GUJARAT STATE LAND DEVELOPMENT CORPORATION LTD V. DEPUTY COMMISSIONER OF INCOME TAX

SCA/5003/2015

AI Insights

The case involves Gujarat State Land Development Corporation Ltd., a state government undertaking, which filed petitions against the Deputy Commissioner of Income Tax concerning assessment orders for three different assessment years. The primary issue was the rejection of the petitioner's proposal to not be treated as an assessee in default for not paying 25% of the outstanding consolidated demand for the three years, which was rejected by the Assessing Officer on procedural grounds. The petitioner argued that the additions made by the Assessing Officer were not sustainable and had been previously concluded in their favor by higher courts. The respondent did not oppose the relief sought by the petitioner, given the circumstances of the case.

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 694071 (HC-GUJARAT)
• Appeal Type: Others
• Pronouncement Date: 28-04-2015
• Assessment Year: misc
• Other Referred Cases: GSPC Gas Company Ltd. Vs. Deputy Commissioner of Income Tax
• Laws Referred To: Income Tax Act
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: S UDHIR M EHTA
• Assessee Lawyers: S N SOPARKAR; B S SOPARKAR
• Keywords: Appeal; Assessment Order; CIT(A); Default; Income Tax; Recovery
• Section: 147; 143(3); 254; 156

