Noorul Islam Educational Trust, Rep. by its Chairman A.P.Majeed Khan V. The Commissioner of Income Tax(Appeals - I), Madurai and The Commissioner of Income Tax(Appeals III), Ernakulam and The Deputy Commissioner of Income Tax, Central Circle - I, Trivandrum and The Income Tax Officer, Ward I(1), Nagercoil

WP(MD)/7212/2013

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The case involves Noorul Islam Educational Trust, represented by its Chairman A.P. Majeed Khan, challenging a show-cause notice issued by the Income Tax Officer, Nagercoil, regarding non-payment of an assessed amount. The petitioner had previously obtained an interim stay from the Commissioner of Income Tax, Madurai, which was not extended beyond December 31, 2012, and the appeal remained pending. The petitioner argued that the issuance of the notice during the pendency of the appeal and the stay constituted contempt of court. The court found that the first respondent, being the successor in interest, was bound by the earlier interim stay and directed the Commissioner to expedite the decision on the stay petition.

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 805499 (HC-MISC)
• Appeal Type: Others
• Pronouncement Date: 26-04-2013
• Assessment Year: misc
• Laws Referred To: Article 226 of the Constitution of India
• Result in Favour of: Applicant
• Court: HIGH COURT
• Department Lawyers: KRISHNAMURTHY
• Assessee Lawyers: M AJMAL KHAN
• Keywords: Assessment; Income Tax; Non-payment; Penalty; Stay Petition; Writ of Certiorari
• Section: P.A.N./G.I.R.No.AAATN 116/B

Judgement Text

"1 BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT DATED: 26.04.2013 CORAM: THE HONOURABLE MR.JUSTICE K.K.SASIDHARAN W.P.(MD)No.7212 of 2013 and M.P(MD)Nos.1 and 2 of 2013 Noorul Islam Educational Trust, Rep. by its Chairman A.P.Majeed Khan. : Petitioner Vs. 1.The Commissioner of Income Tax(Appeals - I), No.2, V.P.Rathinasamy Nadar Road, Bibikulam, Madurai - 625 002. 2.The Commissioner of Income Tax(Appeals III), Ernakulam, Kochi - 16. 3.The Deputy Commissioner of Income Tax, Central Circle - I, Trivandrum. 4.The Income Tax Officer, Ward I(1), Nagercoil. : Respondents Prayer: Writ Petition is filed under Article 226 of the Constitution of India praying for the issue of a Writ of Certiorari calling for the records relating to the impugned proceedings issued by the fourth respondent in P.A.N./G.I.R.No.AAATN 116/B, dated 18.03.2013 and quash the same as illegal. For Petitioner : Mr.M.Ajmalkhan for M/s. Ajmal Associates For Respondents : Mr.Krishnamurthy Standing counsel for Income Tax ******** ORDER By consent, the Writ Petition itself is taken up for final disposal. 2. The Writ Petition is directed against the notice dated 18 March, 2013 on the file of the Income Tax Officer, Nagercoil, whereby and where under, the petitioner was directed to show-cause as to why penalty should not be levied on account of non-payment of assessed amount. 3. The petitioner is an assessee on the file of the Income Tax Officer, Nagercoil. The Income Tax Officer passed an order of https://hcservices.ecourts.gov.in/hcservices/ 2 assessment on 14 February, 2009. The said order was challenged by the petitioner before the Commissioner of Income Tax, Kochi. Since there was no stay granted, the petitioner moved the High Court of Kerala in W.P(Civil)No.12442 of 2009 to stay the proceedings of recovery till the disposal of the appeal. The learned Judge was pleased to pass an order directing the Commissioner of Income Tax, Kochi to consider and dispose of the stay petition filed by the petitioner within a period of one month. The Assessing Authority was directed not to initiate recovery proceedings for recovering the disputed tax till the disposal of the stay petition. The appeal was thereafter transferred to the file of Commissioner of Income Tax, Madurai. 4. The Commissioner of Income Tax, Madurai after the transfer of appeal, granted an interim stay, which was later extended up to 31 December, 2012. The interim order was not extended thereafter. The appeal is stated to be pending. 5. While the matters stood thus, the fourth respondent issued the impugned notice directing the petitioner to show-cause as to why penalty should not be imposed. The said notice is challenged in this Writ Petition. 6. The learned Senior Counsel for the petitioner contended that The High Court of Kerala granted interim stay till the disposal of the stay petition. Even though the said order was against the Commissioner of Income Tax, Kochi, the first respondent being the authority to whom the appeal was transferred, is bound by the said order. According to the learned counsel, the Commissioner of Income Tax, Madurai granted stay up to 31 December, 2012 and the appeal is kept pending. During the currency of the appeal, the fourth respondent was not justified in issuing notice for recovery and the same would amount to contempt of Court. 7. According to the learned standing counsel for Income Tax, the impugned notice is only a show-cause notice and it is open to the petitioner to submit his explanation. 8. The appeal preferred by the petitioner against the order passed by the third respondent is now pending before the first respondent. The High Court of Kerala on an earlier occasion stayed the recovery till the disposal of stay petition by the Commissioner of Income Tax, Kochi. It was only the said appeal which was later transferred to the file of first respondent. The first respondent being the successor in interest is bound by the order passed by the High Court of Kerala in W.P(Civil)No.12442 of 2009. In fact, the first respondent extended the interim order till 31 December, 2012. 9. The appeal was preferred during the year 2009 and it was later transferred to the first respondent. Nothing prevented the Commissioner of Income Tax, Madurai from taking up the appeal and dispose of the same on merits. In case the Commissioner was of the view that it will take time to dispose of the appeal, he should have passed an order in the stay petition. Failure on the part of the first https://hcservices.ecourts.gov.in/hcservices/ 3 respondent to pass final orders in the stay petition made the petitioner to come up with the Writ Petition. 10. The Commissioner of Income Tax, Madurai is directed to consider and dispose of the stay petition filed by the petitioner, as expeditiously as possible and in any case within a period of four weeks from today. The impugned notice of recovery would be kept abeyance till the disposal of the stay petition by the first respondent. 11. The Writ Petition is disposed of with the above direction. No Costs. Consequently, connected miscellaneous petitions are closed. Sd/- Assistant Registrar(AS) /True copy/ Sub Assistant Registrar To 1.The Commissioner of Income Tax(Appeals - I), No.2, V.P.Rathinasamy Nadar Road, Bibikulam, Madurai - 625 002. 2.The Commissioner of Income Tax(Appeals III), Ernakulam, Kochi - 16. 3.The Deputy Commissioner of Income Tax, Central Circle - I, Trivandrum. 4.The Income Tax Officer, Ward I(1), Nagercoil. +1 CC to Mr.R. Krishnamoorthy, SC for IT, SR.No.24114 +1 CC to Mr.M. Ajmalkhan,Advocate, SR.No. 24092 pm MM/16.05.2013/3P-7C/ Order made in W.P.(MD)No.7212 of 2013 Dated: 26.04.2013 https://hcservices.ecourts.gov.in/hcservices/ "