Pragathi Gramin Bank V. The Assistant Commissioner of Income Tax and The Commissioner of Income Tax and The Commissioner of Income Tax (Appeals)

WP/78267/2013

AI Insights

The case involves M/s. Pragathi Gramin Bank, represented by its Chairman, Sri M.G. Bhat, who filed a writ petition under Articles 226 & 227 of the Constitution of India against the Assistant Commissioner of Income Tax and other tax authorities. The petition sought to stay the recovery of a TDS demand pending the disposal of appeals related to the assessment year 2010-11. The petitioner argued that the demand for further payments was arbitrary and unreasonable, given the substantial amounts already paid and the funds available with the tax department. The court, after preliminary hearing and considering the submissions, granted an interim stay on the demand notice, requiring the appeals to be disposed of expeditiously within eight weeks.

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 799285 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 14-06-2013
• Assessment Year: misc
• Laws Referred To: Articles 226 & 227 of the Constitution of India
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: Y V RAVIRAJ
• Assessee Lawyers: A SHANKAR
• Keywords: Appeal; Income tax assessment; Interim order; Stay of recovery; TDS demand
• Section: 143(3)

Judgement Text

"WP.78267/2013 1 1 IN THE HIGH COURT OF KARNATAKA CIRCUIT BENCH AT DHARWAD DATED THIS THE 14TH DAY OF JUNE 2013 BEFORE THE HON’BLE MR.JUSTICE B.S.PATIL W.P.No.78267/2013 (T-IT) BETWEEN: M/s.Pragathi Gramin Bank, Rep. by its Chairman Sri M.G.Bhat, S/o. Sri Govinda Bhat, Aged about 56 years, Head Office, Sanganakal Road, Gandhinagar, Bellary – 583 103. ..PETITIONER (By Sri A.Shankar, Adv.) AND: 1. The Assistant Commissioner of Income Tax, Aayakar Bhavan, 2nd Floor, Staff Road, Fort, Bellary – 583 102. 2. The Commissioner of Income Tax, Aayakar Bhavan, Sedam Road, Gulbarga – 585 105. 3. The Commissioner of Income Tax (Appeals), C.R.Building, Navanagar, Hubli – 580 025. ..RESPONDENTS (By Sri Y.V.Raviraj, AGA. for R1 to 3) WP.78267/2013 2 2 This writ petition is filed under Articles 226 & 227 of the Constitution of India, praying to direct respondents 1 & 2 to stay the recovery of TDS Demand till the disposal of the appeal filed before the Commissioner of Income Tax (Appeals) for the A.Y.2010-11 as per Annexure-A and etc. This writ petition is coming on for Preliminary Hearing, this day the Court made the following:- ORDER 1. In this writ petition, petitioner is seeking a writ of mandamus against respondents 1 & 2 to stay the recovery of TDS demand made till the disposal of the appeal filed before the Commissioner of Income Tax (Appeals). The demand made is pursuant to the assessment of tax for the assessment year 2010-11. Petitioner has also sought for a direction to the 1st respondent not to take any coercive steps for recovery of disputed taxes. A direction is also sought to the 3rd respondent to dispose of the appeal expeditiously. 2. It is not in dispute that the petitioner has filed three appeals in ITA. Nos.187, 188 & 189/2012-13 challenging the assessment orders passed for the assessment year 2010-11. Though the appeals are filed well within time, no interim order is so far granted. In the meanwhile, as per Annexure-A order dated 24.05.2013, petitioner has been called upon to pay a WP.78267/2013 3 3 some of rupees twenty crores in two installments, first installment of rupees ten crores on 20.05.2013 and the second installment of rupees ten crores on 31.05.2013 and with regard to the other disputed demands on Rs.30.64 crores, 50% of the demand only was stayed till the disposal of the appeals and the remaining 50% of the demand has been ordered to be paid in eight monthly installments starting from June, 2013 onwards. Petitioner is aggrieved by this order passed by the Commissioner for Income Tax. 3. Several contentions on merits have been urged. It is mainly contended by the petitioner referring to Annexure-H – representation submitted by the petitioner that the amount of the assessee with the Department is in a sum of Rs.16,46,82,156/- and it has already paid rupees ten crores on 27.05.2013 as against the total demand of Rs.18,02,71,254/-. It is therefore contended that the requirement of paying any further amount towards the demand made is totally unnecessary and such a condition imposed in the interim order passed is arbitrary, unreasonable and hence, illegal. WP.78267/2013 4 4 4. On 31.05.2013, after hearing the learned counsel for the petitioner, this Court has passed the following order: “Heard the learned counsel for the petitioner. It is prima facie seen from the contention raised and the representation submitted vide Annexure ‘H’ that the amount of the assessee available with the Department is in a sum of Rs.16,46,82,156/- and the assessee has already paid Rs.10,00,00,000/- on 27.05.2013 as against the total demand of Rs.18,02,71,254/- with regard to the issue in question. In the light of the same, till the next date of hearing, there shall be an interim order of stay of Annexure ‘A’ order insofar as the demand made for payment of balance sum of Rs.10,00,00,000/-.” 5. Pursuant to the notice issued, the respondents have entered appearance through the learned counsel Sri Raviraj. 6. I have heard the learned counsel for both parties. I find that the interest of the respondents is sufficiently safeguarded WP.78267/2013 5 5 7. Having regard to the fact that already a sum of rupees ten crores has been deposited and it is prima facie shown that a sum of Rs.16,46,82,156/- is available with the department in the account of the assessee for the very same assessment year, in my considered view, it is just and appropriate to continue the interim order granted by this Court on 31.05.2013 till the disposal of the appeals by the Commissioner of Income Tax (Appeals) with a condition that the appeals shall be disposed of expeditiously within eight weeks from the date of receipt of a copy of this order. Accordingly, the impugned order - Annexure-A shall stand modified. There shall be stay of the demand notice issued till the disposal of the appeals by the Commissioner of Income Tax (Appeals). Writ Petition is accordingly disposed of. SD/- JUDGE PKS "