M/S.HEERA CONSTRUCTION COMPANY PVT. LTD. V. THE ASSISTANT COMMISSIONER OF INCOME TAX (TDS)

WP(C)/37338/2016

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Heera Construction Company Pvt. Ltd. filed a writ petition against the Income Tax Department's action of attaching their bank accounts for non-payment of alleged tax dues amounting to Rs.2,30,32,871. The petitioner contested the figures provided by the Department, claiming discrepancies and stating that only Rs.16,14,180 was actually due. The court heard arguments from both sides and decided to pause the bank account attachments, directing the Income Tax Department to reconcile the accounts and determine the final payable amount after considering the petitioner's objections.

• Counselvise Citation: [2016] 140 COUNSELVISE.COM (IT) 699552 (HC-KERALA)
• Appeal Type: Others
• Pronouncement Date: 22-11-2016
• Assessment Year: misc
• Result in Favour of: Partly Allowed
• Court: HIGH COURT
• Department Lawyers: K M V PANDALAI; R S KALKURA; JAWAHAR JOSE
• Assessee Lawyers: T M SREEDHARAN
• Keywords: Bank Account Attachment; Financial Reconciliation; Income Tax; TDS Arrears
• Section: 226(3)

Judgement Text

"IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR.JUSTICE A.M.SHAFFIQUE TUESDAY, THE 22ND DAY OF NOVEMBER 2016/1ST AGRAHAYANA, 1938 WP(C).No. 37338 of 2016 (N) ---------------------------- PETITIONER: ------------------- M/S.HEERA CONSTRUCTION COMPANY PVT. LTD., HEERA PARK, M.P.APPAN ROAD, VAZHUTHACAUD, THIRUVANANTHAPURAM-695 014, REPRESENTED BY ITS MANAGING DIRECTOR, SHRI.A.ABDUL RASHEED. BY SRI.T.M.SREEDHARAN,SENIOR ADVOCATE ADVS. SRI.V.P.NARAYANAN SMT.VANDANA MENON SMT.DIVYA RAVINDRAN SRI.ABRAHAM VARGHESE THARAKAN SMT.MERLIN MANSY RESPONDENTS: ------------------------- 1. THE ASSISTANT COMMISSIONER OF INCOME TAX (TDS), 3RD FLOOR, AAYAKAR BHAVAN, KAWDIAR, THIRUVANANTHAPURAM-695 003. 2. THE BRANCH MANAGER, STATE BANK OF INDIA,COMMERCIAL BRANCH, THYCAUD, THIRUVANANTHAPURAM-695 015. 3. THE BRANCH MANAGER, STATE BANK OF TRAVANCORE, KOWDIAR BRANCH, KOWDIAR,THIRUVANANTHAPURAM-695 004. R1 BY SRI.K.M.V.P ANDALAI, INCOME TAX DEPARTMENT R2 BY SRI.R.S.KALKURA, SC, SBI R3 BY ADV. SRI.JAWAHAR JOSE, STATE BANK OF TRAVANCORE THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 22-11-2016, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: sts WP(C).No. 37338 of 2016 (N) ----------------------------------------- APPENDIX PETITIONER(S)' EXHIBITS --------------------------------------- EXHIBIT P1 TRUE COPY OF LETTER DATED 2.11.2016 SHOWING ARREARS AS RS.2,30,32,871 ISSUED BY THE FIRST RESPONDENT EXHIBIT P1(A) TRUE COPY OF THE STATEMENT SHOWN AS \"TRACES/FORM 26AS\" SHOWING ARREARS RS.1,27,73,315/-TAKEN FROM THE SYSTEM OF IT DEPARTMENT EXHIBIT P1(B) TRUE COPY OF STATEMENT OF TDS DEDUCTED AND STATEMENT OF TDS BALANCE PAYABLE SHOWING THE ARREARS AS RS.16,14,810/- TAKEN FROM THE SYSTEM OF IT DEPARTMENT EXHIBIT P2 TRUE COPY OF NOTICE ISSUED U/S.226(3)DATED 4.11.2016 TO THE 2ND RESPONDENT EXHIBIT P3 TRUE COPY OF THE NOTICE ISSUED U/S.226(3)DATED 4.11.2016 TO THE 3RD RESPONDENT EXHIBIT P4 TRUE COPY OF LETTER DATED 10.11.2016 SUBMITTED BY THE PETITIONER TO THE 1ST RESPONDENT EXHIBIT P5 TRUE COPY OF THE REPRESENTATION DATED 17.11.2016 SUBMITTED BEFORE THE 1ST RESPONDENT. RESPONDENT(S)' EXHIBITS: NIL ----------------------------------------- /TRUE COPY/ P.A.TO JUDGE sts A.M. SHAFFIQUE, J. ------------------------------------- W.P.(C) No. 37338 of 2016 -------------------------------------- Dated this the 22nd day of November, 2016 JUDGMENT Petitioner has approached this Court when proceedings had been initiated by the Income Tax Department, attaching the bank account of the petitioner by issuance of Exts.P2 and P3. By Exts.P2 and P3, the Banks are directed to pay an amount of Rs.2,30,32,871/- to the Income Tax Department. According to the petitioner, demand had been made as per Ext.P1 and the petitioner was called upon to appear on 8.11.2016 and submit their objection as to why the demand could not be made final. Petitioner submitted Ext.P5 reply inter alia stating that the figures shown by the Department does not reconcile with the accounts available with the petitioner. According to them, during the various financial years, petitioner has deposited various amounts and the net amount payable is only Rs.16,14,180/-. According to the petitioner, they require reconciling of the accounts in order to W.P.(C) No. 37338 of 2016 -2- arrive at a final figure and until such time, it was not proper on the part of the Income Tax Department to have stopped the banking operation to the petitioners in terms of Exts.P2 and P3. 2. Learned Standing Counsel appearing on behalf of the respondent however supports the aforesaid action on behalf of the Department. It is stated that the entire accounts were available with the department and whatever amounts had been paid is duly credited. Since substantial amount is payable, the attachment orders had been issued. Having heard the learned counsel on either side and having perused the records, I am of the view that it will be appropriate to direct the Assistant Commissioner of the Income Tax viz; the first respondent herein to consider Ext.P5 and arrive at a final amount regarding the amount to be paid by the petitioner, after hearing the petitioner. Until such time, there will be a direction to keep in abeyance Exts.P2 and P3 on condition that the petitioner remits the admitted amount of W.P.(C) No. 37338 of 2016 -3- Rs.16,14,180/- (Rupees Sixteen Lakh Fourteen Thousand One Eighty Only) within a period of one month from the date of receipt of a copy of this judgment. Sd/- A.M. SHAFFIQUE JUDGE Scl/22.11.2016 "