Wp(C)/16414/2010 Of K.avara Hajee v. The Commissioner Of Income Tax

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE P.R.RAMACHANDRA MENON MONDAY, THE 12TH JULY 2010 / 21ST ASHADHA 1932 WP(C).No. 16414 of 2010(B) ---------------------------------------- PETITIONER(S): ------------------------ K. AVARA HAJEE, KATTUKANDAN HOUSE, KULUKILIYAD.P.O., KOTTAPPURAM, PALAKKAD DIST. BY ADV. SRI.C.K.RAMAKRISHNAN RESPONDENT(S): -------------------------- 1. THE COMMISSIONER OF INCOME TAX, KOCHI. 2. INCOME TAX OFFICER, WARD-2, PALAKKAD. 3. ADDITIONAL COMMISSIONER OF INCOME TAX, PALAKKAD RANGE, PALAKKAD. 4. STATE OF KERALA, REPRESENTED BY CHIEF SECRETARY,THIRUVANANTHAPURAM. R1 TO R3 BY ADV. SRI.JOSE JOSEPH, SC, FOR INCOME TAX. R4 BY GOVT. PLEADER THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 12/07/2010,THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: P.R.RAMACHANDRA MENON, J -------------------------------------------- WP(C) NO. 16414 OF 2010 -------------------------------------------- Dated this the 12[th] day of July, 2010 JUDGMENT The petitioner is challenging the correctness and sustainability ofExt.P2 notice demanding a sum of Rs.3,51,794/- in respect of theassessment year 1999-2000 and Rs.3,855/- in respect of the assessmentyear 2005-06. Various contentions have been raised, particularly placingreliance on Ext.P3 order passed by the Commissioner of Income Tax(Appeals-V), whereby an observation has been made in paragraph 5 that,the original assessment was an ex-parte order under Section 144estimating the income of the petitioner/appellant and accordingly holdingthat the penalty proceedings were not correct or sustainable, whichaccordingly were cancelled vide Ext.P3. The learned counsel submits that,there is absolutely no rhyme or reason for demanding the amount asshown in Ext.P2, even after cancellation of the penalty vide Ext.P3 andhence is under challenge. 2.The learned standing counsel for the department, withreference to the statement filed submits that, the idea and understandingof the petitioner is quite wrong and misconceived. It is brought to thenotice of this Court that, the cancellation effected by virtue of Ext.P3 isonly in respect of the ‘penalty’ levied under Section 271 (i) (c) of the WP(C) No. 16414/2010 Income Tax Act and is not with regard to the ‘tax’ element. The amountsought to be satisfied vide Ext.P2 is in respect of the ‘tax’ payable by thepetitioner for the concerned assessment years. The learned standingcounsel also submits that, being aggrieved of the original assessmentorder dated 11.02.2004, in respect of the assessment year 1999-00, thepetitioner had approached the Commissioner by filing a Revision Petitionunder Section 264; which however was rejected as per order dated10.02.2005. The impugned proceedings were subject to further challengeby filing statutory appeal, which however did not turn to be fruitful to the fullextent, as the said appeal was allowed only in part, as per order dated21.12.2006. 3.By virtue of the order passed by the appellate authority, theoriginal tax liability to an extent of Rs.9,35,624/- was brought down to just‘1/3[rd][’] of Rs.3,51,794/-. The petitioner did not choose to file any furtherappeal before the Tribunal and as such, the appellate order passed on21.12.2006 by the statutory appellate authority has become final. Thisbeing the position, the petitioner cannot vaguely or indirectly club the twodifferent cause of actions together and contend that no amount is liable tobe paid by the petitioner and as such, no interference is warranted, submitsthe learned counsel. WP(C) No. 16414/2010 3.By virtue of the order passed by the appellate authority, theoriginal tax liability to an extent of Rs.9,35,624/- was brought down to just‘1/3[rd][’] of Rs.3,51,794/-. The petitioner did not choose to file any furtherappeal before the Tribunal and as such, the appellate order passed on21.12.2006 by the statutory appellate authority has become final. Thisbeing the position, the petitioner cannot vaguely or indirectly club the twodifferent cause of actions together and contend that no amount is liable tobe paid by the petitioner and as such, no interference is warranted, submitsthe learned counsel. WP(C) No. 16414/2010 4.This Court finds considerable force in the said submission.There is no case for the petitioner that, the petitioner has challengedfixation of tax liability, after the disposal of the statutory appeal on21.12.2006, by resorting any procedure known to law and this being theposition, the challenge raised against Ext.P2 does not stand the test of law.More so, when the respondent has asserted in the statement, that theamount sought to be recovered from the petitioner is ‘not penalty’ but the‘tax’ element. With regard to the amount demanded in respect of theassessment year 2005-06, it is only a sum of Rs.3,855/-. With regard to thisextent as well, there is no such challenge raised in the Writ Petition.Accordingly, interference is declined and the Writ Petition is dismissed. dnc P.R.RAMACHANDRA MENONJUDGE