M.V.VISWANATHAN V. THE PRINCIPAL COMMISSIONER OF INCOME TAX-II

WP(C)/12969/2017

AI Insights

The case involves M V Viswanathan, the petitioner, who challenged the order of the Assessing Officer regarding the stay of recovery pending appeal against an income tax demand of Rs.1,04,86,230. The petitioner was initially directed to pay Rs.75,50,086, which was contested as being more than 75% of the total demand. The petitioner argued for a stay based on a CBDT circular allowing a stay on payment of 15% of the total demand. The court found that the Assessing Officer did not properly justify the requirement for a higher payment for the stay and thus granted the relief sought by the petitioner.

• Counselvise Citation: [2017] 140 COUNSELVISE.COM (IT) 755441 (HC-KERALA)
• Appeal Type: Others
• Pronouncement Date: 11-04-2017
• Assessment Year: misc
• Laws Referred To: Income Tax Act
• Result in Favour of: Partly Allowed
• Court: HIGH COURT
• Department Lawyers: K M V PANDALAI; CHRISTOPHER ABRAHAM
• Assessee Lawyers: B ASHOK SHENOY; K V GEORGE; P N RAJAGOPALAN NAIR; P S GIREESH; RIYAL DEVASSY
• Keywords: Appeal; Assessment Order; Demand; Income Tax; Stay of recovery
• Section: 143(3)

Judgement Text

"IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR.JUSTICE K.VINOD CHANDRAN TUESDAY, THE 11TH DAY OF APRIL 2017/21ST CHAITHRA, 1939 WP(C).No. 12969 of 2017 (U) ---------------------------- PETITIONER(S): ------------- M V VISWANATHAN, AGED 56 YEARS, SON OF VELAYUDHAN PILLAI, MECHERIL HOUSE, EDAYAR, BINANIPURAM P O ALUVA 683 502 BY ADVS.SRI.B.ASHOK SHENOY SRI.K.V.GEORGE SRI.P.N.RAJAGOPALAN NAIR SRI.P.S.GIREESH SRI.RIYAL DEVASSY RESPONDENTS: -------------- 1. THE PRINCIPAL COMMISSIONER OF INCOME TAX-II CENTRAL REVENUE BUILDINGS, IS PRESS ROAD, KOCHI 682 018 2. THE COMMISSIONER OF INCOME TAX (APPEALS ) II POORNIMA BUILDINGS, PANAMPILLY NAGAR, KOCHI 682 036 3. THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE I KAP COMPLEX, RAILWAY STATION ROAD ALUVA 683 101 R BY SRI.K.M.V.PANDALAI, INCOME TAX DEPARTMENT SRI CHRISTOPHER ABRAHAM THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 11-04-2017, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WPC NO.12969/2017 (U) :2: APPENDIX EXT.P1: TRUE COPY OF THE ASSESSMENT ORDER DT 9.3.2016 PASSED BY THE 3RD RESPONDENT IN RESPECT OF PETITIONER FOR THE ASSESSMENT YEAR 2013-14 ALONGWITH INCOME TAX COMPUTATION FORM ATTACHED THEREWITH EXT.P2: TRUE COPY OF THE NOTICE OF DEMAND DATED 09.03.2016 ISSUED BY THE 3RD REPONDENT TO PETITIONER UNDER PAN - AASPV5072B EXT.P3: TRUE COPY OF THE APPEAL DT 15.6.2016 FILED BY THE PETITIONER BEFORE THE 2ND RESPONDENT EXT.P4: TRUE COPY OF THE APPLICATION FOR STAY DT 2.6.2016 FILED BY PETITIONER BEFORE 2ND RESPONDENT EXT.P5: TRUE COPY OF PRESS RELEASE DT 03.03.2016 WITH THE OFFICE MEMORANDUM F NO.404/72/93-ITCC DT 29.2.2016 ISSUED BY THE CENTRAL BOARD OF DIRECT TAXES. EXT.P6: TRUE OCY OF THE NOTICE NO. CIT 2/CHN/STAY/2016-17 DATED 25.7.2016 ISSUED BY THE 1ST RESPONDENT TO PETITIONER EXT.P7: TRUE COPY OF LETTER NO.AC/CIR/ALV/AASPV 5072 b/2016-17 DATED 31.03.2017 ISSUED TO PETITIONER BY 3RD RESPONDENT RESPONDENTS EXHIBITS: NIL TRUE COPY P.A TO JUDGE jma K. VINOD CHANDRAN, J - - - - - - - - - - - - - - - - - - - -- - - - W.P(C) No. 12969 of 2017 U - - - - - - - - - - - - - -- - - -- - - -- - - - -- Dated this the 11th day of April, 2017 J U D G M E N T The petitioner is aggrieved with Ext.P7 order passed by the Assessing officer in an application filed for stay of recovery pending appeal. The total demand would come to Rs.1,04,86,230/-. The assessee was directed to pay a sum of Rs.75,50,086/-. The assessee hence was before the Assessing Officer for reduction of the amounts demanded for reason of it being more than 75% of the total demand made. The assessee also claims the benefit of the circular of CBDT which directed the Assessing Officer, at his discretion to grant a stay on payment of 15% of the total demand. 2. Herein it is seen from the order, that the Principal CIT, Kochi, was approached for instructions, within WP(C) No.12969/2017 : 2 : the terms of the guidelines. The Assessing Officer had made a bland statement in Ext.P7 order, that the nature of addition resulting in the disputed demand, warrants payment of lump sum amount, higher than 15%. However, nothing is disclosed in the order as to why the Assessing Officer came to such a conclusion. In such circumstances, this Court is of the opinion that the assessee can be granted a stay of recovery on payment of 15% of the amounts granted. 3.The learned Counsel for the petitioner submits that there is a claim for refund of Rs.14,52,499/- which would come to 15% and the same has already been given credit by the Assessing Officer as per Ext.P7. It cannot be said that the petitioner was given credit of the refund. Pending consideration of the refund application, the Assessing Officer WP(C) No.12969/2017 : 3 : merely reduced that amount from the condition imposed of payment. In such circumstances, the petitioner would have to pay 15% of the demand within a period of one month from today, upon which there shall be a stay of recovery till the appeal is disposed of. The refund application shall be considered independently and adjustment made at the discretion of the Officer. Writ petition is partly allowed. Sd/- (K. VINOD CHANDRAN, JUDGE) jma //true copy/ P.A to Judge "