Wp(C)/10023/2024 Of M/S. Alka Ventures Private Limited v. Additional / Joint / Deputy / Assistant Commissioner Of Income Tax / Income Tax Officer

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE GOPINATH P. FRIDAY, THE 15 DAY OF MARCH 2024 / 25TH PHALGUNA, 1945WP(C) NO. 10023 OF 2024 PETITIONER: M/S. ALKA VENTURES PRIVATE LIMITED,T.C. 36/1690(1) MEENA, SUBHASH NAGAR, TRIVANDRUM, REPRESENTED BY ITS FINANCE MANAGER & AUTHORIZED SIGNATORY, SHRI. KUMAR MADHAVAN. BY ADVS. G.MINI(1748) P.J.ANILKUMARP.S.SREE PRASAD RESPONDENTS: 1ADDITIONAL / JOINT / DEPUTY / ASSISTANT COMMISSIONER OFINCOME TAX / INCOME TAX OFFICER,INCOME TAX / INCOME TAX OFFICER, NATIONAL FACELESS ASSESSMENT CENTRE, NEW DELHI, PIN – 110 001.PIN – 110 001. 2NATIONAL FACELESS ASSESSMENT CENTRE, (UNDER THE NATIONAL FACELESS APPEALS SCHEME),NEW DELHI, REPRESENTED BY THE CIT (APPEALS), PIN – 110 001. 3THE COMMISSIONER OF INCOME TAX (APPEALS),NATIONAL FACELESS ASSESSMENT CENTRE,NEW DELHI, NATIONAL FACELESS ASSESSMENT CENTRE,NEW DELHI, PIN – 110 001. 4THE JOINT COMMISSIONER OF INCOME TAX,KARAMANA (PO),THIRUVANANTHAPURAM, PIN – 695 002.BY ADVS.KARAMANA (PO),THIRUVANANTHAPURAM, PIN – 695 002.BY ADVS. SRI.CHRISTOPHER ABRAHAM, INCOME TAX DEPARTMENT SRI. A. KUMAR (SR.) P.R. AJITH KUMAR, SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON15.03.2024, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: JUDGMENT The petitioner is a Private Limited Company engaged in the real estate business. For the assessment year 2016-17, thepetitioner did not file a return of income. Proceedings wereinitiated for assessment, following which an order was issuedunder Section 147 r/w Section 144 and Section 144B of theIncome Tax Act, 1961 (hereinafter referred to as ‘the 1961 Act’).There were some transactions of purchase and sale ofimmovable property in that assessment year and theproceedings were finalized against the petitioner on the basisthat there was unexplained investment under Section 69 of the1961 Act. The petitioner was, therefore, assessed at the higherrate of tax by applying the provisions of Section 115 BBE of the1961 Act. 2.According to the petitioner, the petitioner hadearlier approached this Court challenging the order ofassessment by filing W.P.(C)No.13736/2022. However, that writpetition was disposed of on 30.01.2024 refusing to interferewith the order of assessment and directing that the petitioner According to the petitioner, the petitioner had will have to avail statutory remedies against the order ofassessment. According to the petitioner, he filed an appealbefore the authority under the Faceless Appeal Scheme, 2021along with an application for stay. It is the case of the petitionerthat by virtue of the provisions contained in Section 249 of the1961 Act, the Appellate Authority may having regard to theproviso to sub-section (4) of Section 249 of the 1961 Act exemptthe petitioner from the requirement of paying the advance tax incases where a return of income has not been filed by thepetitioner / assessee. It is submitted that in the facts andcircumstances of this case, a demand in the order of assessment(Ext.P15) is Rs.68 crores. It is submitted that for all thesubsequent assessment years, including for the assessment year2023-2024, the petitioner has filed a loss return and the samehas been accepted along with an intimation