MARTIN PUTHUMANA THOMAS V. ASSISTANT COMMISSIONER OF INCOME TAX KANNUR,

WP(C)/1316/2019

AI Insights

In this case, Martin Puthumana Thomas, the proprietor of M/s. Puthumana Gold House, challenged a series of assessment orders issued by the Assistant Commissioner of Income Tax, Kannur, for the assessment years 2010-11 to 2014-15. After appealing these orders, the Commissioner of Income Tax Appeals granted a conditional stay, requiring the petitioner to pay 15% of the aggregate demand, reduced by any demand already paid, in three equal installments. Dissatisfied with this interim order, the petitioner filed a writ petition in the High Court of Kerala. The main legal contention revolved around the requirement for the tax authority to provide reasons for reopening assessments under Section 148 of the Income Tax Act, which the petitioner argued was not adequately addressed.

• Counselvise Citation: [2019] 140 COUNSELVISE.COM (IT) 758654 (HC-KERALA)
• Appeal Type: Others
• Pronouncement Date: 15-02-2019
• Assessment Year: misc
• Laws Referred To: Income Tax Act
• Result in Favour of: Revenue
• Court: HIGH COURT
• Department Lawyers: CHRISTOPHER ABRAHAM
• Assessee Lawyers: S RAJ
• Keywords: Appeal; Assessment Order; Income Tax; Stay order; Discretionary Authority
• Section: 148

