✦ High Court of India · 27 Mar 2025

BY AD vs ASWIN GOPAKUMAR

Case Details High Court of India · 27 Mar 2025
Court
High Court of India
Decided
27 Mar 2025
Bench
BECHU KURIAN THOMAS
Length
1,070 words

Acts & Sections

SRI JOSE JOSEPH, SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 27.03.2025, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C) NO. 12641 OF 2025 3 BECHU KURIAN THOMAS, J. =-=-=-=-=-=-=-=-=-=-=-=-=-=- W.P.(C) No.12641 of 2025 =-=-=-=-=-=-=-=-=-=-=-=-=-= Dated this the 27th day of March, 2025 JUDGMENT Petitioner challenges Ext.P8 order passed by the Income Tax Appellate Tribunal, Cochin Bench in S.A.No.190/Coch/2024 dismissing the stay petition filed by the petitioner in the said appeal. Petitioner also challenges Ext.P13 order of the 3rd respondent imposing penalty under Section 270A of the Income Tax Act, 1961 (for short' 'the Act') for the assessment year 2017-18.

2. Petitioner had approached this Court in W.P.(C) No.30276 of 2023 challenging Ext.P4 order of the appellate authority for the assessment year 2017-18. The said writ petition was disposed of, directing the petitioner to prefer an appeal before the Income Tax Appellate Tribunal, in a time bound manner and also directed the Tribunal to consider the same in accordance with law including any application for stay. The learned single Judge further directed that the petitioner must deposit 20% of assessment to enable the stay application to be considered. The said judgment was taken up in appeal and by judgment dated 23.09.2024 in W.A.No.1494 of 2024, a Division Bench of this Court declined to interfere with the judgment of the learned single Judge except to the extent it directed deposit of 20% of the disputed tax as a WP(C) NO. 12641 OF 2025 4 pre-condition for filing a stay petition. The Division Bench also directed that till the stay petition is heard, recovery of the amounts should be kept in abeyance.

3. Subsequently, petitioner preferred the appeal before the Tribunal and while enjoying the stay granted by the Division Bench, the case was taken up by the Tribunal on 10.01.2025, and by a common order, the stay petition was dismissed after observing that the petitioner had failed to deposit 20% of the outstanding demand which was a condition precedent for the grant of stay. Curiously the common order was passed in three different cases, which according to the petitioner had no connection with each other.

4. Having heard Sri.Aswin Gopakumar, the learned counsel for the petitioner as well as Sri.Jose Joseph, the learned Standing Counsel, I am satisfied that the impugned order Ext.P8 is perverse and is liable to be set aside.

5. The direction of the learned single Judge to deposit 20% of the outstanding demand as a condition precedent for filing a stay petition was vacated by the Division Bench and therefore there was no such condition. On the other hand, the Tribunal was specifically directed to consider the stay petition in a time bound manner. To dismiss the stay petition on the ground of failure to comply with a non-existing condition precedent is perverse and requires interference. Accordingly, Ext.P8 is WP(C) NO. 12641 OF 2025 5 set aside.

6. As mentioned earlier, petitioner has also challenged an order under Section 270A of the Act imposing penalty. Since imposition of penalty is a separate cause of action and appellate remedy is available against such an order, petitioner ought to pursue the said remedy. Petitioner cannot bypass the statutory remedy of an appeal available against Ext.P13.

