Lavu Educational Society V. The Dy. Commissioner of Income Tax, Central Circle-2 and The Commissioner of Income Tax (Appeals-I) and The Branch Manager, UCO Bank

WP/24283/2008

AI Insights

The case involves M/s. Lavu Educational Society, which operates various educational institutions in Andhra Pradesh and sought a writ of mandamus against the Income Tax authorities for attaching its bank account under Section 226(3) of the Income Tax Act, 1961. The petitioner argued that the attachment was illegal, arbitrary, and violated its rights under Article 19(1)(g) of the Constitution of India. The society had previously been granted tax exemptions and was in the process of appealing against certain tax assessments when the bank account was attached. The court did not delve into the merits of the case but focused on ensuring a timely resolution of the pending appeals.

• Counselvise Citation: [2008] 140 COUNSELVISE.COM (IT) 797144 (HC-ANDHRA_PRADESH)
• Appeal Type: Others
• Pronouncement Date: 11-11-2008
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961, Constitution of India
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: B N SARMA
• Assessee Lawyers: C KODANDARAM
• Keywords: Bank Account Attachment; Educational Society; Income Tax; Writ of Mandamus; Charitable Institution Exemption
• Section: 11; 12A; 226(3); 10(23); 10(22)

Judgement Text

"IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) FRIDAY, THE SEVENTH DAY OF NOVEMBER TWO THOUSAND AND EIGHT PRESENT THE HON'BLE MRS JUSTICE T.MEENA KUMARI AND THE HON'BLE MR JUSTICE RAMESH RANGANATHAN WRIT PETITION NO : 24283 of 2008 Between: M/s. Lavu Educational Society, 4/7, Brodipet, Guntur, Rep by its President Dr. L. Rathaiah ..... PETITIONER AND 1 The Dy. Commissioner of Income Tax, Central Circle-2, 7th floor, Aayakar Bhavan, Basheerabagh, Hyderabad. 2 The Commissioner of Income Tax (Appeals-I) Aayakar Bhavan, Basheerabagh, Hyderabad. 3 The Branch Manager, UCO Bank, 9/1, Arundalpet, P.B. No. 206, Guntur - 522 002. .....RESPONDENTS Petition under Article 226 of the constitution of India praying that in the circumstances stated in the Affidavit filed herein the High Court will be pleased to issue order or direction or a wrti more particularly one in the nature of Writ of Mandamus declaring the proceedings in P .A.N./G.I.R.No. AAAA L 0584 H dated 17-10-2008 issued under Section 226 (3) of the Income Tax Act, 1961 by the 1st respondent to the 3rd respondent for the year Assessment Year 2001-2002 by attaching the Bank Account of the petitioner's society is illegal, arbitrary, unreasonable and unjust and violative of the petitioner's rights guaranteed under Article 19 (1) (g) of the constitution of India and pass Counsel for the Petitioner: M/SC.KODANDA RAM Counsel for the Respondent No.: MR.B.N.SARMA The Court made the following : ORAL ORDER: (per THE HON’BLE MRS. JUSTICE T.MEENA KUMARI) Seeking a writ of mandamus declaring the proceedings in PAN/GIR No.AAAA L 0584 H dated 17.10.2008 issued under Sec.226(3) of the Income Tax Act, 1961 by the first respondent to the third respondent for the Assessment Year 2000-01 by attaching the bank account of the petitioner’s Society as illegal, arbitrary and violative of rights guaranteed under Article 19(1)(g) of the Constitution, the petitioner filed this writ petition. The petitioner company is running number of educational institutions including Engineering, Pharmacy and other Post Graduate Courses in the State of Andhra Pradesh and it is exempted from tax under Sec. 10(22) of the Income Tax Act. While so, after introduction of Sec. 10(23) to the Income Tax Act, the petitioner made an application to the CBDT seeking exemption, which is pending. The petitioner also filed an application under Sec. 12A of the Income Tax Act for registration and an application under Sec. 11 seeking exemption, as a charitable institution, which was rejected on 23.1.2001, pending amendment, but after the suggested amendment, it was granted on 9.3.2001. While so, for the assessment year 2000-2001, the petitioner filed returns with nil income claiming exemption under Sec. 11 of the Act, but the Assessing Officer served notices on 23.3.2007 for two years. The petitioner filed detailed objections, in reply. However, the Assessing Officer did not accept the contentions raised by the petitioner and made re- assessments bringing the excess income over expenditure to tax. Aggrieved thereby, the petitioner filed appeals before the second respondent, which are pending. Pending appeals, the petitioner also filed applications seeking stay of the collection of tax, before the first respondent, which was rejected by order dated 21.8.2008. Hence, this writ petition. Heard the learned counsel for the petitioner and the learned Special Standing Counsel for Commercial Taxes. It is submitted by the learned counsel for the petitioner that though several contentions were raised before the first respondent, the first respondent has refused to grant stay and issued notice dated 17.10.2008 to the third respondent Bank for recovery of Rs.2,10,59,495/-. It is further contended by the learned counsel for the petitioner that pending appeals before the Second Respondent, the Bank Accounts of the petitioner are attached and if the appeals are not disposed of expeditiously, irreparable loss and injury would be occasioned by the petitioner. In the facts and circumstances of the case, without adverting to merits or otherwise of the contentions raised by the learned counsel for the petitioner, we are of the opinion that the writ petition can be disposed of at the stage of admission directing the second respondent to dispose of the appeals preferred by the petitioner as expeditiously as possible not later than 30.1.2009, in accordance with law. With this direction, the writ petition is disposed of. No order as to costs. ____________________ Justice T.Meena Kumari _______________________ Justice Ramesh Ranganathan November 11, 2008 MAS "