EUROTECH MARKETING V. INCOME TAX OFFICER

WP(C)/11134/2020

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The case involves Eurotech Marketing, represented by its managing partner Abdul Rasheed M.C., challenging a conditional stay order imposed by the Commissioner of Income Tax, Kozhikode. The original dispute arose from an assessment order dated 30.11.2018 for the assessment year 2012-2013, against which the petitioner filed an appeal and a stay application. The stay was granted conditionally, requiring a 25% deposit of the assessed amount, which the petitioner contested based on a precedent that set the deposit at 20%. The court, considering the financial impact of the COVID-19 pandemic and the cited precedent, reduced the deposit requirement to 12.5% and set a timeline for the appeal's resolution.

• Counselvise Citation: [2020] 140 COUNSELVISE.COM (IT) 753376 (HC-KERALA)
• Appeal Type: Others
• Pronouncement Date: 08-06-2020
• Assessment Year: misc
• Other Referred Cases: W.A.No.1536/2019
• Laws Referred To: Income Tax Act
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: CHRISTOPHER ABRAHAM
• Assessee Lawyers: R JAIKRISHNA
• Keywords: Assessment Order; Conditional stay; Income Tax; Stay Application
• Section: 226(3)

Judgement Text

"IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE AMIT RAWAL MONDAY, THE 08TH DAY OF JUNE 2020 / 18TH JYAISHTA, 1942 WP(C).No.11134 OF 2020(N) PETITIONER/S: EUROTECH MARKETING CHANGHARAMKULAM, KOKUR P.O., EDAPPAL, MALAPPURAM- 679591, REPRESENTED BY ITS MANAGING PARTNER- ABDUL RASHEED M.C. BY ADV. SRI.R.JAIKRISHNA RESPONDENT/S: 1 INCOME TAX OFFICER WARD NO.IV, OFFICE OF JOINT COMMISSIONER OF INCOME TAX, TIRUR RANGE, TIRUR P.O., MALAPPURAM-676101. 2 COMMISSIONER OF INCOME TAX (APPEALS), OFFICE OF THE COMMISSIONER OF INCOME TAX (APPEALS), KOZHIKODE P.O., KOZHIKODE-673001. OTHER PRESENT: SRI CHRISTOPHER ABRAHAM SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 08.06.2020, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C).No.11134 OF 2020(N) 2 JUDGMENT The petitioner through the instant writ petition has assailed order dated 03.03.2020 (Ext.P3) by the 2nd respondent whereby while entertaining the stay application along with the appeal preferred against the assessment order dated 30.11.2018 for the assessment year 2012-2013 the demand has been stayed subject to the condition of deposit of 25% within a period of six months. Learned counsel appearing on behalf of the petitioner submits that the condition of payment of 25% is not justified in view of the order of the Division Bench of this Court in W.A.No.1536/2019 whereby this Court had directed that while entertaining the application for stay, the condition of 20%, by relying upon the circular on July 2017 cannot be imposed. 2. Issue notice before admission. Sri.Christopher Abraham accepts notice and submits that since the application for stay has already been disposed of, the period of six months has been given for deciding the appeal. But owing to the Covid 19 pandemic the collection or the recovery of the Government due WP(C).No.11134 OF 2020(N) 3 from the tax has become an hardest task and the government is facing financial stringencies. 3. I have heard the learned counsel for the parties and appraised the paper book. 4. No doubt that in the instant case vide Ext.P3 stay application, petitioner has been directed to pay 25% of the total amount on or before 15.03.2020 and the balance amount has been stayed for a period of six months or till the disposal of the appeal whichever is earlier. The order in writ appeal cannot be said to be in knowledge or notice of Commissioner of Income Tax Appeal/the assessing officer while exercising power under Section 226(3) of the Income Tax Act. But despite that such types of orders are passed imposing a condition of payment of 20% or 25%. Be that as it may. The impugned order of stay Ext.P3 is hereby set aside and the 2nd respondent ie., Commissioner of Income Tax, Kozhikode is directed to hear the appeal within a period of six months as prescribed subject to condition that the petitioner would deposit 12.5% within a period of one month from today. In case the petitioner complies with the order, the WP(C).No.11134 OF 2020(N) 4 appeal shall be heard, otherwise the competent authority ie. the Commissioner shall be at liberty to pass any appropriate order in accordance with law. The writ petition stands disposed of. Sd/- AMIT RAWAL JUDGE nak WP(C).No.11134 OF 2020(N) 5 APPENDIX PETITIONER'S/S EXHIBITS: EXHIBIT P1 TRUE COPY OF THE ASSESSMENT ORDER ISSUED BY THE 1ST RESPONDENT DATED 30.11.2018. EXHIBIT P2 TRUE COPY OF THE APPEAL FILED BY THE PETITIONER BEFORE THE 2ND RESPONDENT DATED 22.5.2019. EXHIBIT P2(A) TRUE COPY OF THE STAY PETITION FILED BY THE PETITIONER BEFORE THE 2ND RESPONDENT DATED 28.5.2019. EXHIBIT P2(B) TRUE COPY OF THE DELAY PETITION FILED BY THE PETITIONER BEFORE THE 2ND RESPONDENT DATED 22.5.2019. EXHIBIT P3 TRUE COPY OF THE CONDITIONAL ORDER OF STAY PASSED BY THE 1ST RESPONDENT DATED 3.3.2020. "