Judgement Text

"IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE DAMA SESHADRI NAIDU FRIDAY, THE 15TH DAY OF FEBRUARY 2019 / 26TH MAGHA, 1940 WP(C) No. 1316 of 2019 PETITIONER/S: MARTIN PUTHUMANA THOMAS, AGED 41 YEARS PROPRIETOR OF M/S.PUTHUMANA GOLD HOUSE, MAIN ROAD, PAYYANNUR-670307, BY ADVS. SRI.S.ARUN RAJ SMT.C.T.SUJA RESPONDENT/S: 1 ASSISTANT COMMISSIONER OF INCOME TAX KANNUR, CIRCLE-1, KANNUR RANGE, KANNUR-670006. 2 THE PRINCIPAL COMMISSIONER OF INCOME TAX, AAYAKAR BHAVAN, MANANCHIRA, KOZHIKODE-673001. 3 THE COMMISSIONER OF INCOME TAX (APPEALS), AAYAKAR BHAVAN, MANANCHIRA, KOZHIKODE-673001. OTHER PRESENT: SC SRI CHRISTOPHER ABRAHAM THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 15.02.2019, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C) No. 1316 of 2019 ..2.. JUDGMENT The petitioner, an assessee, challenged the Ext.P2 series of assessment orders in Ext.P3 appeals. The appellate authority, that is, the Commissioner of Income Tax Appeals, issued Ext.P12 order of stay. In that, the appellate authority directed the petitioner “to pay 15% of the aggregate demand as reduced by demand already paid” in three equal instalments so that the balance demand will stand stayed until the adjudication of the appeal. Assailing this interim order, the petitioner has filed this WP(C). 2. The petitioner's counsel has brought to my notice that after filing the WP(C), the petitioner paid Rs.17,79,490/- on 26.09.2018. The break-up amount for each assessment year WP(C) No. 1316 of 2019 ..3.. runs as follows: Payment made on 26.09.2018 2010-11 Rs.9,85,590/- 2011-12 Rs.3,05,390/- 2012-13 Rs.1,43,890/- 2013-14 Rs.3,44,62/- 3. Sri.Arun Raj S., the learned counsel for the petitioner, has submitted arguments on the merits. According to him, the Supreme Court, through a series of judgments, has held that a notice under Section 148 of the Income Tax Act must have reasons set out. Once an assessee receives notice under Section 148 of the Income Tax Act and requests the authority concerned for reasons, the authority, then, ought to supply the reasons for the notice under Section 148 of the Income Tax Act. In this context, Sri.Arun Raj has drawn my attention to a couple of judgments from the Supreme Court. 4. At any rate, I am concerned with the WP(C) No. 1316 of 2019 ..4.. discretionary domain of the appellate authority. The petitioner's counsel has fairly submitted that the appellate authority does have the discretion to grant a conditional order; nevertheless, he asserts that once the appellant demonstrates more than a prima facie case, passing a conditional order cannot be a ritual. 5. Attractive as the learned counsel's submissions is, there cannot be any proposition of law, nor can I readily find one, that if the appellant could demonstrate as he presumes for a fruitful case in appeal. Still, he does not deprive of the appellate authority's discretion. The courts, in judicial review, are not to interfere with the discretionary orders and passed by statutory authorities unless the authority has acted ultra vires, are the very exercise of judiciary, bogus and pervasive. I there find WP(C) No. 1316 of 2019 ..5.. neither of the grounds. I express my inability to interfere with the Ext.P5. I, accordingly, dismiss the WP(C). If the appellate authority insists on balance of Ext.P12, it will take into account the amounts the petitioner is said to have paid after filing this WP(C). As the petitioner has been bona fide in prosecuting this WP(C), the date the appellate authority fixed for compliance of the condition in Ext.P12 stands extended by two months. Sd/- DAMA SESHADRI NAIDU JUDGE Bka/16.02.2019 APPENDIX PETITIONER'S/S EXHIBITS: EXHIBIT P1 TRUE COPY OF THE LETTERS DATED 28.8.2016 SUBMITTED BY THE PETITIONER TO THE 1ST RESPONDENT