Wp(C)/21526/2019 Of Hi Care Gloves Pvt.ltd v. Deputy Commissioner Of Income Tax

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE S.V.BHATTI WEDNESDAY, THE 07TH DAY OF AUGUST 2019 / 16TH SRAVANA, 1941 WP(C).No.21526 OF 2019(M) PETITIONER: HI CARE GLOVES PVT.LTD.MARANGATTUPALLY, KOTTAYAM DISTRICT, PIN - 686 635, REPRESENTED BY ITS MANAGING DIRECTOR, MR. JOHNS A NEERAKKAL, AGED 50 YEARS, S/O. ALEXANDER, NEERAKKAL @KALLIDUKKIL @ VADAKKEKALAPPURAKKAL HOUSE, KOOTHATTUKULAM POST, ERNAKULAM. BY ADV. SRI.JOHN MATHEW (THEREZHATH) RESPONDENTS: 1DEPUTY COMMISSIONER OF INCOME TAXWARD NO.V, CENTRAL CIRCLE, KOTTAYAM - 686 001.WARD NO.V, CENTRAL CIRCLE, KOTTAYAM - 686 001.2THE COMMISIONER OF INCOME TAX (APPEALS)PUBLIC LIBRARY BUILDING, LAL BAHADUR SASTHRI ROAD, KOTTAYAM - 686 001.PUBLIC LIBRARY BUILDING, LAL BAHADUR SASTHRI ROAD, KOTTAYAM - 686 001. 3THE STATE BANK OF INDIAMARANGATTUPILLI BRANCH, PALA MARANGATTUPILLY KOZHA ROAD, MARANGATTUPILLI, PIN - 686 635, REPRESENTED BY ITS BRANCH MANAGER.MARANGATTUPILLI BRANCH, PALA MARANGATTUPILLY KOZHA ROAD, MARANGATTUPILLI, PIN - 686 635, REPRESENTED BY ITS BRANCH MANAGER. 4THE KOTTAYAM DISTRICT CO-OPERATIVE BANK,KADAPLAMATTOM BRANCH, KADAPLAMATTOM, KOTTAYAM, PIN - 686 571, KADAPLAMATTOM BRANCH, KADAPLAMATTOM, KOTTAYAM, PIN - 686 571, REPRESENTED BY ITS BRANCH MANAGER. 5THE AXIS BANKPALA BRANCH, PUTHUMANA ARCADE, PALA, KOTTAYAM, PIN – 686 575REPRESENTED BY ITS BRANCH MANAGERPALA BRANCH, PUTHUMANA ARCADE, PALA, KOTTAYAM, PIN – 686 575REPRESENTED BY ITS BRANCH MANAGER 6THE AXIS BANK THODUPUZHA BRANCH, MINI CIVIL STATION, 10/72, A & B, RUBBER MARKETING SOCIETY BUILDING, THODUPUZHA,IDUKKI DISTRICT, PIN - 685 584. BY SRI.JOSE JOSEPH - S.CSMT. N. DEEPASRI.ATHUL SHAJISRI.PAULOCHAN ANTONY THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON07.08.2019, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: JUDGMENT The petitioner apprehending imminent executionor realisation of the tax payable by the petitioner videExts. P1 and P2 orders, filed Exts.P3 and P4 appealsbefore the second respondent, with delay of 937 and555 days respectively and also applications for stay ofthe assessment orders in Exts.P1 and P2. Thepetitioner further apprehending realisation of amountpursuant to freezing of Bank Account No:67091379742 maintained with the State Bank of IndiaatMarangattupallyBranch,AccountNo:050161000620001 of the Kottayam District Co-operative Bank at Kadaplamattom Branch, AccountNo: 616010200000347 maintained with Axis Bank atPala Branch, Account No: 909030033720170 of AxisBank at Thodupuzha Branch and Account No:909020033056029 of Axis Bank, Thodupuzha Branchhas filed the instant writ petition for the followingreliefs:- “i) Direct the second respondent to keep allthe coercive proceedings including the freezing ofthe bank accounts of the petitioner companyinitiated under Ext.P5 summons under abeyancetill the final disposal of the Ext.P3 and P4 appeal.ii)Direct the Respondents 3 to 6 to defreezethe respective banks accounts of the petitionercompany bearing No. 67091379742 maintainedwith the State Bank of India at MarangattupallyBranch, Account No: 050161000620001 of theKottayam District Co-operative Bank atKadaplamattomBranch,AccountNo.616010200000347 maintained with Axis Bank atPala Branch, Account No: 909030033720170 ofAxis Bank at Thodupuzha Branch and AccountNo. 909020033056029 of Axis Bank, ThodupuzhaBranch. iii)Issue such other orders, directions or writas this Hon'ble Court may deem fit, just andnecessary in the interest of justice.” 2.The writ prayers challenge the coercive steps now taken by the respondents for realising the amountdetermined by the orders in Exts. P1 and P2. 3.Adv. John Mathew Therezhath, by referring to several grounds in fact and law raised in the writpetition firstly attempts to convince this court to stay iii)Issue such other orders, directions or writas this Hon'ble Court may deem fit, just andnecessary in the interest of justice.” 2.The writ prayers challenge the coercive steps now taken by the respondents for realising the amountdetermined by the orders in Exts. P1 and P2. 3.Adv. John Mathew Therezhath, by referring to several grounds in fact and law raised in the writpetition firstly attempts to convince this court to stay all further proceedings pursuant to freezing of bankaccounts. He alternatively submits that the substantialprayers and grounds are now pending consideration inExts.P3 & P4 appeals, this Court, if considers directingthe second respondent to pass appropriate orders onExts.P3 and P4 appeals, where the applications forcondonation of delay are pending ends of justice aremet and to prove bonafides of petitioner, the learnedcounsel offers to deposit 10% of the tax demanded inExts. P1 and P2 orders for consideration and disposal ofdelay condonation petitions in Exts.P3 and P4. 