Kerala High Court
A.P. Kuruvilla And Co. And Ors. vs Central Board Of Direct Taxes And Ors. on 30 March, 1995
JUDGMENT K. Narayana Kurup, J.
1. Heard Shri N. R. K. Nair, standing counsel for the Income-tax Department also.
2. The matter relates to waiver of interest under Sections 234A and 234B of the Income-tax Act, 1961. Petitioners Nos. 1 to 3 are partnership-firms who were conducting abkari business during 1989-90 to 1991-92 in different ranges in Ernakulam Excise Division. Shri A. P. Kuruvilla was a partner in all the three firms at the relevant time.
3. Exhibit P-1 is the representation filed by the said A. P. Kuruvilla representing all the three firms, before the Central Board of Direct Taxes for waiver of interest imposed as per Sections 234A and 234B of the Income-tax Act concerning the income from the abkari business conducted by the three firms. Subsequent to the filing of exhibit P-1 representation, the petitioners preferred an application before the second respondent, viz., the Deputy Commissioner of Income-tax, West Fort, Trichur, for stay of collection of tax during the pendency of exhibit P-1. The said application was allowed by the second respondent and the stay order was communicated to the petitioners by the third respondent, viz., the Assistant Commissioner of Income-tax, Circle-1, Alwaye, as per exhibits P-2, P-3 and P-4 proceedings. In exhibit P-2, it is stated that the Deputy Commissioner of Income-tax has ordered instalment facility for payment of the tax portion of the demand raised under Section 143(1)(a) and, accordingly, the tax portion, viz., Rs. 1, 19,460, should be paid in eight monthly instalments at the rate of Rs. 15,000 each from the month of July, 1993, onwards, The interest portion of the demand raised under Section 143(1)(a) amounting to Rs. 1,43,280 is kept in abeyance. Similarly, in exhibits P-3 and P-4, the petitioners were given instalment facilities for payment of the tax demands raised under Section 143(1)(a) of the Income-tax Act. Learned counsel for the petitioners submits that the petitioners have complied with the conditions stipulated in exhibits P-2 to P-4 and the entire tax portions have been paid. The payment was over by March, 1995.
4. The grievance of the petitioners is that exhibits P-2 to P-4 have now been varied by exhibit P-5 order of the Deputy Commissioner of Income-tax. Having regard to the fact that the petitioners have complied with the conditions in exhibits P-2 to P-4, I am of the opinion that the stay against the recovery of interest shall continue pending disposal of exhibit P-1 application before the Central Board of Direct Taxes. In that view of the matter, exhibit P-5 proceedings of the Deputy Commissioner of Income-tax vacating the stay already granted as per exhibits P-2 to P-4 cannot be legally sustained. In this connection, it has to be noted that there is no express power of review in the Income-tax Act authorising the Deputy Commissioner of income-tax to review the order passed in a stay application. The only power conferred on the Deputy Commissioner of Income-tax is the power of rectification and not the power of review.
5. Viewed in the above perspective, exhibit P-5 cannot be sustained. I, therefore, quash exhibit P-5 and there will be a direction to the Central Board of Direct Taxes to pass orders on exhibit P-1 representation as expeditiously as possible and pending disposal of exhibit P-1 as aforesaid, exhibits P-2 to P-4 will stand revived.
6. The original petition is disposed of as above.