CARMELITE MEDICAL CENTRE V. THE COMMISSIONER OF INCOME-TAX

WP(C)/34306/2022

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The case involves Carmel Medical Centre, a charitable trust, which approached the High Court of Kerala seeking relief against a demand for payment of Income Tax raised through an intimation under Section 143(1) of the Income Tax Act, 1961. The petitioner argued that they are entitled to exemption under Section 12A of the Income Tax Act, 1961, and that the denial of exemption was due to a delay in filing the audit report in Form 10B. The application for condonation of this delay was pending before the 3rd respondent. The court's decision focused on ensuring that the petitioner's case for exemption was heard before any tax demands were enforced.

• Counselvise Citation: [2022] 140 COUNSELVISE.COM (IT) 726182 (HC-KERALA)
• Appeal Type: Others
• Pronouncement Date: 28-10-2022
• Assessment Year: misc
• Other Referred Cases: WPC 31513/2022
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Applicant
• Court: HIGH COURT
• Department Lawyers: CHRISTOPHER ABRAHAM
• Assessee Lawyers: NITISH SHENOY; SHERRY OOMMEN
• Keywords: Audit report; Charitable Trust; Condonation of delay; Exemption; Income Tax
• Section: 143(1); 12A

Judgement Text

"IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE GOPINATH P. FRIDAY, THE 28TH DAY OF OCTOBER 2022 / 6TH KARTHIKA, 1944 WP(C) NO. 34306 OF 2022 PETITIONER: CARMEL MEDICAL CENTRE, KIZHATHADIYOOR P.O, PALAI, KOTTAYAM, KERALA - 686574, REPRESENTED BY ITS ADMINISTRATOR, SISTER SILVIN. BY ADVS. NITISH SATHESH SHENOY SHERRY SAMUEL OOMMEN RESPONDENTS: 1 THE COMMISSIONER OF INCOME-TAX, PUBLIC LIBRARY BUILDINGS, SASHTRY ROAD, KOTTAYAM – 686 001. 2 THE ASSISTANT DIRECTOR OF INCOME-TAX, CPC, BANGALORE, PIN – 560 050. 3 THE COMMISSIONER OF INCOME-TAX (EXEMPTION) SAN JUAN TOWERS, 2 ND FLOOR, BEHIND CR BUILDING OLD RAILWAY STATION ROAD, KOCHI – 682 018. ADV. CHRISTOPHER ABRAHAM (SC) THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 28.10.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C) NO. 34306 OF 2022 2 JUDGMENT Petitioner has approached this court, being aggrieved by the fact that a demand for payment of Income Tax has been raised on the petitioner through Ext.P3 intimation under Section 143(1) of the Income Tax Act, 1961. 2. Learned counsel appearing for the petitioner submits that the petitioner is a Charitable Trust, entitled to exemption under Section 12A of the Income Tax Act, 1961. It is submitted that the reason for denial of exemption, for the year in question, is on account of the fact that there was a delay in filing audit report in Form 10B of the Income Tax Rules. It is submitted that the petitioner has filed Ext.P4 application for condonation of delay in filing the audit report in Form 10B of the Rules, before the 3rd respondent and the same is pending consideration before the 3rd respondent. It is submitted that if the demands in Ext.P3 are sought to be enforced, pending consideration of the matter by the 3rd respondent, the petitioner will be put to serious prejudice, injury and hardship. 3. Learned counsel appearing for the respondent Department submits that the 3rd respondent will consider and WP(C) NO. 34306 OF 2022 3 pass orders on Ext.P4, after affording an opportunity of hearing to the petitioner, within a period of three months from the date of receipt of a certified copy of this judgment. 4. Having heard the learned counsel appearing for the petitioner and the learned Standing Counsel appearing for the respondent Department, this writ petition is disposed of, directing the 3rd respondent to consider and pass orders on Ext.P4, within a period of three months from the date of receipt of a certified copy of this judgment, after affording an opportunity of hearing to the petitioner. Till such time as orders are passed on Ext.P4, any demand pursuant to Ext.P3 shall be kept in abeyance. The writ petition is disposed of as above. Sd/- GOPINATH P. JUDGE DK WP(C) NO. 34306 OF 2022 4 APPENDIX OF WP(C) 34306/2022 PETITIONER EXHIBITS Exhibit1 A TRUE COPY OF THE APPROVAL GRANTED UNDER SECTION 12A OF THE ACT DATED 12.7.2005 Exhibit P2 A TRUE OF ACKNOWLEDGMENT PAGE OF THE INCOME-TAX RETURN FILED BY THE PETITIONER FOR AY 2020- 21 ON 24.01.2021 VIDE ACKNOWLEDGEMENT RECEIPT NUMBER 225617400240121. Exhibit P3 A TRUE COPY OF THE INTIMATION UNDER SECTION 143(1) OF THE ACT DATED 24.12.2021 ISSUED BY THE 2 ND RESPONDENT Exhibit P4 A TRUE COPY OF THE APPLICATION DATED 22.02.2022 SEEKING CONDONATION OF DELAY PENDING CONSIDERATION OF THE 3 RD RESPONDENT Exhibit P5(A) A TRUE COPY OF THE CERTIFICATE DATED 23.02.2022 ISSUED BY THE PETITIONER'S CHARTERED ACCOUNTANT. Exhibit P5(B) TRUE COPY OF THE REQUEST LETTER DATED 15.03.2022 SEEKING EARLY DISPOSAL / URGENT HEARING OF THE CONDONATION APPLICATION Exhibit P6 A TRUE COPY OF CIRCULAR NO 2/2020 DATED 03.01.2020 Exhibit P7 A TRUE COPY OF CIRCULAR NO 267/482/77-IT DATED 09.02.1978 Exhibit P8 A TRUE COPY OF CIRCULAR NO 10 [F.NO.197/55/2018-ITA-I] DATED 26.03.2021 Exhibit P9 A TRUE COPY OF THE JUDGMENT OF THIS HON'BLE COURT IN WPC 31513/2022 DATED 10.10.2022 REPORTED IN 2022-VIL-227-KER- DT "