Wp(C)/24527/2014 Of Beaver Estates Private Limited v. The Principal Chief Commissioner Of Income Tax

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR.JUSTICE P.R.RAMACHANDRA MENON TUESDAY, THE 23RD DAY OF SEPTEMBER 2014/1ST ASWINA, 1936 WP(C).No. 24527 of 2014 (M) ---------------------------------------- PETITIONERS: ---------------------- 1. BEAVER ESTATES PRIVATE LIMITED,3RD FLOOR,PUTHURAN PLAZA, KPCC JUNCTION,M.G.ROAD,ERNAKULAM,KOCHI - 682011,REPRESENTED BY ITS MANAGING DIRECTOR MR.B.R.AJIT. 2. B.R.AJIT,MANAGING DIRECTOR,BEAVER ESTATES PRIVATE LIMITED,3RD FLOOR,PUTHURAN PLAZA, KPCC JUNCTION, M.G.ROAD,ERNAKULAM, KOCHI - 682011. BY ADV. SRI.SAIBY JOSE KIDANGOOR RESPONDENTS: ---------------------------- 1. THE PRINCIPAL CHIEF COMMISSIONER OF INCOME TAX,KOCHI - 682 018. 2. COMMISSIONER OF INCOME TAX,KOCHI, KERALA - 682 018. 3. COMMISSIONER OF INCOME TAX (APPEALS)-II,KOCHI, KERALA- 682 018.KOCHI, KERALA- 682 018. 4. DEPUTY COMMISSIONER OF INCOME TAX,CIRCLE 1 (1), KOCHI - 682 018.CIRCLE 1 (1), KOCHI - 682 018. 5. ASSISTANT COMMISSIONER OF INCOME TAX,CIRCLE 1 (1) KOCHI -682 018. 6. ASSISTANT COMMISSIONER OF INCOME TAX,CIRLCE 2 (1) KOCHI - 682 018.CIRLCE 2 (1) KOCHI - 682 018. BY SRI.JOSE JOSEPH, SC, FOR INCOME TAX THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 23-09-2014, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ---------------------------------------- APPENDIX PETITIONER(S)' EXHIBITS ------------------------------------- EXHIBIT-P1-TRUE COPY OF NOTICE UNDER SECTION 148 DATED 18/03/2013. EXHIBIT-P2-TRUE COPY OF 5TH RESPONDENTS LETTER DATED 04/10/2013. EXHIBIT-P3-TRUE COPY OF THE SHOW CAUSE NOTICES UNDER SEC 144 OF IT ACT FOR THE ASSESSMENT YEAR 2007-08 DATED 30/10/2013. ACT FOR THE ASSESSMENT YEAR 2007-08 DATED 30/10/2013. EXHIBIT-P4-TRUE COPY OF THE STATEMENT UNDER SEC 133 (A) DATED 21/12/2012. DATED 21/12/2012. EXHIBIT-P5-TRUE COPY OF THE ACKNOWLEDGMENT EVIDENCING PAYMENT OF TAX FOR THE ASSESSMENT YEAR 2007-2008. TAX FOR THE ASSESSMENT YEAR 2007-2008. EXHIBIT-P6-TRUE COPY OF THE PETITIONER'S LETTER DATED 25/03/2014 ALONG WITH COMPUTATION OF ASSESSMENT AND EVIDENCES. ALONG WITH COMPUTATION OF ASSESSMENT AND EVIDENCES. EXHIBIT-P7-TRUE COPY OF THE ASSESSMENT ORDER ALONG WITH TAX CALCULATION STATEMENT. EXHIBIT-P7(a)-TRUE COPY OF THE DEMAND NOTICE UNDER SECTION 156 OF I.T. ACT. I.T. ACT. EXHIBIT-P7(b)-TRUE COPY OF THE NOTICE UNDER SEC 274 READ WITH SECTION 271(c) OF THE I.T. ACT. SECTION 271(c) OF THE I.T. ACT. EXHIBIT-P7(c)-TRUE COPY OF THE NOTICE UNDER SEC. 271F OF I.T ACT. EXHIBIT-P8-TRUE COPY OF THE SHOWCAUSE NOTICE UNDER SECTION 279(1) DATED 25/03/2014. EXHIBIT-P9-TRUE COPY OF THE PETITIONER'S LETTER DATED 27/03/2014. EXHIBIT-P10-TRUE COPY OF THE LETTER DATED 22/04/2014. EXHIBIT-P11-TRUE COPY OF THE APPLICATION DATED 11/08/2014 FILED BY THE PETITIONER BEFFORE THE IST RESPONDENT. EXHIBIT-P12-TRUE COPY OF THE RTI REPLY DATED 26/05/2014. RESPONDENTS EXHIBITS: --------------------------------------- NIL //TRUE COPY// P.S. TO JUDGE P.R. RAMACHANDRA MENON, J. ======================== -------------------------------------------- Dated this the 23[rd] day of September, 2014 JUDGMENT The first petitioner is a private limited company, having its EXHIBIT-P7(c)-TRUE COPY OF THE NOTICE UNDER SEC. 271F OF I.T ACT. EXHIBIT-P8-TRUE COPY OF THE SHOWCAUSE NOTICE UNDER SECTION 279(1) DATED 25/03/2014. EXHIBIT-P9-TRUE COPY OF THE PETITIONER'S LETTER DATED 27/03/2014. EXHIBIT-P10-TRUE COPY OF THE LETTER DATED 22/04/2014. EXHIBIT-P11-TRUE COPY OF THE APPLICATION DATED 11/08/2014 FILED BY THE PETITIONER BEFFORE THE IST RESPONDENT. EXHIBIT-P12-TRUE COPY OF THE RTI REPLY DATED 26/05/2014. RESPONDENTS EXHIBITS: --------------------------------------- NIL //TRUE COPY// P.S. TO JUDGE P.R. RAMACHANDRA MENON, J. ======================== -------------------------------------------- Dated this the 23[rd] day of September, 2014 JUDGMENT The first petitioner is a private limited company, having its main object to construct, transfer, sale or disposal of all types ofbuildings and the 2[nd] petitioner is its Managing Director. In thecourse of business, they transacted various conveyances, whichincluded purchase of plots and development of the same as'Silver Sand Island', near Vytilla in Ernakulam. But the project ofthe petitioners could not be completed as desired, because ofobjections from the GCDA and other authorities. In the saidcircumstance, there was no other alternative for the petitioners,but to sell the property to a prospective purchaser. 