SEEKING THE REASONS FOR REOPENING THE ASSESSMENT FOR THE AY'S 2010-11 TO 2014-15. WP(C) No. 1316 of 2019 ..6.. EXHIBIT P2 TRUE COPY OF THE ASSESSMENT ORDER DATED 29.12.2016 PASSED BY THE 1ST RESPONDENT FOR THE ASSESSMENT YEARS 2010-11. EXHIBIT P2(a) TRUE COPY OF THE ASSESSMENT ORDER DATED 29.12.2016 PASSED BY THE 1ST RESPONDENT FOR THE ASSESSMENT YEARS 2011-12. EXHIBIT P2(b) TRUE COPY OF THE ASSESSMENT ORDER DATED 29.12.2016 PASSED BY THE 1ST RESPONDENT FOR THE ASSESSMENT YEARS 2012-13. EXHIBIT P2(c) TRUE COPY OF THE ASSESSMENT ORDER DATED 29.12.2016 PASSED BY THE 1ST RESPONDENT FOR THE ASSESSMENT YEARS 2013-14. EXHIBIT P2(d) TRUE COPY OF THE ASSESSMENT ORDER DATED 29.12.2016 PASSED BY THE 1ST RESPONDENT FOR THE ASSESSMENT YEARS 2014-15. EXHIBIT P3 TRUE COPY OF THE STATUTORY FIRST APPEALS FILED BEFORE THE 3RD RESPONDENT BY THE PETITIONER FOR THE AY 2010-11. EXHIBIT P3(a) TRUE COPY OF THE STATUTORY FIRST APPEALS FILED BEFORE THE 3RD RESPONDENT BY THE PETITIONER FOR THE AY 2011-12. EXHIBIT P3(b) TRUE COPY OF THE STATUTORY FIRST APPEALS FILED BEFORE THE 3RD RESPONDENT BY THE PETITIONER FOR THE AY 2012-13. EXHIBIT P3(c) TRUE COPY OF THE STATUTORY FIRST APPEALS FILED BEFORE THE 3RD RESPONDENT BY THE PETITIONER FOR THE AY 2013-14. WP(C) No. 1316 of 2019 ..7.. EXHIBIT P3(d) TRUE COPY OF THE STATUTORY FIRST APPEALS FILED BEFORE THE 3RD RESPONDENT BY THE PETITIONER FOR THE AY 2014-15. EXHIBIT P4 TRUE COPY OF THE ORDER DATED 22.2.2017 ISSUED TO THE PETITIONER BY THE 1ST RESPONDENT REJECTING THE STAY PETITION FOR THE AY'S 2010-11 TO 2014-15. EXHIBIT P5 TRUE COPY OF THE CHALLANS EVIDENCING THE PAYMENTS MADE BY THE PETITIONER ON 30.3.2017 AND 13.4.2017. EXHIBIT P6 TRUE COPY OF THE STAY PETITION FILED BEFORE THE 2ND RESPONDENT BY THE PETITIONER FOR THE AY-2010-11. EXHIBIT P6(a) TRUE COPY OF THE STAY PETITION FILED BEFORE THE 2ND RESPONDENT BY THE PETITIONER FOR THE AY-2011-12. EXHIBIT P6(b) TRUE COPY OF THE STAY PETITION FILED BEFORE THE 2ND RESPONDENT BY THE PETITIONER FOR THE AY-2012-13. EXHIBIT P6(c) TRUE COPY OF THE STAY PETITION FILED BEFORE THE 2ND RESPONDENT BY THE PETITIONER FOR THE AY-2013-14. EXHIBIT P6(d) TRUE COPY OF THE STAY PETITION FILED BEFORE THE 2ND RESPONDENT BY THE PETITIONER FOR THE AY-2014-15. EXHIBIT P6A TRUE COPY OF THE LETTER DATED 24.6.2017 SUBMITTED TO THE 2ND RESPONDENT BY THE PETITIONER. EXHIBIT P7 TRUE COPY OF THE ORDER DATED 21.11.2017 PASSED BY THE 2ND RESPONDENT DISPOSING THE STAY PETITIONS FOR THE AY'S 2010-11 TO 2014-15. WP(C) No. 1316 of 2019 ..8.. EXHIBIT P8 TRUE COPY OF THE ORDER DATED 21.11.2017 PASSED BY THE 2ND RESPONDENT IN THE CASE OF AN ASSESEE SRI.P.K.VIJAYAN, SOUTH BAZAR, KANNUR. EXHIBIT P9 TRUE COPY OF THE COMPUTERIZED RECEIPT EVIDENCING THE PAYMENTS MADE ON 14.12.2017 BY THE PETITIONER FOR THE AY 2011-12 TO 2014-15. EXHIBIT P10 TRUE COPY OF THE STAY PETITION FILED BY THE PETITIONER BEFORE THE 3RD RESPONDENT CIT (APPEALS), KOZHIKODE FOR THE AY-2010-11. EXHIBIT P10(a) TRUE COPY OF THE STAY PETITION FILED BY THE PETITIONER BEFORE THE 3RD RESPONDENT, CIT (APPEALS), KOZHIKODE FOR THE AY-2011-12. EXHIBIT P10(b) TRUE COPY OF THE STAY PETITION FILED BY THE PETITIONER BEFORE THE 3RD RESPONDENT, CIT (APPEALS), KOZHIKODE FOR THE AY-2012-13. EXHIBIT P10(c) TRUE COPY OF THE STAY PETITION FILED BY THE PETITIONER BEFORE THE 3RD RESPONDENT, CIT (APPEALS), KOZHIKODE FOR THE AY-2013-14. EXHIBIT P10(d) TRUE COPY OF THE STAY PETITION FILED BY THE PETITIONER BEFORE THE 3RD RESPONDENT, CIT (APPEALS), KOZHIKODE FOR THE AY-2014-15. EXHIBIT P11 TRUE COPY OF THE JUDGMENT DATED 12.2.2018 PASSED IN WPC.NO.4333 OF 2018 BY THIS HONOURABLE COURT. EXHIBIT P12 TRUE COPY OF THE ORDER DATED 12.9.2018 PASSED BY THE 3RD RESPONDENT ON EXHIBIT P10 SERIES STAY PETITION FOR THE AY'S 2010-11, 2011-12, 2012-13, 2013-14 AND 2014-15. "