2018 (2) TMI 1713 - HC - Income Tax

Expeditious disposal of the appeal and the stay application filed - Held that - Such authorities even without any specific direction from the Constitutional Courts are expected to decide the appeal expeditiously and if that is not practically possible, at least, to decide the stay applications filed for interim relief as expeditiously as possible, so that no unnecessary prejudice is cause d to the appellants. The appellant-assessee in the present case is said to have filed the separate stay petition also before the Commissioner of Income Tax (Appeals) which is not yet decided. The present writ petition is therefore considered as premature and the same is disposed of with a liberty and direction to the petitioner to appear before both the concerned Respondents-authorities, namely, the Commissioner of Income Tax (Appeals) and the Assessing Authority and pursue for disposal of its stay application before the Commissioner of Income Tax (Appeals) and application under Section 220(6) of the Act before the concerned Income Tax Officer.

Summary

Issues:
1. Petitioner seeking mandamus direction for expeditious decision on pending appeal and stay application.
2. Disallowance of deduction under Section 80P(2)(a) of the Income Tax Act, 1961.
3. Denial of deduction due to engagement in other business activities.
4. Argument for expeditious decision based on precedent.
5. Court's opinion on pursuing regular appeal remedy.
6. Expectation of expeditious disposal of appeal and stay application.
7. Pending application before Assessing Authority under Section 220(6) of the Act.
8. Prematurity of the writ petition and directions for further action.

Analysis:
1. The petitioner, a Primary Agriculture Credit Cooperative Society, filed a writ petition seeking a mandamus direction for the expeditious decision on a pending appeal before the Commissioner of Income Tax (Appeals) and a stay application. The appeal was against an assessment order disallowing a deduction under Section 80P(2)(a) of the Income Tax Act, 1961, which granted exemption from income tax for providing credit facilities to members.

2. The Assessing Authority disallowed the deduction under Section 80P(2)(a) citing the petitioner's engagement in other business activities besides providing credit facilities. The petitioner contested this denial through the appeal, seeking a favorable decision on the claim for 100% deduction/exemption under the said section.

3. The court acknowledged the petitioner's argument for expeditious decision based on a precedent but refrained from expressing an opinion on the merits of the claim, considering it a mixed question of facts and law. The court opined that the petitioner should pursue the regular appeal remedy available.

4. Emphasizing the importance of expeditious disposal of appeals and stay applications, the court highlighted that authorities should decide such matters promptly to prevent unnecessary prejudice to the appellants. The petitioner had also filed a stay petition pending before the Commissioner of Income Tax (Appeals) awaiting a decision.

5. The court deemed the writ petition premature and directed the petitioner to appear before both the Commissioner of Income Tax (Appeals) and the Assessing Authority to pursue the disposal of the stay application and the application under Section 220(6) of the Act. The authorities were instructed to pass appropriate orders after providing a reasonable opportunity of hearing to the petitioner.

6. The court set specific dates for the petitioner to appear before the authorities and instructed them to pass speaking orders by a specified deadline. Additionally, the court directed that no precipitative action be taken against the petitioner until the authorities pass orders in accordance with the law.

7. The writ petition was disposed of with the mentioned observations, and no costs were imposed. The court ordered the copy of the order to be sent to the respondents promptly to ensure compliance with the directions provided in the judgment.