2018 (2) TMI 516 - HC - Income Tax

Expiry of the period for filing an appeal - Interest u/s 220(2) - Held that - As against the order passed by the Commissioner of Income Tax (Appeals) dated 27.12.2017, the petitioner has an effective alternate remedy of an appeal before the Income Tax Appellate Tribunal. The time limit for preferring an appeal is 60 days from the date on which the order passed by the CIT(Appeals) was received by the petitioner Board. According to the learned counsel for the petitioner, the copy of the order was received on 08.01.2018. Therefore, well before the expiry of the period for filing an appeal, the respondent would not be justified in enforcing the demand dated 08.01.2018. If it is enforced, then the petitioner s right to file the appeal would be defeated and the appeal is likely to be rendered as infructuous. In the light of the above, demand notice dated 08.01.2018, issued by the second respondent, shall be kept in abeyance for a period of 60 days from 08.01.2018 till the expiry of the period for filing an appeal before the Income Tax Appellate Tribunal

Issues:
Seeking writ of mandamus to prevent coercive action for tax recovery, appeal to Commissioner dismissed, demand notice issued, alternative remedy of appeal before Income Tax Appellate Tribunal, enforcement of demand notice affecting right to appeal.

Analysis:

1. The petitioner approached the court seeking a writ of mandamus to restrain the respondents from taking coercive action for recovering taxes as per Assessment Orders dated 31.03.2016 for Assessment Years 2009-10 to 2012-13 under the Income Tax Act, 1961. Despite the dismissal of appeals by the Commissioner of Income Tax (Appeals) on 27.12.2017 and the subsequent issuance of a demand notice on 08.01.2018 amounting to &8377; 124,27,23,512/-, the petitioner argued that they have an alternate remedy of appealing before the Income Tax Appellate Tribunal. The court acknowledged the time limit of 60 days for filing an appeal from the date of receiving the order, which in this case was received on 08.01.2018, and emphasized the importance of not enforcing the demand notice before the expiry of the appeal filing period to protect the petitioner's right to appeal.

2. In light of the above circumstances, the court directed that the demand notice issued on 08.01.2018 should be kept in abeyance for 60 days from that date, allowing the petitioner Board the opportunity to pursue the matter before the Income Tax Appellate Tribunal without the risk of their appeal becoming futile due to premature enforcement of the demand notice. By disposing of the writ petition with this direction, the court ensured that the petitioner's right to appeal was safeguarded, maintaining the integrity of the legal process and protecting the petitioner's interests. The judgment highlighted the significance of following due process and respecting the timelines for appeal procedures to uphold the principles of natural justice and fairness in tax matters.

3. The court's decision to keep the demand notice in abeyance for the specified period demonstrated a balanced approach to addressing the petitioner's concerns while upholding the legal framework for tax appeals. By allowing the petitioner the opportunity to pursue their case before the appropriate appellate authority within the stipulated timeline, the court ensured that the petitioner's rights were protected and that the appeal process could proceed without undue hindrance or prejudice. This judgment underscored the importance of procedural compliance and adherence to statutory timelines in tax matters to ensure a fair and equitable resolution of disputes between taxpayers and tax authorities, promoting transparency and accountability in the administration of tax laws.

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