SRI. JOHN MATHEWS V. THE INCOME TAX OFFICER

WP(C)/16073/2014

AI Insights

The case involves Sri. John Mathews, a salaried employee of M/S. Lots Shipping Ltd., who faced issues with the proper accounting of his tax deduction at source by his employer in the Income Tax Department's system. Despite presenting evidence of tax deduction (Form No.16 and remittance chalan) to the Income Tax Officer, the demand raised under Section 143(1) of the Income Tax Act, 1961 was not rectified. The petitioner argued that the refusal to acknowledge the tax deduction was contrary to the instructions from the Central Board of Direct Taxes and various High Court precedents. The court found merit in the petitioner's arguments and directed a re-evaluation of his case by the Assessing Officer.

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 755756 (HC-KERALA)
• Appeal Type: Others
• Pronouncement Date: 08-07-2014
• Assessment Year: misc
• Other Referred Cases: (2007) 293 ITR 539, (2013) 352 ITR 273, Civil Miscellaneous Writ Petition (Tax) No.657/2013 cited Rakesh Kumar Gupta vs. Union of India and another, 242 ITR 638 (GAU), 303 ITR 395 (MUM), (2007) 10 STT 36(ALL)= (2007) 8 VST 738 (ALL)
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: JOSE JOSEPH
• Assessee Lawyers: DALE KURIEN
• Keywords: Assessing Officer; CBDT instructions; Form No.16; Income Tax; Tax deduction at source
• Section: 143(1)

Judgement Text

"IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR.JUSTICE K.VINOD CHANDRAN TUESDAY, THE 8TH DAY OF JULY 2014/17TH ASHADHA, 1936 WP(C).No. 16073 of 2014 () --------------------------- PETITIONER : ----------------------- SRI. JOHN MATHEWS, 16-CHOICE BUILDERS, NADAMA EAST, TRIPUNITHURA,KOCHI-682 301. BY ADV. SRI.DALE P.KURIEN RESPONDENT(S): ---------------------------- 1. THE INCOME TAX OFFICER, WARD-3(2), RANGE-3, I.S.PRESS ROAD, ERNAKULAM, KOCHI-682 018. 2. THE CENTRAL BOARD OF DIRECT TAXES, NEW DELHI-110 001, REPRESENTED BY ITS CHAIRMAN. 3. M/S.LOTS SHIPPING LTD., GCDA COMPLEX, MARINE DRIVE, KOCHI-682 031, REPRESENTED BY IT'S MANAGING DIRECTOR SRI.PHILIP MATHEWS. R1 BY STANDING COUNSEL SRI.JOSE JOSEPH THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 08-07-2014, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: sts WP(C).No. 16073 of 2014 () -------------------------------------- APPENDIX PETITIONER(S)' EXHIBITS ------------------------------------- EXHIBIT-P1: TRUE COPY OF THE NOTICE FROM THE FIRST RESPONDENT TO THE PETITIONER DATED 5.3.2013. EXHIBIT-P2: TRUE COPY OF THE REPLY DATED 18.3.2014. EXHIBIT-P2(A): COPY OF FORM NO.16 TDS CERTIFICATE DATED 28.7.2008 ISSUED BY 3RD RESPONDENT TO THE PETITIONER. EXHIBIT-P2(B): COPY OF REMITTANCE CHALAN OF TDS BY THE 3RD RESPONDENT DATED 27.7.2009. EXHIBIT-P3: TRUE COPY OF LETTER FROM THE FIRST RESPONDENT DATED 7.4.2014. EXHIBIT-P4: TRUE COPY PRESS NOTE NO.402/92/2006-MC DATED 17.4.2014 BY THE SECOND RESPONDENT. EXHIBIT-P5: TRUE COPY OF THE DECISION OF THE HON'BLE BOMBAY HIGH COURT REPORTED IN (2007) 293 ITR 539. EXHIBIT-P5(A): TRUE COPY OF THE DECISION OF THE HON'BLE DELHI HIGH COURT REPORTED IN (2013) 352 ITR 273. EXHIBIT-P5(B): TRUE COPY OF THE UNREPORTED, RECENT JUDGMENT OF HON'BLE HIGH COURT OF ALLAHABAD, IN CIVIL MISCELLANEOUS WRIT PETITION (TAX) NO.657/2013 CITED RAKESH KUMAR GUPTA VS. UNION OF INDIA AND ANOTHER. EXHIBIT-P6: TRUE COPY OF THE REPORTED DECISION REPORTED IN 242 ITR 638 (GAU). EXHIBIT-P6(A): TRUE COPY OF THE REPORTED IN 303 ITR 395 (MUM). EXHIBIT-P7: TRUE COPY OF THE DECISION CITED ASSOTECH REALITY (P) LTD. VS. STATE OF UP & ANOTHER REPORTED IN (2007) 10 STT 36(ALL)= (2007) 8 VST 738 (ALL). RESPONDENT(S)' EXHIBITS: NIL /TRUE COPY/ P.S.TO.JUDGE sts K. Vinod Chandran, J. ------------------------------------ W.P.(C).No.16073 of 2014-H ------------------------------------ Dated this the 08th day of July, 2014 JUDGMENT The petitioner is a salaried employee of the 3rd respondent, whose tax deduction at source, though alleged to have been uploaded in the system of the Department, failed to be properly accounted in the system. In such circumstance, Section 143(1) intimation under the Income Tax Act, 1961 was issued to the petitioner and subsequently a demand was raised, as evidenced by Exhibit P1. The petitioner had approached the officer with the relevant documents, being Form No.16 issued by the employer, as evidenced by Exhibit P2. Despite the evidence for tax deduction being produced before the officer, by Exhibit P3 the same was declined. The petitioner's contention is that this is in violation of the umpteen instructions issued by the Central Board of Direct Taxes [CBDT] as also the binding precedents in Exhibits P5 and P6 series of judgments. WP(C).No.16073 of 2014 - 2 - 2. The learned Standing Counsel for Government of India [Taxes] produces a Circular, numbered as F.No.275/032013-IT(B) dated 08.07.2013 [Instruction No.05/2013], wherein a communication was issued by the CBDT taking into account the difficulties faced by the various assessees for reason only of the tax being not uploaded and also pursuant to the directions issued by the Delhi High Court. The Instruction clearly mandates as to how the tax deduction made by the employer, on evidence being produced, is to be dealt with, though not uploaded in the system. 3. This was the precise request made by the petitioner as per Exhibit P2, wherein he had produced the tax deduction certificate, issued under Form No.16 by his employer. In fact the assessee had produced Exhibit P4, which is subsequent to Instruction No.05/2013 and which would also further the case of the assessee. In such circumstance, Exhibit P3 is set aside. The Assessing Officer, the 1st respondent, shall consider the same in accordance with Instruction No.05/2013, Exhibit P4 as also in tune WP(C).No.16073 of 2014 - 3 - with the dictum laid down by the various High Courts in Exhibits P5 and P6. The petitioner shall approach the Assessing Officer personally within two weeks and produce a certified copy of this judgment along with legible copies of Exhibits P5 and P6 judgments; and within two months from the date of appearance, the matter shall be settled by the Assessing Officer, after calling for any further details from the petitioner, if so required. Writ petition allowed. Sd/- K.Vinod Chandran Judge. vku/- ( true copy ) "