2[nd] respondent:- CIT (Appeals),National Faceless Assessment Centre, Delhito consider and pass order on Exhibit P-2and P-4 Appeals and/or Exhibit P-5 and P-6stay petitions for the AY 2017-18, asexpeditiously as possible, at any rate withina time limit as may be fixed by thisHonourable Court: ii)To issue a writ of mandamusdirecting the respondents/income taxdepartment not to take any furtherproceedings based on Exhibit P-1assessment order and P-3 penalty order for the AY 2017-18 pending final disposal ofExhibit P-2 and P-4 statutory firstappeals/Exhibit P-5 and P-6 stay petitionsby the 3[rd] respondent; And iii) To issue such other appropriatewrit, order or directions as this Hon’bleCourt may deem just and proper to issue inthe facts and circumstances of the case.” To issue such other appropriate 2. The petitioner is a partnership firm constituted for the purchase and sale of land,building etc. The petitioner did not file return of itsincome for the assessment year 2017-2018. Thepetitioner was issued with a notice under Section142(1) of the Income Tax Act, 1961 (‘Act, 1961’ forshort) for assessment year 2017-2018. Thereafter,Exhibit P1 assessment order dated 22.03.2022 wasissued under Section 147 read with Sections 144and 144B of the Act, 1961 making huge additionsandthetotalincomeasdetermining WP(C) NO. 28750 OF 2023 4 Rs.4,28,41,120/-. The penalty proceedings were also initiated against the petitioner and thepetitioner was imposed with a penalty at the rate of200% of the assessed tax under section 270A of theAct, 1961 i.e., Rs.1,97,68,606/-, as is evident fromExt.P3 impugned order dated 27.09.2022. 3.Challenging Exhibit P1 assessment order, the petitioner had filed Exhibit P2 appeal with adelay of 277 days. Against Exhibit P3 penaltyorder, Exhibit P4 appeal is filed on 25.01.2023.The appeals were filed with a huge delay of 277and 276 days respectively. The petitioner has alsofiled Exts.P5 and P6 stay applications along withExhibits P2 and P4 appeals respectively. 4. The learned counsel for the petitioner submits that the appellate authority has not passedany order on the application for condonation ofdelay or the stay application filed along with Exts.P2 and P4 appeals. 5 3.Challenging Exhibit P1 assessment order, the petitioner had filed Exhibit P2 appeal with adelay of 277 days. Against Exhibit P3 penaltyorder, Exhibit P4 appeal is filed on 25.01.2023.The appeals were filed with a huge delay of 277and 276 days respectively. The petitioner has alsofiled Exts.P5 and P6 stay applications along withExhibits P2 and P4 appeals respectively. 4. The learned counsel for the petitioner submits that the appellate authority has not passedany order on the application for condonation ofdelay or the stay application filed along with Exts.P2 and P4 appeals. 5 5.The Learned Counsel for the petitioneralso submits that, as per CBDT Circular dated29.02.2016, if the assessee deposits 20% of theassessed tax and penalty amount, there would bean interim order till the disposal of the appeals.The said circular is not binding on the appellateauthority, the same being the quasi judicialauthority. Despite the above circular, the appellateauthority, being the quasi judicial authority, maygrant the interim order. 6.The learned counsel for the petitioner hasplaced reliance upon the single paragraph order ofthe Supreme Court in the case of PrincipalCommissioner of Income Tax Vs. LGElectronics India Pvt. Ltd. passed in Civil AppealNo.6850 of 2018 on 20.07.2018, from where it isclear that the Supreme Court has only said that theadministrative circular will not operate as a fetteron the power of the appellate authority to exercise its discretion for order on deposits or considerationof facts of the particular case. In that view of thematter, the Supreme Court has clarified that in all the cases where the appeal is filed, it will be opento the authorities, on the facts of individual cases,to grant deposit orders of a lesser amount than20%, pending appeal. 7. Thus, the Supreme Court has not said that no amount would be liable to be deposited forgranting an interim order. The Supreme Court hasonly clarified that the appellate authority may issuean order for depositing less than 20% tax amountdepending on the facts of the particular case. 8. The petitioner, prayer that without depositing any amount, this Court should grant aninterim order till the disposal of the stayapplication is liable to be rejected. I am of the viewthat the petitioner is not untitled to an order asprayed for especially when the petitioner has filed appeals with a delay of 277 days. 9.Therefore, this writ petition is disposed of only with a direction to the 3[rd] respondent to takeup the application for condonation of delay and ifthe delay is condoned, then decide the applicationfor staying the demand in pursuance to theassessment order. 10.The third respondent is granted one month’s time to decide the application forcondonation of delay and application for stay. 11. Writ petition is finally disposed of. rpr Sd/-DINESH KUMAR SINGHJUDGE APPENDIX OF WP(C) 28750/2023 PETITIONER’S EXHIBITS Exhibit P1 A TRUE COPY OF THE ASSESSMENT ORDER DATED 22-3-2022 UNDER SECTION 147 R.W.S 144 AND 144B OF THE ACT PASSED BY THE 2ND RESPONDENT FOR THE AY 2017-18 Exhibit P2 A TRUE COPY OF THE APPEAL ALONG WITH THE DELAY CONDONATION PETITION E-FILED ON 24-1-2023 BY THE PETITIONER BEFORE THE 3RD RESPONDENT FOR THE AY 2017-18 Exhibit P3 A TRUE COPY OF THE PENALTY ORDER DATED 27-9-2022 UNDER SECTION 270A OF THE ACT PASSED BY THE 1ST RESPONDENT FOR THE AY 2017-18 Exhibit P4 A TRUE COPY OF APPEAL E-FILED ON 25-1-2023 BEFORE THE 3RD RESPONDENT ALONG WITH THE DELAY CONDONATION Exhibit P5 A TRUE COPY OF THE STAY PETITION E-FILED ON 23-8-2023 IN EXHIBIT P-2 APPEAL BEFORE THE 3RD RESPONDENT:- CIT (APPEALS), NATIONAL FACELESS APPEAL CENTRE, DELHI FOR THE AY 2017-18 Exhibit P6 A TRUE COPY OF THE STAY PETITION E-FILED ON 23-8-2023 IN EXHIBIT P-4 APPEAL BEFORE THE 3RD RESPONDENT:- CIT (APPEALS), NATIONAL FACELESS APPEAL CENTRE, DELHI FOR THE AY 2017-18