Judgement Text

"C/SCA/5003/2015 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD SPECIAL CIVIL APPLICATION NO. 5003 of 2015 With SPECIAL CIVIL APPLICATION NO. 5004 of 2015 With SPECIAL CIVIL APPLICATION NO. 5008 of 2015 FOR APPROVAL AND SIGNATURE: HONOURABLE MR.JUSTICE M.R. SHAH and HONOURABLE MR.JUSTICE S.H.VORA ====================================== 1 Whether Reporters of Local Papers may be allowed to see the judgment ? 2 To be referred to the Reporter or not ? 3 Whether their Lordships wish to see the fair copy of the judgment ? 4 Whether this case involves a substantial question of law as to the interpretation of the Constitution of India or any order made thereunder ? ====================================== GUJARAT STATE LAND DEVELOPMENT CORPORATION LTD....Petitioner(s) Versus DEPUTY COMMISSIONER OF INCOME TAX....Respondent(s) ====================================== Appearance: MR SN SOPARKAR, SR. ADVOCATE with MR B S SOPARKAR, ADVOCATE for the Petitioner(s) No. 1 MR SUDHIR M MEHTA, ADVOCATE for the Respondent(s) No. 1 ====================================== CORAM: HONOURABLE MR.JUSTICE M.R. SHAH and HONOURABLE MR.JUSTICE S.H.VORA Page 1 of 6 C/SCA/5003/2015 JUDGMENT Date : 28/04/2015 ORAL JUDGMENT (PER : HONOURABLE MR.JUSTICE M.R. SHAH) [1.0] As common question of law and facts arise in all these petitions and as such the dispute is with respect to the same assessee but with respect to different Assessment Years, all these petitions are decided and disposed of by this common judgment and order. [2.0] In all these petitions the common petitioner- assessee, a State Government undertaking, has prayed for an appropriate writ, order or direction to quash and set aside the impugned orders dated 13/03/2015 by which during pendency of the respective appeals before the learned CIT(A) against the Assessment Orders for the Assessment Years 2008-09, 2009-10 and 2012-13, the proposal of the petitioner not to treat the petitioner-assessee as assessee in default on payment of 25% of the outstanding consolidated demand for all the three Assessment Years has been rejected and consequently treating the petitioner as assessee in default and threatening the action of recovery. [3.0] At the outset, it is required to be noted that while passing the respective assessment orders for the Assessment Years 2008-09, 2009-10 and 2012-13, the concerned Assessing Officer has raised the demand on account of following additions; Page 2 of 6 C/SCA/5003/2015 JUDGMENT A.Y. 2008-09 2009-10 2012-13 Assessment order passed under Section 143(3) r.w.s. 254 143(3) r.w.s.147 143(3) Additions 1. National interest income on farmers loan 4,24,99,693 - 7,51,87,000 2. Waiver of interest and principal on farmers loan / bad debts - 20,55,16,233 - 3. Gratuity Premium - 1,26,00,819 - Total Additions 4,24,99,693 21,81,17,052 7,51,87,000 Demand 2,46,87,609 11,84,29,186 3,30,09,740 [3.1] Feeling aggrieved and dissatisfied with the aforesaid assessment orders, more particularly, the additions as above, the petitioner preferred appeals before the learned CIT(A), which are pending before the learned CIT(A). In the meantime, the petitioner-assessee was served with the notices / demand notices under Section 156 of the Income Tax Act dated 28/01/2015 and, therefore, the petitioner-assessee approached the Assessing Officer and made a proposal that on payment of 25% of the outstanding consolidated demand for all the three Assessment Years within 15 days, the petitioner- assessee may not be treated as assessee in default. It appears that the Assessing Officer-Deputy Commissioner of Income Tax, Gandhinagar Circle, Gandhinagar called the petitioner- assessee / its representative for personal hearing on the aforesaid proposal. However, in the meantime, the 15 days, which was proposed by the petitioner-assessee had expired and, therefore, the Assessing Officer has rejected the said proposal and has observed that on payment of the entire amount of demand raised pursuant to the assessment orders, the petitioner-assessee shall be treated as assessee in default and appropriate action of recovery shall be taken. At that stage and feeling aggrieved and dissatisfied with the aforesaid Page 3 of 6 C/SCA/5003/2015 JUDGMENT communication dated 13/03/2015, the petitioner-assessee has preferred the present Special Civil Applications under Article 226 of the Constitution of India. [4.0] Shri Soparkar, learned Counsel appearing on behalf of the petitioner-assessee has vehemently submitted that the issues / additions made by the Assessing Officer are squarely covered in favour of the assessee in view of the decision of the Hon’ble Supreme Court as well as this Court and the said issue has been concluded in favour of the assessee. It is submitted that therefore the additions made by the Assessing Officer are not sustainable at law at all. It is further submitted that the petitioner-assessee made a proposal before the Assessing Officer and proposed to deposit 25% of the consolidated amount with respect to the aforesaid three Assessment Years within a period of 15 days and on deposit of the said amount, the petitioner may not be treated as assessee in default. However, despite the fact that the personal hearing was given by the Assessing Officer, the impugned communication has been sent stating that the proposal is not accepted solely on the ground that the 15 days time proposed by the petitioner- assessee has expired. It is submitted that in any case now pursuant to the interim order passed by this Court, the petitioner-assessee had already deposited 50% of the amount as per the demand notice and, therefore, it is requested to quash and set aside the impugned communication on deposit of the aforesaid amount (which is already deposited) and the petitioner may not be treated as assessee in default during pendency and final disposal of the appeals before the learned CIT(A). Page 4 of 6 C/SCA/5003/2015 JUDGMENT [4.1] Shri Soparkar, learned Counsel appearing on behalf of the petitioner-assessee has heavily relied upon the decision of the Division Bench of this Court in the case of GSPC Gas Company Ltd. Vs. Deputy Commissioner of Income Tax rendered in Special Civil Application No.14746/2013 and allied Special Civil Applications in support of his above prayer. [5.0] Shri Sudhir Mehta, learned advocate appearing on behalf of the respondent has tried to oppose the present Special Civil Applications but has failed. He has fairly stated at the bar that now as the petitioner-assessee has deposited 50% of the amount he does not invite any further reasoned order and if it is ordered that on payment of 50% of the amount, which the petitioner has already deposited during pendency and final disposal of the appeals before the learned CIT(A), the petitioner may not be treated as assessee in default, he does not have any objection. However, has requested to make suitable observation that the learned CIT(A) to decide and dispose of the appeals on merits in accordance with law and without, in any way, being influenced by the present order. [6.0] In view of the aforesaid facts and circumstances of the case and without expressing anything on merits, more particularly, the submissions of Shri Soparkar, learned Counsel appearing on behalf of the petitioner-assessee that the issues are already concluded in favour of the petitioner-assessee by the decision of the Hon’ble Supreme Court and considering the decision of this Court in the case of GSPC Gas Company Ltd. (supra) and without expressing anything on merits with respect to the additions made by the Assessing Officer, as the Page 5 of 6 C/SCA/5003/2015 JUDGMENT petitioner had already deposited 50% of the tax demand as per the notices of demand for all the three Assessment Years, in the facts and circumstances of the case, we direct that during pendency and final disposal of the respective appeals before the learned CIT(A) against the assessment orders for the Assessment Years 2008-09, 2009-10 and 2012-13, the petitioner may not be treated as assessee in default. The learned CIT(A) to decide and dispose of the respective appeals in accordance with law and on its own merits without, in any way, being influenced by the present order expeditiously. With this, all the petitions are disposed of. (M.R.SHAH, J.) (S.H.VORA, J.) Siji Page 6 of 6 "