M/s.Bontala Aleem Miah, Works Contractor V. The Assistant Commissioner of Income Tax, Circle-1 and The Bank of India and Union Bank of India and The Union of India

WP/948/2022

AI Insights

The case involves M/s. Bontala Aleem Miah, a works contractor, who filed a writ petition against the Assistant Commissioner of Income Tax, Circle-1, and two banks, challenging the issuance of garnishee notices for the recovery of disputed taxes for the assessment years 2014-15 to 2018-19. The petitioner argued that despite having paid more than 20% of the disputed tax amount and having an excess tax refund with the Income Tax Department, the department proceeded with coercive recovery actions. The court heard arguments from both sides and decided to allow the petitioner to formally present his case to the tax authority, emphasizing the need for the tax authority to consider the petitioner's payment and pending appeal before taking further action.

• Counselvise Citation: [2022] 140 COUNSELVISE.COM (IT) 679803 (HC-ANDHRA_PRADESH)
• Appeal Type: Others
• Pronouncement Date: 20-01-2022
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: HIGH COURT
• Department Lawyers: M KIRANMAYEE
• Assessee Lawyers: G NARENDRA CHETTY
• Keywords: Coercive Steps; Disputed taxes; Garnishee notice; Stay of demand; Writ of Mandamus
• Section: 226(3)

Judgement Text

" 1 HIGH COURT OF ANDHRA PRADESH AT AMARAVATI HON’BLE Mr. JUSTICE AHSANUDDIN AMANULLAH AND HON’BLE Ms. JUSTICE B. S. BHANUMATHI WRIT PETITION No.948 OF 2022 M/s.Bontala Aleem Miah, Works Contractor, H.No.44/18-G-1, Vishwa Apartment, Prakash Nagar, Kurnool – 518 004, Kurnool. … Petitioner Versus 1. The Assistant Commissioner of Income Tax, Circle-1, Oppo.Children’s Park, N.R.Pet, Kurnool, Kurnool District, Andhra Pradesh. 2. The Bank of India, near RTC Bus Stand, Bellary Road, Kurnool – 518 003, Kurnool District, Andhra Pradesh, rep. by its Branch Manager. 3. Union Bank of India, Kurnool Medical College Campus, Budhwarpet, Kurnool – 518 002, Kurnool District, Andhra Pradesh, rep. by its Branch Manager. 4. The Union of India, rep. by its Secretary (Finance), Ministry of Finance, North Block, New Delhi – 110 001. … Respondents Counsel for the petitioner : Mr. G.Narendra Chetty, Advocate Counsel for the respondents : Ms. M. Kiranmayee, Standing counsel ORAL JUDGMENT Date: 20.01.2022 (Per Hon’ble Mr. Justice Ahsanuddin Amanullah) Heard Mr. G. Narendra Chetty, learned counsel for the petitioner and Ms. M. Kiranmayee, learned counsel for income tax. 2. The petitioner has moved the Court for the following relief: “to issue writ, order or direction more particularly one in the nature of a Writ of Mandamus holding that the action of the First Respondent in taking coercive steps for recovery 2 of the entire disputed taxes relating to the Assessment Years 2014-15, 2015-16, 2016-17, 2017-18 and 2018-19, by issuing the impugned Garnishee notices, dated 14.12.2021, vide DIN & Notice No.ITBA/COM/F/17/2021- 22/1037791079(1), and DIN & Notice No.ITBA/COM/F/17/2021-22/1037790548(1) u/S.226(3) of the Income Tax Act, 1961, to the Second and Third Respondent Banks respectively, where the petitioner is having its accounts, demanding payment of the entire balance disputed tax of Rs.93,79,425/- from the bank Accounts of the petitioner, even though the excess tax/refund amount of the Petitioner of Rs.57,83,530/- is already available with the First Respondent which is more than 20% of the balance disputed tax, as arbitrary, capricious, contrary to the binding directions of the CBDT and judgments of the Hon’ble Courts and illegal and consequently set-aside the same and to pass such other order or orders…” 3. Learned counsel for the petitioner submitted that out of the disputed amount, the petitioner has paid more than 20% of the disputed amount and also moved before the concerned appellate authority against the demand, which is still pending. 4. It was submitted that as per Clause 4 of office memorandum dated 29.02.2016, as raised by office memorandum dated 25.08.2017, on depositing 20% of the disputed amount and the matter pending before the appellate authority, it had sought stay of the demand till disposal of the first appeal. 5. It was submitted that five days back, the Income Tax Department has issued garnishee notice to the bank for releasing the balance disputed amount. 6. Learned counsel for Income Tax submitted that the figures being quoted by the petitioner are not correct and that there is no occasion for them to verify the same till date, as the petitioner has not 3 informed them about moving before the concerned authority against such demand. 7. Learned counsel for the petitioner submitted that the Court may permit the petitioner to move before the authority concerned informing it that the petitioner has moved before the appropriate forum against the demand raised by the respondent no.1, who may be directed to consider the request for stay. 8. Having regard to the stand taken by the parties, the writ petition stands disposed of with liberty to the petitioner to file proper petition before respondent no.1 bringing it to its notice the fact that it has already moved before the appropriate authority having paid more than 20% of the disputed demand. If such representation is filed within 2 weeks from today, showing payment of at least 20% of the disputed demand, the respondent no.1 shall consider the same and pass necessary orders within two weeks thereafter. Upon the petitioner filing such representation, the bank shall not pay the amount to the authorities till final order is passed by respondent no.1. However, the petitioner shall keep in his account an amount equivalent to the disputed amount, as shown in the garnishee notice. 9. Miscellaneous petitions, if any pending, also stand disposed of. _________________________________ (AHSANUDDIN AMANULLAH,J) _______________________ (B. S. BHANUMATHI,J) C.C by Monday. B/o. Rns 4 HON’BLE Mr. JUSTICE AHSANUDDIN AMANULLAH AND HON’BLE Ms. JUSTICE B. S. BHANUMATHI WRIT PETITION No.948 OF 2022 Date : 20.01.2022 5 Rns "