Haryana State Co-operative Supply & Marketing Federation Ltd., Panchkula V. Commissioner of Income Tax, Panchkula and another

CWP/4345/2008

AI Insights

The case involves the Haryana State Co-operative Supply & Marketing Federation Ltd., which filed a writ petition against the Commissioner of Income Tax, Panchkula, challenging a notice for recovery of additional demand based on an assessment order. The petitioner had claimed an exemption for rent of godowns under Section 80P(2)(e) of the Income Tax Act, 1961, which was disallowed by the Assessing Officer. The petitioner argued that a similar claim had been allowed in a previous assessment year and was upheld in appeal. The petition was filed to prevent the recovery of the disputed demand during the pendency of the first appeal, citing a relevant CBDT circular that supports such a stay in similar circumstances.

• Counselvise Citation: [2008] 140 COUNSELVISE.COM (IT) 797405 (HC-CHANDIGARH)
• Appeal Type: Others
• Pronouncement Date: 24-03-2008
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: YOGESH PUTNEY
• Assessee Lawyers: RAJESH GARG
• Keywords: Appeal; Assessment Order; Disputed Demand; Exemption; Income Tax; Mandamus; Writ petition
• Section: 143(3); 119; 226; 80P(2)(e); 227

Judgement Text

"IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH. C.W.P. No. 4345 of 2008 DATE OF DECISION : 24.03.2008 Haryana State Co-operative Supply & Marketing Federation Ltd., Panchkula .... PETITIONER Versus Commissioner of Income Tax, Panchkula and another ..... RESPONDENTS CORAM :- HON'BLE MR. JUSTICE SATISH KUMAR MITTAL HON'BLE MR. JUSTICE RAKESH KUMAR GARG Present: Mr. Rajesh Garg, Advocate, for the petitioner. Mr. Yogesh Putney, Advocate, for the respondents. * * * SATISH KUMAR MITTAL , J. The petitioner has filed this writ petition under Articles 226/227 of the Constitution of India for setting aside the notice dated 18.2.2008 (Annexure P-3), issued by the Assessing Officer, respondent No.2 herein, for recovery of the additional demand in terms of the assessment order dated 24.12.2007 (Annexure P-1) passed by him; and further for issuance of a writ in the nature of mandamus directing respondent No.2 not to recover the disputed demand during the pendency of the first appeal filed by the petitioner. CWP No. 4345 of 2008 -2- In the present case, the petitioner filed return of its income for the assessment year 2005-06, in which it claimed exemption under Sections 80P (2) (e) of the Income Tax Act, 1961 (hereinafter referred to as `the Act') being rent of the godowns. The Assessing Officer, while framing the assessment under Section 143 (3) of the Act, disallowed the exemption, claimed by the petitioner. It is the case of the petitioner that in the earlier assessment year, the similar claim made by it was allowed and the said order was upheld in appeal. It is the further case of the petitioner that against the assessment order, it has already filed an appeal before the Commissioner of Income Tax (Appeals) [hereinafter referred to as `the CIT (A)], which is pending. Therefore, the petitioner moved application before the Assessing Officer for keeping the disputed demand in abeyance, in view of the Circular No. 530 dated 6.3.1989, passed by the Central Board of Direct Taxes under Section 119 of the Act. The Assessing Officer, without considering the prayer and by ignoring the aforesaid Circular, asked the petitioner to deposit the disputed amount of additional demand. In that situation, the petitioner has filed the instant petition. We have heard counsel for the parties. Undisputedly, the appeal filed by the petitioner against the assessment order is still pending. It has also not been disputed by counsel for the respondents-revenue that for the earlier assessment year of the petitioner-assessee, the Income Tax Appellate Tribunal has decided the CWP No. 4345 of 2008 -3- similar issue in favour of the assessee. In view of the aforesaid admitted position as well as the Circular No. 530 dated 6.3.1989, which provides that where the demand in dispute relates to issues that have been decided in favour of the assessee in an earlier year by an appeallate authority or court in assessee's own case, the assessee shall not be treated in default in respect of amount attributable to such disputed points so long as such appeal remains un-disposed of, we deem it appropriate that till the disposal of the appeal of the petitioner by the CIT (A), respondent No.2 will keep the disputed amount in abeyance. However, we further direct the CIT (A) to dispose of the appeal filed by the petitioner, within a period of two months. Petition stands disposed of accordingly. ( SATISH KUMAR MITTAL ) JUDGE March 24, 2008 ( RAKESH KUMAR GARG ) ndj JUDGE "