2. In the course of survey conducted by the 6[th] respondent, various particulars were collected and proceedings were takenagainst the petitioners under different provisions of the IncomeTax Act. Notice was also issued under Section 148 of the IncomeTax Act on 08.03.2013 in respect of the assessment year 2007-08, referring to the 'capital gain' accumulated. 3. In the course of further proceedings, assessment wasfinalised against the petitioners as per Ext.P7 series, followed by W.P.C. No. 24527 of 2014 -2- demand notices under Section 156 of the Income Tax Act. Beingaggrieved of the assessment, the petitioners moved the thirdrespondent/the Commissioner of Income Tax (Appeals)-II, beforewhom the appeals are pending. It is in the meanwhile, that thepetitioners have been served with Ext.P8 notice under Section279(1) of the Act, as to why prosecution proceedings shall not beinitiated under Section 276 CC of the Income Tax Act. It is statedthat the petitioners have submitted a detailed reply. Butwithout any regard to the same, the proceedings were pursued,leading to C.C..915 of 2014 before the Addl. C.J.M. Court,Ravipuram and it was only on coming across the summonsserved upon the petitioners, that they could realise that theproceedings had already been initiated, which according to thepetitioners is without considering their objections and hence notcorrect or sustainable. 4. The learned Counsel for the petitioners submits that, byvirtue of the turn of events and other embarrassingcircumstances, the petitioners have decided to seek forpermission of the respondents for compounding the offence, asprovided under Section 279 (2) of the Act. It was accordingly,that Ext.P11 representation was preferred before the first W.P.C. No. 24527 of 2014 -3- respondent/Principal Chief Commissioner of Income Tax. Theprayer is to cause the same to be considered within the shortestpossible time. 5. Heard the learned Standing Counsel for the respondentsas well. 6. In view of the limited nature of the reliefs sought for, this Court does not find it necessary to deal with the merits ofthe case. Accordingly, the first respondent is directed to considerExt.P11 representation and pass appropriate orders, afteraffording an opportunity of hearing to the petitioners, at theearliest, at any rate, within one month from the date of receipt ofa copy of the judgment. Further steps by the respondents inconnection with prosecution in C.C.No.915 of 2014 of the Addl.C.J.M. Court, Ravipuram may be kept in abeyance till such time.The writ petition is disposed of. 5. Heard the learned Standing Counsel for the respondentsas well. 6. In view of the limited nature of the reliefs sought for, this Court does not find it necessary to deal with the merits ofthe case. Accordingly, the first respondent is directed to considerExt.P11 representation and pass appropriate orders, afteraffording an opportunity of hearing to the petitioners, at theearliest, at any rate, within one month from the date of receipt ofa copy of the judgment. Further steps by the respondents inconnection with prosecution in C.C.No.915 of 2014 of the Addl.C.J.M. Court, Ravipuram may be kept in abeyance till such time.The writ petition is disposed of. The petitioners shall produce a copy of the judgment alongwith a copy of the writ petition before the first respondent forfurther steps. P.R. RAMACHANDRA MENON, JUDGE.