under Section143(1) of the 1961 Act. It is submitted that considering theaforesaid facts, the petitioner may be permitted to prosecute hisappeal against Ext.P15 order of assessment without having topay the advance tax in terms of the proviso to sub-section (4) ofSection 249 of the 1961 Act. 3.Sri.A.Kumar, the learned Senior Counsel appearingfor the petitioner, on the instructions of Adv.G.Mini hasreferred to the provisions of Section 249 of the 1961 Act tocontend that the case of the petitioner / assessee falls withinSection 249(4)(b) of the 1961 Act and therefore, by theapplication of the proviso to that sub-section, the AppellateAuthority is well within its powers to exempt the petitioner frompayment of any amount as advance tax for maintaining theappeal. 4.The learned Standing Counsel appearing for therespondent Department would submit that the demand relatesto the assessment year 2016-17. It is submitted that even in theyear 2017-18, the petitioner has made substantial investmentsin immovable property while not filing a return of income orpaying even the admitted tax in respect of the assessment year2016-17. It is submitted that since the demand in Ext.P15 orderof assessment is in excess of Rs.68 crores, even if the appellateauthority were to consider the case as one covered by theproviso to Section 249(4)(b) of the 1961 Act, a substantialamount will have to be remitted by the petitioner for maintaining the appeal. 5.Having heard the learned Senior Counsel appearingfor the petitioner and the learned Standing Counsel appearingfor the respondent Department, I am of the view that since it isnot seriously disputed that the case of the petitioner falls underthe proviso Section 249(4)(b) of the 1961 Act, Ext.P17 appealfiled by the petitioner against Ext.P15 order of assessment forthe assessment year 2016-17 can be directed to be disposed ofon merits after affording an opportunity of hearing to thepetitioner on the condition that the petitioner remits a total sumof Rs 12 crores against the demands in Ext.P15 order ofassessment. An amount of Rs.11.75 crores shall be remitted bythe petitioner in 8 equal monthly installments commencingfrom 15.04.2024. Subsequent installments shall be paid on orbefore the 15[th] day of the succeeding months. The petitionershall remit a sum of Rs.25 lakhs towards the demand in Ext.P15on or before 31.03.2024. If the petitioner fails to remit theamounts as directed above, it will be open to the Department toproceed for recovery of amounts assessed in terms of Ext.P15.Since the above condition is to be satisfied for maintaining the appeal, it is directed that the appeal filed by the petitioner shallbe taken up and adjudicated only after the entire amounts (Rs12 crores) payable by the petitioner in terms of this judgmentare paid, as directed. The writ petition will stand disposed of as above. DK Sd/-GOPINATH P.JUDGE APPENDIX OF WP(C) 10023/2024 PETITIONER EXHIBITS Exhibit P1TRUE COPY OF THE ACKNOWLEDGEMENT OFTHE RETURNS FILED FOR AY 2017-18 ,DATED 31/03/2018.THE RETURNS FILED FOR AY 2017-18 ,DATED 31/03/2018. Exhibit P2TRUE COPY OF THE ACKNOWLEDGEMENT OFTHE RETURNS FILED FOR AY 2018-19,DATED 30/10/2018THE RETURNS FILED FOR AY 2018-19,DATED 30/10/2018 Exhibit P3TRUE COPY OF THE ACKNOWLEDGEMENT OFTHE RETURNS FILED FOR AY 2019-20,DATED 26/09/2020THE RETURNS FILED FOR AY 