A stay on demand under the Income Tax Act can be granted while considering delay applications, ensuring taxpayer rights are protected.

Headnote:
Taxation - Income Tax Act - Sections 147, 144, 144B - The court dealt with the procedures regarding appeals and stays under the Income Tax Act, emphasizing the importance of timely application and requirements for staying recovery pending appeal.
Fact of the Case:

The petitioner sought to quash a demand notice and prevent coercive recovery actions pending the resolution of an appeal and stay application against an assessment order under the Income Tax Act.
Finding of the Court:

The court allowed the stay of the demand pending the resolution of the delay condonation and stay applications, provided the petitioner deposited 15% of the total demand, indicating the balance between taxpayer rights and tax authority obligations.
Issues: Whether the petitioner should be granted a stay on the demand pending the decision on the appeal and delay application filed against the assessment order.
Ratio Decidendi: The court established that a stay can be granted during the pendency of an appeal, especially when a significant delay in filing requires consideration and aim at providing fair relief to the taxpayer.
Final Decision: The writ petition was disposed of with directions to stay the demand under specified conditions.

JUDGEMENT

Dated this the 11th day of April, 2024 The present writ petition has been filed seeking the following reliefs:

i) Issue a writ in the nature of Certiorari or such other writ, direction, or order, calling for records leading to Exhibit P3 demand notice issued by the 2nd respondent and quash the same.

ii) Issue a writ of mandamus or such other writ, order, or direction, directing the 2nd respondent to not proceed with any coercive steps for recovery, till the disposal of Ext.p2 appeal or Ext.P2(a) stay petition pending before the 1st respondent. iii) grant such other and incidental reliefs as this Hon’ble Court may deem just and necessary on the facts and circumstances of this case.

iv) Pass such other writs, order or direction as this Hon’ble Court may deem fit and proper in the factual circumstances of this case.

2. The petitioner has filed an appeal along with stay application and application for condonation of delay against Ext.P1 assessment order dated 14.03.2022 passed under Section 147 read with Section 144 and 144B of the Income Tax Act .

3. Sri.P.G Jayasankar, learned Senior Standing Counsel for the Income Tax Department submits that the delay is huge WP(C)No.42345 of 2023 in filing the appeal. The petitioner has filed the appeal with delay of 150 days.

4. Considering the fact that the appeal has been filed along with the stay application and the application for condoning the delay of 150 days, the 1st respondent is directed to consider and pass necessary orders on application for condoning the delay as well as stay application expeditiously, preferably with in a period of two months. The demand in pursuance to Ext.P1 order shall remain stayed till the decision on application for condonation of delay and stay petition subject to making deposit of 15% of the total demand as per Ext.P1 assessment order. The petitioner is directed to remit 15% of the total demand as per Ext.P1 assessment order within a period of one week from today.

With the aforesaid directions, the present writ petition stands finally disposed of.

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2024 Supreme(Online)(KER) 2238

HIGH COURT OF KERALADinesh Kumar Singh, JDIANA PETER ALIAS DIANA GOMEZ – AppellantVersusCOMMISSIONER OF INCOME TAX (APPEALS) – RespondentWP(C) 42345/2023

A stay on demand under the Income Tax Act can be granted while considering delay applications, ensuring taxpayer rights are protected.

HIGH COURT OF KERALA
Dinesh Kumar Singh, J
DIANA PETER ALIAS DIANA GOMEZ – Appellant
Versus
COMMISSIONER OF INCOME TAX (APPEALS) – Respondent
WP(C) 42345/2023