L.SELVAN V. THE INCOME TAX OFFICER

WA/340/2018

AI Insights

The case involves L. Selvan Kochu Maveli Veedu, a contractor and income tax assessee, who appealed against the judgment of the learned Single Judge requiring him to pay 30% of the tax demand to stay recovery proceedings. The petitioner had initially been required to pay 75% of the demand, which was later modified to 30% by the Single Judge. The petitioner argued that according to Ext.P8, only 20% should be required. However, the court found that the petitioner had not approached the Assessing Officer timely for a modification of the payment percentage and had engaged in practices that suggested tax evasion, such as using multiple PAN cards and accounts to segregate income.

• Counselvise Citation: [2018] 140 COUNSELVISE.COM (IT) 697416 (HC-KERALA)
• Appeal Type: Others
• Pronouncement Date: 08-02-2018
• Assessment Year: misc
• Laws Referred To: Ext.P8
• Result in Favour of: Revenue
• Court: HIGH COURT
• Department Lawyers: CHRISTOPHER ABRAHAM
• Assessee Lawyers: B ASHOK SHENOY; K V GEORGE
• Keywords: Assessment; Income Tax; Multiple PANs; Stay of recovery; Tax Evasion
• Section: 143(3)

Judgement Text

"IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR.JUSTICE K.VINOD CHANDRAN & THE HONOURABLE MR. JUSTICE ASHOK MENON THURSDAY, THE 8TH DAY OF FEBRUARY 2018 / 19TH MAGHA, 1939 WA.No. 340 of 2018 IN WPC. 39523/2017 AGAINST THE JUDGMENT IN WP(C) NO.39523/2017 OF THE HIGH COURT OF KERALA DATED 20.12.2017 APPELLANT/PETITIONER: L. SELVAN KOCHU MAVELI VEEDU TC 48/937, KATTAMALA, THAMALAM, POOJAPURA P.O. THIRUVANANTHAPURAM. BY ADVS.SRI.B. ASHOK SHENOY SRI.K.V. GEORGE RESPONDENTS/RESPONDENTS: 1. THE INCOME TAX OFFICER WARD 1(3), THIRUVANANTHAPURAM - 695 001. 2. THE COMMISSIONER OF INCOME TAX (APPEALS) THIRUVANANTHAPURAM - 695 001. BY SRI.CHRISTOPHER ABRAHAM, INCOME TAX DEPARTMENT THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 08-02-2018, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: K. VINOD CHANDRAN & ASHOK MENON, JJ. ---------------------------------- W.A. No.340 of 2018 ---------------------------------- Dated this the 8th day of February, 2018 JUDGMENT K. Vinod Chandran, J. The petitioner is aggrieved with the judgment of the learned Single Judge and seeks further reduction in the amounts directed to be paid so as to keep the recovery in abeyance. The petitioner is a Contractor and is an assessee to income tax on the rolls of the 1st respondent. The petitioner's assessment for the year 2013 was completed determining the total income and imposing a tax of Rs.50,39,150/-. 2. The petitioner filed an appeal before the CIT[Appeals], in which there was a stay granted of the recovery on the petitioner paying 75% of the total demand. The petitioner was before this Court W.A. No.340 of 2018 2 and the learned Single Judge modified the stay order directing the petitioner to pay 30% of the demand within one month. The petitioner is before this Court challenging the said judgment and relying on Ext.P8, which mandates stay by the Assessing Officer to the extent of 20% [as modified now] and seeking the recovery to be kept in abeyance on payment of 20% of the total demand. 3. The learned Standing Counsel for the Department submits that Ext.P8 is a Circular directing the Assessing Officer to exercise discretion in so far as granting stay in fit cases by permitting payment of 20% of the amounts, when an appeal is filed before the CIT [Appeals]. The petitioner never approached the Assessing Officer and it is also pointed out that Clause (B)(a) specifies that in appropriate cases the Assessing Officer will be entitled to approach the Principal W.A. No.340 of 2018 3 Commissioner for payment of enhanced percentage of demand. 4. We find that the appellant had not approached the Assessing Officer at the appropriate time. Even if a stay was granted on payment of 20%, the Assessing Officer could have approached the administrative superior for enhancement of the amounts to be paid, to keep the recovery in abeyance. In the present case, the learned Single Judge had looked into that aspect and found that it would be appropriate to keep in abeyance recovery on payment of 30%. We also see that the assessee had taken out two PAN cards and two separate accounts, in which there were contract receipts. The assessee's claim is against the clubbing of both the accounts and the expenditure which could be allowed in the second account. The assessee had taken out two PAN numbers and disclosed his total W.A. No.340 of 2018 4 income segregated in both the PAN numbers and filed returns accordingly. The Assessing Officer found that the assessee had taken out two PAN numbers and distributed his receipts in the two accounts, which definitely leads to evasion of tax. We are of the opinion that there could be no further interference made to the recovery, but we grant the petitioner three instalments, first instalment to be paid on or before 20.02.2018, the second instalment to be paid on or before 20.03.2018 and the third instalment to be paid on or before 20.04.2018. With the aforesaid observation, the above writ appeal would stand disposed of. Sd/- K. VINOD CHANDRAN, JUDGE. Sd/- ASHOK MENON, JUDGE. sp/08/02/18 //True Copy// P.A. To Judge "