Wp(C)/31822/2013 Of Sinkaram Muthuswamy Chettiar v. The Assitant Commissioner Of Incometax

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR.JUSTICE P.R.RAMACHANDRA MENON THURSDAY, THE 13TH DAY OF MARCH 2014/22ND PHALGUNA, 1935 WP(C).No. 31822 of 2013 (C) ---------------------------- PETITIONER(S): -------------------------- SINKARAM MUTHUSWAMY CHETTIAR, 43/896, ARUN NIVAS, AYYAPPANKAVU, KOCHI-682 018. BY ADVS.SRI.KMV.PANDALAI, SMT.S.HEMALATHA. RESPONDENT(S): ---------------------------- 1. THE ASSISTANT COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-2, ERNAKULAM, CHITTOOR ROAD, KOCHI-682 011. CENTRAL CIRCLE-2, ERNAKULAM, CHITTOOR ROAD, KOCHI-682 011. 2. THE COMMISSIONER OF INCOME-TAX (CENTRAL), COCHIN, M.G. ROAD, KOCHI-682 011. * ADDL. R3 IMPLEADED 3. THE COMMISSIONER OF INCOME TAX (APPEALS)-II, KERABHAVAN, ERNAKULAM, KOCHI-682 016. KERABHAVAN, ERNAKULAM, KOCHI-682 016. * IS IMPLEADED AS PER ORDER DATED 13/03/2014 IN I.A. NO.3861/2014. BY SRI.P.K.R.MENON, SENIOR SC, ADV. SRI.JOSE JOSEPH, SC. THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 13-03-2014, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C).No. 31822 of 2013 (C) APPENDIX PETITIONER'S EXHIBITS:- P1: COPY OF PANCHANAMA CHN-10-10SV-E DATED 05/08/2010. P1(A): PANCHANAMA CHN-10-10-SC/D DATED 05/08/2010. P1(B): PANCHANAMA VKP/CHN/ 10-2010/CS DATED 05/08/2010. P2: COPY OF INVENTORY OF JEWELLERY NO.CHN-10-10-SV/A DATED 05.08.2010.DATED 05.08.2010. P3:COPY OF THE LETTER DATED 26.08.2013 SENT BY THE PETITIONER TO THE 1ST RESPONDENT.THE 1ST RESPONDENT. P4: COPY OF THE LETTER DATED 04.10.2013 ISSUED BY THE 1ST RESPONDENT.1ST RESPONDENT. P5: COPY OF THE LETTER DATED 08.10.2013 FILED BY THE PETITIONER BEFORE THE 2ND RESPONDENT.BEFORE THE 2ND RESPONDENT. P6.COPY OF THE APPEAL FILED BY THE PETITIONER BEFORE THE COMMISSIONER OF INCOME TAX (APPEALS)-II, ERNAKULAM FOR THE ASSESSMENT YEAR 2005-06.COMMISSIONER OF INCOME TAX (APPEALS)-II, ERNAKULAM FOR THE ASSESSMENT YEAR 2005-06. P6A.COPY OF THE APPEAL FILED BY THE PETITIONER BEFORE THE COMMISSIONER OF INCOME TAX (APPEALS)-II, ERNAKULAM FOR THE ASSESSMENT YEAR 2006-07.COMMISSIONER OF INCOME TAX (APPEALS)-II, ERNAKULAM FOR THE ASSESSMENT YEAR 2006-07. P6BCOPY OF THE APPEAL FILED BY THE PETITIONER BEFORE THE COMMISSIONER OF INCOME TAX (APPEALS)-II, ERNAKULAM FOR THE ASSESSMENT YEAR 2007-08.COMMISSIONER OF INCOME TAX (APPEALS)-II, ERNAKULAM FOR THE ASSESSMENT YEAR 2007-08. P6CCOPY OF THE APPEAL FILED BY THE PETITIONER BEFORE THE COMMISSIONER OF INCOME TAX (APPEALS)-II, ERNAKULAM FOR THE ASSESSMENT YEAR 2008-09.COMMISSIONER OF INCOME TAX (APPEALS)-II, ERNAKULAM FOR THE ASSESSMENT YEAR 2008-09. P6DCOPY OF THE APPEAL FILED BY THE PETITIONER BEFORE THE COMMISSIONER OF INCOME TAX (APPEALS)-II, ERNAKULAM FOR THE ASSESSMENT YEAR 2009-10.COMMISSIONER OF INCOME TAX (APPEALS)-II, ERNAKULAM FOR THE ASSESSMENT YEAR 2009-10. P6ECOPY OF THE APPEAL FILED BY THE PETITIONER BEFORE THE COMMISSIONER OF INCOME TAX (APPEALS)-II, ERNAKULAM FOR THE ASSESSMENT YEAR 2010-11.COMMISSIONER OF INCOME TAX (APPEALS)-II, ERNAKULAM FOR THE ASSESSMENT YEAR 2010-11. RESPONDENT'S EXHIBITS:- EXT.R1ACOPY OF THE LETTER DATED 21/10/2013. //TRUE COPY// P.R. RAMACHANDRA MENON J. ~~~~~~~~~~~~~~~~~~~~~~W.P.(C) No. 31822 of 2013~~~~~~~~~~~~~~~~~~~~~Dated, this the 13[th] day of March, 2014 JUDGMENT The petitioner has approached this Court with the followingprayers : “a. Call for the records leading to the issue of Exhibit P4and to quash the same by issue of a writ of certiorari. b. Issue a writ of mandamus directing the respondents to return the surplus cash and jewellery to thepetitioner forthwith with interest; c. Issue any other writ/order or direction as thisHon'ble Court may deem fit and proper in thecircumstances of the case. 2. The case of the petitioner is that pursuant to the search RESPONDENT'S EXHIBITS:- EXT.R1ACOPY OF THE LETTER DATED 21/10/2013. //TRUE COPY// P.R. RAMACHANDRA MENON J. ~~~~~~~~~~~~~~~~~~~~~~W.P.