2019-20,DATED 26/09/2020 Exhibit P4TRUE COPY OF THE ACKNOWLEDGEMENT OFTHE RETURNS FILED FOR AY 2020-21,DATED 29/03/2021THE RETURNS FILED FOR AY 2020-21,DATED 29/03/2021 Exhibit P5TRUE COPY OF THE ACKNOWLEDGEMENT OFTHE RETURNS FILED FOR AY 2021-22,DATED 31/03/2022THE RETURNS FILED FOR AY 2021-22,DATED 31/03/2022 Exhibit P6TRUE COPY OF THE ACKNOWLEDGEMENT OFTHE RETURNS FILED FOR AY 2022-23,DATED 23/12/2022THE RETURNS FILED FOR AY 2022-23,DATED 23/12/2022 Exhibit P7TRUE COPY OF THE ACKNOWLEDGEMENT OFTHE RETURNS FILED FOR AY 2023-24,DATED 30/12/2023THE RETURNS FILED FOR AY 2023-24,DATED 30/12/2023 Exhibit P8TRUE COPY OF THE INTIMATION ORDERISSUED UNDER SECTION 143(1) FOR THERETURN FILED FOR AY 2017-18. DATED28/06/2018ISSUED UNDER SECTION 143(1) FOR THERETURN FILED FOR AY 2017-18. DATED28/06/2018 Exhibit P5TRUE COPY OF THE ACKNOWLEDGEMENT OFTHE RETURNS FILED FOR AY 2021-22,DATED 31/03/2022THE RETURNS FILED FOR AY 2021-22,DATED 31/03/2022 Exhibit P6TRUE COPY OF THE ACKNOWLEDGEMENT OFTHE RETURNS FILED FOR AY 2022-23,DATED 23/12/2022THE RETURNS FILED FOR AY 2022-23,DATED 23/12/2022 Exhibit P7TRUE COPY OF THE ACKNOWLEDGEMENT OFTHE RETURNS FILED FOR AY 2023-24,DATED 30/12/2023THE RETURNS FILED FOR AY 2023-24,DATED 30/12/2023 Exhibit P8TRUE COPY OF THE INTIMATION ORDERISSUED UNDER SECTION 143(1) FOR THERETURN FILED FOR AY 2017-18. DATED28/06/2018ISSUED UNDER SECTION 143(1) FOR THERETURN FILED FOR AY 2017-18. DATED28/06/2018 Exhibit P9TRUE COPY OF THE INTIMATION ORDERISSUED UNDER SECTION 143(1) FOR THERETURN FILED FOR AY 2018-19. DATED11/04/2019ISSUED UNDER SECTION 143(1) FOR THERETURN FILED FOR AY 2018-19. DATED11/04/2019 Exhibit P10TRUE COPY OF THE INTIMATION ORDERISSUED UNDER SECTION 143(1) FOR THERETURN FILED FOR AY 2019-20. DATED04/10/2020ISSUED UNDER SECTION 143(1) FOR THERETURN FILED FOR AY 2019-20. DATED04/10/2020 Exhibit P11TRUE COPY OF THE INTIMATION ORDERISSUED UNDER SECTION 143(1) FOR THERETURN FILED FOR AY 2020-21. DATED29/03/2021ISSUED UNDER SECTION 143(1) FOR THERETURN FILED FOR AY 2020-21. DATED29/03/2021 Exhibit P12TRUE COPY OF THE INTIMATION ORDERISSUED UNDER SECTION 143(1) FOR THERETURN FILED FOR AY 2021-22. DATED31/03/2022ISSUED UNDER SECTION 143(1) FOR THERETURN FILED FOR AY 2021-22. DATED31/03/2022 Exhibit P13 TRUE COPY OF THE INTIMATION ORDERISSUED UNDER SECTION 143(1) FOR THERETURN FILED FOR AY 2022-23. DATED23/12/2022ISSUED UNDER SECTION 143(1) FOR THERETURN FILED FOR AY 2022-23. DATED23/12/2022 Exhibit P14 TRUE COPY OF THE INTIMATION ORDERISSUED UNDER SECTION 143(1) FOR THERETURN FILED FOR AY 2023-24. DATED30/12/2023ISSUED UNDER SECTION 143(1) FOR THERETURN FILED FOR AY 2023-24. DATED30/12/2023 Exhibit P15TRUE COPY OF THE ASSESSMENT ORDERDATED 31.3.2022DATED 31.3.2022 Exhibit P16TRUE COPY OF THE JUDGMENT IN WRITPETITION(C) NO.13736 DATED 30.1.2024OF THIS HON'BLE COURT.PETITION(C) NO.13736 DATED 30.1.2024OF THIS HON'BLE COURT. Exhibit P17TRUE COPY OF THE APPEAL MEMORANDUMDATED 19.2.2024 TOGETHER WITH THEACKNOWLEDGEMENTDATED 19.2.2024 TOGETHER WITH THEACKNOWLEDGEMENT Exhibit P18 TRUE COPY OF THE APPLICATION FOR STAYDATED 19.2.2024.DATED 19.2.2024. Exhibit P19 TRUE COPY OF THE APPLICATION FOREXEMPTION DATED NIL.EXEMPTION DATED NIL. Exhibit P20 TRUE COPY OF THE COMMUNICATION DATED6.3.2024 OF THE PETITIONER TO THEJOINT COMMISSIONER6.3.2024 OF THE PETITIONER TO THEJOINT COMMISSIONER