HAILSTONE INNOVATIONS PVT. LTD. V. THE ASSISTANT COMMISSIONER OF INCOME TAX,

WP(C)/17640/2023

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The case involves Hailstone Innovations Pvt. Ltd. and its Managing Director, Mr. R.J. Williams, who filed a writ petition against the Assistant Commissioner of Income Tax and other respondents. The petitioners sought a direction for the third respondent to hear and pass orders on their settlement application, which was acknowledged but later faced delays and issues of maintainability under the Income Tax Act, 1961. The petitioners had previously challenged the discontinuation of the Settlement Commission, which was directed to accept their application by a prior court order. The main legal contention arose from the application of Section 153A of the Income Tax Act concerning the timing and maintainability of their settlement application.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 748742 (HC-KERALA)
• Appeal Type: Others
• Pronouncement Date: 15-06-2023
• Assessment Year: misc
• Other Referred Cases: W.P(C)No.13044/2021
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: JOSE JOSEPH
• Assessee Lawyers: ANIL NAIR; TELMA RAJU; ANJANA; AADITYA NAIR
• Keywords: Income Tax; Maintainability; Settlement commission; Writ petition
• Section: 132; 153A

Judgement Text

"IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE C.S.DIAS THURSDAY, THE 15TH DAY OF JUNE 2023 / 25TH JYAISHTA, 1945 WP(C) NO. 17640 OF 2023 PETITIONERS: 1 HAILSTONE INNOVATIONS PVT. LTD. DOOR NO. 4/381 B, AYYANKUNNU PO MUNDUR, THRISSUR, KERALA. PIN- 680 541. REPRESENTED BY ITS MANAGING DIRECTOR MR. R.J. WILLIAMS 2 R.J. WILLIAMS, AGED 49 YEARS VELLOTTINGAL HOUSE, ANTONY ROAD, OLLUR, THRISSUR, KERALA – 680306. BY ADVS. ANIL D. NAIR TELMA RAJU ANJANA A. AADITYA NAIR RESPONDENTS: 1 THE ASSISTANT COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE 1,KANDOMKULATHY TOWERS INCOME TAX OFFICE OPPOSITE MAHARAJAS COLLEGE GROUND KOCHI-682 001. 2 UNION OF INDIA, REPRESENTED BY ITS SECRETARY DEPARTMENT OF REVENUE, MINISTRY OF FINANCE NORTH BLOCK, NEW DELHI- 110001, PIN - 110001 3 INTERIM BOARD FOR SETTLEMENT, IBS-2, DELHI CIVIC CENTRE MINTO ROAD, NEW DELHI- 110002, PIN - 110002 BY ADV JOSE JOSEPH THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 15.06.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C) NO. 17640 OF 2023 2 Dated this the 15th day of June, 2023 JUDGMENT The writ petition is filed, inter alia, to direct the 3rd respondent to hear and pass orders on an application submitted by the first petitioner as acknowledged by Ext.P3. 2. The first petitioner is a company and the second petitioner is the Managing Director of the first petitioner. A proceeding was initiated by the respondents against the petitioners under Section 132 of the Income Tax Act, 1961. The petitioners were advised to opt for settlement by approaching the Settlement Commission. The petitioners came to learn that a decision was taken to discontinue the Commission. The petitioners challenged the decision before this Court. By Ext.P2 order, this Court directed the second respondent therein to accept the petitioners application. WP(C) NO. 17640 OF 2023 3 Accordingly, petitioners filed an application, as evidenced by Ext.P3 acknowledgment. Later, the Bill to discontinue the Commission was made an Act, which also has been challenged before this Court in W.P(C)No.13044/2021 and is pending consideration. Thereafter, the second respondent has issued Ext.P5 order, extending the time limit for filing of application before the Commission till 30.9.2021. Subsequently, by Ext.P6 notification, the second respondent had extended the period from completion of assessment till 30.9.2021. The proceedings got extended by virtue of the above orders passed. Now, the petitioners are being held responsible for the delay in initiation of the proceedings under Section 153A. The third respondent was pleased to post the settlement application for hearing on 16.5.2023. During the course of hearing, the third respondent has observed that the application is not maintainable in law. The stand of the third respondent WP(C) NO. 17640 OF 2023 4 is untenable. Hence, the writ petition. 3. Heard; Sri. Anil. D. Nair, the learned Counsel appearing for the petitioners and Sri.Jose Joseph, the learned Standing Counsel appearing for the respondents. 4. Sri. Jose Joseph, on instructions, submitted that the third respondent has heard the petitioners and would consider the question of maintainability of the application as a preliminary issue. The third respondent would take decision on the application within four weeks from today. The said submission is recorded. Having considered the pleadings and materials on record and in the light of the submission made by the learned Standing Counsel, I direct the third respondent to consider and dispose of the application, in accordance with law and as expeditiously as possible, at any rate, within a period of one month from the date of receipt of a certified copy of the judgment. I make it clear that WP(C) NO. 17640 OF 2023 5 this Court has not expressed anything on the merits of the application. The writ petition is ordered accordingly. SD/- rmm19/6/2023 C.S.DIAS, JUDGE WP(C) NO. 17640 OF 2023 6 APPENDIX OF WP(C) 17640/2023 PETITIONER EXHIBITS Exhibit P1 TRUE COPY OF THE PANCHNAMA DATED 23.03.2020 Exhibit P2 TRUE COPY OF ORDER DATED 05.03.2021 IN WRIT PETITION NO. 5737 OF 2021. Exhibit P3 TRUE COPY OF ACKNOWLEDGMENT DATED 22.03.2021 OF RECEIPT OF SETTLEMENT APPLICATION FILED BY THE PETITIONER BEFORE THE INCOME TAX SETTLEMENT COMMISSION. Exhibit P4 TRUE COPY OF THE INTIMATION IN FORM NO.34BA FILED BEFORE THE 1ST RESPONDENT ON 22.03.2021 Exhibit P5 TRUE COPY OF NOTIFICATION NO.F.NO.299/22/2021 DATED 28.9.2021- DIRECTOR(INV .III)/174. Exhibit P6 TRUE COPY OF NOTIFICATION NO.10/2021 DATED 27.2.2021 ISSUED BY THE 2ND RESPONDENT. Exhibit P7 TRUE COPY OF RULE 9 REPORT FILED BY THE PRINCIPAL COMMISSIONER OF INCOME TAX CENTRAL CIRCLE. Exhibit P8 TRUE COPY OF THE REPLY FILED BY THE PETITIONER DATED 09.07.2022 TO RULE 9A REPORT. Exhibit P9 TRUE COPY OF POSTING NOTICE ISSUED BY THE 3RD RESPONDENT "