(C) No. 31822 of 2013~~~~~~~~~~~~~~~~~~~~~Dated, this the 13[th] day of March, 2014 JUDGMENT The petitioner has approached this Court with the followingprayers : “a. Call for the records leading to the issue of Exhibit P4and to quash the same by issue of a writ of certiorari. b. Issue a writ of mandamus directing the respondents to return the surplus cash and jewellery to thepetitioner forthwith with interest; c. Issue any other writ/order or direction as thisHon'ble Court may deem fit and proper in thecircumstances of the case. 2. The case of the petitioner is that pursuant to the search conducted by the Income Tax Department on 05.08.2010 and06.08.2010, in the residential and official premises of the petitioner,who is stated as a lottery agent, a sum of Rs. 69,82,730/- was seizedas per Ext. P1 and 1920.55 gms of jewellery was seized as per Ext.P2; besides seized a sum of Rs.3,15,23,579/- deposited in differentbanks. The assessment proceedings were finalized under Section : 2 : 143 (3) r/w s. 153A for the assessment years 2005-06, 2006 -'07, 2007 - '08, 2008 - '09, 2009 - '10, 2010 - 11 and 2011 - '12.It is stated that the petitioner has preferred statutory appeal beforethe appellate authority, which is stated as pending. The case ofthe petitioner is that, even after adjusting the maximum liabilitythat can be mulcted upon the shoulders of the petitioner, hugeamounts are still lying at the hands of the department, to an extentof more than Rs. 1 Crore, which is sought to be returned along withjewellery. Since the claim mooted by the petitioner vide Ext. P5has not been favourably considered, the petitioner is before thisCourt. 3. A detailed statement has been filed on behalf of therespondents, pointing out the facts and figures. Paragraphs 6 and7 of which read as follows : “6. As on date, the existing demand of Rs.2,84,18,674/- has been adjusted. The last of thedemand adjusted is on 23.01.2914 of Rs. 1,88,79,309/-i.e. a few years back. However, it may be noted thatthough the penalty proceedings were initiated u/s 271(1) (c) of the Income Tax Act 1961, the same had to bekept in abeyance as the assessee preferred an appealbefore the Commissioner of Income Tax (Appeals)against the Assessment Order passed by the assessing officer. The matter is kept under abeyance as perSection 275 (a) of Income Tax Act 1961. It not forthis, even the penalty proceeding also would have beencompleted and a final demand payable crystalised 7. With reference to paragraph 8, it issubmitted that as stated in reply to para 3 above, theseized cash in the hands of the assessee is Rs.3,58,58,498/- and amount of demand adjusted asstated in reply to para 6 above is Rs. 2,84,18,674/-.Thus excess cash now available with the department isonly Rs. 74,39,824/- on account of seized cash in thehands of the assessee, apart from the seized gold of1920.55 grams in the custody of the department. It isto be noted that, there is still an outstanding demandof Rs. 1,23,03,650/-, after adjusted of cash seizedinhis hands, pending payable in the hands of theassessee's son Sri. Anoop Kumar S. As on date, thereare no assets of son Anoop Kumar S as a securityagainst the demand pending. The wife of theassesseee, Smt. K. Kumari and his another son Sri. ArunKumar in whose cases also assessments were completedand cash seized, has given consent for adjustment oftheir excess cash still available with the departmentafter adjustment of their respective tax liability. Evenif this adjustment is carried out, there would still ademand of Rs. 66,77,671/- pending in the hands of Sri. Anoop Kumar S, the son of the assessee.” Anoop Kumar S, the son of the assessee.” The learned standing counsel for the respondent also brought it tothe notice of this Court that the claim of the petitioner to return theamount and jewellery is not correct, more so in view of the decisionrendered by this Court in Sree Balaji Refinery Vs. DeputyCommissioner of Income Tax [2012 (2) KLT 196]. 4. The petitioner has sought to file a reply affidavit as well.In the course of further proceedings, the petitioner sought toimplead the Commissioner of Income Tax (Appeals) - II by filingI.A. No. 3861 of 2013, producing copy of the relevant appeals filedas Ext. P6 series (along with I.A. No. 3860 of 2014). Both the I.Asstand allowed by way of separate order passed today. The learnedcounsel for the petitioner submits that the petitioner will besatisfied, if a direction is given to the addl. 3[rd] respondent toconsider and pass appropriate orders Ext. P6 series appeal. 5. After hearing the learned counsel for the petitioner as wellthe learned standing counsel for the respondents, the writ petitionis disposed of, directing the addl. 3[rd] respondent to consider andpass appropriate orders of Ext. P6 series appeals, in accordancewith law, after giving an opportunity of hearing to the petitioner, asexpeditiously as possible. Return of the balance cash, if any, and jewellery and satisfaction of further amount if any from the part ofthe petitioner will depend upon the outcome of the orders to bepassed on Ext. P6 series appeal. Petitioner shall produce a copy of this judgment along withcopy of the writ petition and relevant I.As. before the addl. 3[rd]respondent for further steps. Sd/- kmd P. R. RAMACHANDRA MENON, (JUDGE)