7. In the circumstances, this writ petition is allowed in part as follows :- (i). Ext.P8 order of the Appellate Tribunal in S.A.No.190/Coch/2024 for the AY 2017-18 dated 30.01.2025 is set aside and the Tribunal is directed to reconsider the stay petition filed by the petitioner, as expeditiously as possible, at any rate, within a period of two months from the date of receipt of a copy of this judgment. (ii). The challenge against Ext.P13 is dismissed, reserving the liberty of the petitioner to pursue his statutory remedies, in accordance with law. The proceedings for recovery pursuant to Ext.P13 shall be kept in abeyance for a period of two weeks to enable the petitioner to prefer the appeal. RKM BECHU KURIAN THOMAS, JUDGE Sd/- WP(C) NO. 12641 OF 2025 6 APPENDIX OF WP(C) 12641/2025 PETITIONER'S EXHIBITS : Exhibit P1 TRUE COPY OF THE ASSESSMENT ORDER BEARING NO. ITBA/AST/S/143(3)/2019- 20/1022424476(1) DATED 16.12.2019 Exhibit P2 TRUE COPY OF THE NOTICE DATED 16.12.2019 Exhibit P3 TRUE COPY OF THE REPLY TO EXT. P2 NOTICE Exhibit P4 Exhibit P5 Exhibit P6 Exhibit P7 COPY TRUE ITBA/NFAC/S/250/2023-24/1055335883(1) DATED 23.08.2023 PASSED BY THE APPELLATE AUTHORITY ORDER NO. OF TRUE COPY OF THE JUDGMENT DATED 21.09.2023 IN WP(C) 30276 OF 2023 TRUE COPY OF THE JUDGMENT DATED 23.09.2024 IN WA 1494 OF 2024 TRUE COPY OF THE APPEAL FILLED AGAINST EXT. P4 ORDER TO RESPONDENT NO.1, UNDER SECTION 253 OF THE IT ACT Exhibit P8 TRUE COPY OF THE ORDER DATED 30.01.2025 Exhibit P9 TRUE COPY OF THE NOTICE DATED 05.03.2021 Exhibit P10 TRUE COPY OF THE REPLY DATED 17.03.2021 Exhibit P11 TRUE COPY OF THE NOTICE DATED 03.01.2025 Exhibit P12 Exhibit P13 TRUE COPY OF THE REPLY GIVEN BY THE PETITIONER DATED 08.01.2025 TRUE COPY OF THE ORDER DATED 05.03.2025 BEARING DIN NO. ITBA/PNL/F/270A/2024- 25/1074084205(1) PASSED BY THE RESPONDENT WP(C) NO. 12641 OF 2025 7 Exhibit P14 NO.3 ALONG WITH THE COMPUTATION SHEET DIN TRUE COPY OF THE DEMAND NOTICE DATED 05.03.2024, NO. BEARING ITBA/PNL/S/156/2024-25/1074084195(1) ISSUED UNDER SECTION 156 OF THE IT ACT DIRECTING THE PETITIONER TO PAY THE PENALTY OF RS.4,25,78,026/-(RUPEES FOUR CRORES TWENTY FIVE LAKHS SEVENTY EIGHT THOUSAND AND TWENTY SIX ONLY) WITHIN A PERIOD OF 30 DAYS

SRI JOSE JOSEPH, SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 27.03.2025, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C) NO. 12641 OF 2025 3 BECHU KURIAN THOMAS, J. =-=-=-=-=-=-=-=-=-=-=-=-=-=- W.P.(C) No.12641 of 2025 =-=-=-=-=-=-=-=-=-=-=-=-=-= Dated this the 27th day of March, 2025 JUDGMENT Petitioner challenges Ext.P8 order passed by the Income Tax Appellate Tribunal, Cochin Bench in S.A.No.190/Coch/2024 dismissing the stay petition filed by the petitioner in the said appeal. Petitioner also challenges Ext.P13 order of the 3rd respondent imposing penalty under Section 270A of the Income Tax Act, 1961 (for short' 'the Act') for the assessment year 2017-18.

2. Petitioner had approached this Court in W.P.(C) No.30276 of 2023 challenging Ext.P4 order of the appellate authority for the assessment year 2017-18. The said writ petition was disposed of, directing the petitioner to prefer an appeal before the Income Tax Appellate Tribunal, in a time bound manner and also directed the Tribunal to consider the same in accordance with law including any application for stay. The learned single Judge further directed that the petitioner must deposit 20% of assessment to enable the stay application to be considered. The said judgment was taken up in appeal and by judgment dated 23.09.2024 in W.A.No.1494 of 2024, a Division Bench of this Court declined to interfere with the judgment of the learned single Judge except to the extent it directed deposit of 20% of the disputed tax as a WP(C) NO. 12641 OF 2025 4 pre-condition for filing a stay petition. The Division Bench also directed that till the stay petition is heard, recovery of the amounts should be kept in abeyance.

3. Subsequently, petitioner preferred the appeal before the Tribunal and while enjoying the stay granted by the Division Bench, the case was taken up by the Tribunal on 10.01.2025, and by a common order, the stay petition was dismissed after observing that the petitioner had failed to deposit 20% of the outstanding demand which was a condition precedent for the grant of stay. Curiously the common order was passed in three different cases, which according to the petitioner had no connection with each other.

