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Case Law Details

Case Name : Centre For Management Development Vs Commissioner Of Income-Tax (Exemptions) (Kerala High Court)
Appeal Number : WA No. 646 of 2024
Date of Judgement/Order : 20/05/2024
Related Assessment Year :

Centre For Management Development Vs Commissioner Of Income-Tax (Exemptions) (Kerala High Court)

The case of Centre For Management Development versus the Commissioner of Income-Tax (Exemptions), as adjudicated by the Kerala High Court, revolves around the assessment orders for the assessment years 2018-19, 2020-21, 2021-22, and 2022-23 under the Income Tax Act. The appellant, aggrieved by the judgment of a learned Single Judge in W.P(C) No.10745 of 2024, has approached the High Court.

The main contention raised by the appellant is regarding the direction given by the learned Single Judge to remit 20% of the assessed amounts pending disposal of stay applications and delay condonation applications by the First Appellate Authority. The appellant argues that while the Single Judge directed the Income Tax Department to consider the appellant’s applications for condonation of delay in filing returns, no stay was granted against the recovery of the assessed amounts during the pendency of the applications before the First Appellate Authority.

In the hearing, both parties presented their arguments, and after due consideration, the High Court found that the learned Single Judge had already directed the Income Tax Department to dispose of the appellant’s applications within a specified time limit. It was also noted that the Income Tax Department had summoned the appellant for a personal hearing in connection with the applications.

Upon review, the High Court modified the latter part of the Single Judge’s judgment, which directed the appellant to pay 20% of the assessed amounts pending consideration of the stay applications and delay condonation applications by the First Appellate Authority. The High Court deemed this direction legally unsustainable, as the appellant had made out a prima facie case warranting protection from the recovery of disputed demands during the pendency of the applications before the First Appellate Authority.

Therefore, the High Court maintained the part of the judgment directing the Income Tax Department to dispose of the appellant’s applications within a prescribed time. However, it modified the latter part of the judgment, directing the First Appellate Authority to consider the stay applications and delay condonation applications along with the appeals against the assessment orders within two months. The High Court further directed that the recovery of the amounts confirmed against the appellant by the assessment orders shall be kept in abeyance until orders are passed by the First Appellate Authority on the delay condonation and stay applications.

In conclusion, the writ appeal was disposed of by the High Court, with the direction to consider the appellant’s applications and appeals within a specified time frame and to suspend the recovery of the assessed amounts pending such consideration.

FULL TEXT OF THE JUDGMENT/ORDER OF KERALA HIGH COURT

The appellant has approached this Court aggrieved by the judgment dated 22.03.2024 of a learned Single Judge in W.P(C) No.10745 of 2024.

2. The limited contention urged by the learned counsel for the appellant is that the learned Single Judge while relegating the appellant to his alternate remedy of pursuing appeals, along with delay condonation applications and stay applications, against the impugned assessment orders for the assessment years 2018-19, 2020-21, 2021-22 and 2022-23 under the Income Tax Act, had directed the appellant to remit 20% of the assessed amounts in respect of all the assessment years pending disposal of the stay applications/condonation of delay applications by the First Appellate Authority.

3. The learned counsel for the appellant, Sri. Sherry Samuel Oommen would point out that the learned Single Judge had directed the 1st respondent to pass orders on the applications preferred by the appellant under Section 119 of the Income Tax Act for condonation of delay in filing returns which was necessary for a consideration of the claim for exemption made by the appellant on merits. The learned Single Judge, however, did not thereafter stay the recovery of the assessed amounts from the appellant for the aforementioned assessment years while directing consideration of stay applications/delay condonation applications preferred by the appellant along with the appeals filed before the First Appellate Authority under the Income Tax Act for the said assessment years.

4. We have also heard Sri. Jose Joseph, the learned Standing counsel for the Income Tax Department.

5. On a consideration of the rival submissions, and finding that the learned Single Judge by the impugned judgment has already directed the 1st respondent to dispose Ext.P3 series of applications within a specified time limit, and further that the 1st respondent has already summoned the appellant for a personal hearing in connection with the said applications, we dispose the writ appeal by modifying only the latter part of the impugned judgment of the learned Single Judge that directs the appellant to pay 20% of the assessed amounts pending consideration of the stay applications/delay condonation applications filed by the appellant before the First Appellate Authority (5th respondent) along with the appeals against the assessment order for the assessment years aforementioned. We find this latter direction of the learned Single to be legally unsustainable since the appellant has made out a prima facie case warranting a protection from recovery of the disputed demands pending consideration of the stay applications/condonation of delay applications by the First Appellate Authority.

6. Accordingly, while we maintain that part of the impugned judgment of the learned Single Judge that directs the 1 st respondent to dispose Ext.P3 series of applications within a prescribed time, we modify the latter part of the judgment of the learned Single Judge and direct that the 5th respondent shall consider the stay applications/delay condonation applications preferred by the appellant, along with the appeals against the assessment orders for the assessment years aforementioned, within a period of two months from the date of receipt of a copy of this judgment. The recovery of the amounts confirmed against the appellant by the assessment orders impugned in the appeals before the 5th respondent, shall be kept in abeyance till such time as orders are passed by the 5th respondent in the delay condonation applications/stay applications referred above.

The writ appeal is disposed as above.

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