4.The learned Standing Counsel opposes thewrit prayers in all fours. The first and foremostobjection is against the maintainability of the writprayers, for the prayers are not independent or standalone reliefs available to petitioner, in as much as thecoercive steps are in the nature of execution of orderswhich have become final. Unless the assessment ordersare set aside or modified to exception to theserealisations steps could be taken in the particular fact WP(C).No.21526 OF 2019(M) 6 situation of this case. The orders made by therespondents 1 and 2, freezing bank accounts is eitherin continuation of tax liability already determined andthe accounts are frozen only to recover the taxlegitimately determined by the first respondent. Theappeals are filed with enormous delay and this Court ifshows indulgence and issues direction to the secondrespondent to consider and dispose of the stay petitionspending in Exts.P3 and P4, such direction in a matterwith singular facts does not go with the judicial reviewthis Court exercises under Article 226 of theConstitution of India, particularly, where all the issuesare substantially pending before the secondrespondent. He objects to granting stay or allowing thepetitioner to operate the bank accounts referred toabove for the petitioner if is allowed to operate thebank accounts, the Department will again have to startthe proceedings afresh, in such an event, theDepartment will also suffer prejudice. 5.I have perused the record and noted the realities staring at the petitioner and also that the appeals now filed before the second respondent arestatutory appeals which ought not to be shut out exceptfor valid reasons noted and recorded by the secondrespondent. 6. While recording the above statement, this Court hastens to add that all issues in this behalf are at large before the second respondent. The secondrespondent exercises his jurisdiction in accordance withlaw and no guidance is warranted from Court. Anyobservation made in this behalf ought not to beappreciated as expressing a view by this Court on theconduct of the petitioner. 7. Be that as it may, all the bank accounts of the petitioner are frozen. The petitioner offers todeposit 10% of the amount determined in Exts.P1 andP2. Now the apprehension voiced by the petitioner isthat the first respondent will go to the next step andwithdraw the entire tax amount payable by thepetitioner from the frozen account. 8.Keeping in view the balance of convenienceand also enable the petitioner to work out the remedyof appeal, the writ petition is disposed of by thisjudgment. The case no doubt presents on both sidessingular facts, therefore the discretion of this Court isalso exercised in a measured way ensuring preservationof the interest of all the parties during the pendency ofconsideration of delay petitions or disposal of appeals. 7. Be that as it may, all the bank accounts of the petitioner are frozen. The petitioner offers todeposit 10% of the amount determined in Exts.P1 andP2. Now the apprehension voiced by the petitioner isthat the first respondent will go to the next step andwithdraw the entire tax amount payable by thepetitioner from the frozen account. 8.Keeping in view the balance of convenienceand also enable the petitioner to work out the remedyof appeal, the writ petition is disposed of by thisjudgment. The case no doubt presents on both sidessingular facts, therefore the discretion of this Court isalso exercised in a measured way ensuring preservationof the interest of all the parties during the pendency ofconsideration of delay petitions or disposal of appeals. a)The petitioner deposits 10% of the taxamount demanded through Exts.P1 and P2 within oneweek from today. b) The petitioner accompanied by a copy of this judgment and also proof of payment of 10% asdirected by this Court, appears before the secondrespondent and requests for consideration and disposalof delay condonation petitions within one weekthereafter. c)The second respondent considers anddisposes of the delay condonation petitions within twoweeks from the date of appearance marked by the DCS petitioner as directed by this judgment. d)The respondents are directed not to recoveror realise the amount from the frozen bank accounts fora period of three weeks from today. SD/- S.V.BHATTI JUDGE PETITIONER'S/S EXHIBITS: APPENDIX EXHIBIT P6THE TRUE COPY OF THE INTERIM APPLICATION FOR STAY FILED ALONG WITH EXT.P3 APPEAL PENDING ON THE FILE OF THE 2ND RESPONDENT.FOR STAY FILED ALONG WITH EXT.P3 APPEAL PENDING ON THE FILE OF THE 2ND RESPONDENT.