4. Having heard Sri.Aswin Gopakumar, the learned counsel for the petitioner as well as Sri.Jose Joseph, the learned Standing Counsel, I am satisfied that the impugned order Ext.P8 is perverse and is liable to be set aside.

5. The direction of the learned single Judge to deposit 20% of the outstanding demand as a condition precedent for filing a stay petition was vacated by the Division Bench and therefore there was no such condition. On the other hand, the Tribunal was specifically directed to consider the stay petition in a time bound manner. To dismiss the stay petition on the ground of failure to comply with a non-existing condition precedent is perverse and requires interference. Accordingly, Ext.P8 is WP(C) NO. 12641 OF 2025 5 set aside.

6. As mentioned earlier, petitioner has also challenged an order under Section 270A of the Act imposing penalty. Since imposition of penalty is a separate cause of action and appellate remedy is available against such an order, petitioner ought to pursue the said remedy. Petitioner cannot bypass the statutory remedy of an appeal available against Ext.P13.

7. In the circumstances, this writ petition is allowed in part as follows :- (i). Ext.P8 order of the Appellate Tribunal in S.A.No.190/Coch/2024 for the AY 2017-18 dated 30.01.2025 is set aside and the Tribunal is directed to reconsider the stay petition filed by the petitioner, as expeditiously as possible, at any rate, within a period of two months from the date of receipt of a copy of this judgment. (ii). The challenge against Ext.P13 is dismissed, reserving the liberty of the petitioner to pursue his statutory remedies, in accordance with law. The proceedings for recovery pursuant to Ext.P13 shall be kept in abeyance for a period of two weeks to enable the petitioner to prefer the appeal. RKM BECHU KURIAN THOMAS, JUDGE Sd/- WP(C) NO. 12641 OF 2025 6 APPENDIX OF WP(C) 12641/2025 PETITIONER'S EXHIBITS : Exhibit P1 TRUE COPY OF THE ASSESSMENT ORDER BEARING NO. ITBA/AST/S/143(3)/2019- 20/1022424476(1) DATED 16.12.2019 Exhibit P2 TRUE COPY OF THE NOTICE DATED 16.12.2019 Exhibit P3 TRUE COPY OF THE REPLY TO EXT. P2 NOTICE Exhibit P4 Exhibit P5 Exhibit P6 Exhibit P7 COPY TRUE ITBA/NFAC/S/250/2023-24/1055335883(1) DATED 23.08.2023 PASSED BY THE APPELLATE AUTHORITY ORDER NO. OF TRUE COPY OF THE JUDGMENT DATED 21.09.2023 IN WP(C) 30276 OF 2023 TRUE COPY OF THE JUDGMENT DATED 23.09.2024 IN WA 1494 OF 2024 TRUE COPY OF THE APPEAL FILLED AGAINST EXT. P4 ORDER TO RESPONDENT NO.1, UNDER SECTION 253 OF THE IT ACT Exhibit P8 TRUE COPY OF THE ORDER DATED 30.01.2025 Exhibit P9 TRUE COPY OF THE NOTICE DATED 05.03.2021 Exhibit P10 TRUE COPY OF THE REPLY DATED 17.03.2021 Exhibit P11 TRUE COPY OF THE NOTICE DATED 03.01.2025 Exhibit P12 Exhibit P13 TRUE COPY OF THE REPLY GIVEN BY THE PETITIONER DATED 08.01.2025 TRUE COPY OF THE ORDER DATED 05.03.2025 BEARING DIN NO. ITBA/PNL/F/270A/2024- 25/1074084205(1) PASSED BY THE RESPONDENT WP(C) NO. 12641 OF 2025 7 Exhibit P14 NO.3 ALONG WITH THE COMPUTATION SHEET DIN TRUE COPY OF THE DEMAND NOTICE DATED 05.03.2024, NO. BEARING ITBA/PNL/S/156/2024-25/1074084195(1) ISSUED UNDER SECTION 156 OF THE IT ACT DIRECTING THE PETITIONER TO PAY THE PENALTY OF RS.4,25,78,026/-(RUPEES FOUR CRORES TWENTY FIVE LAKHS SEVENTY EIGHT THOUSAND AND TWENTY SIX ONLY) WITHIN A PERIOD OF 30 DAYS

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