A writ appeal filed by a gas cylinder and stove distributor has been partly allowed by the Madras High Court, which set aside the condition imposed by a single judge to pay 15% of the disputed tax amount.
Dhanapal Eswari, a distributor of gas cylinders and stoves, couldn’t file her Income Tax Return for Assessment Year 2018-19. Personal issues and unavoidable circumstances prevented her from completing the process on time.
An SCN has been furnished by the income tax officer to which the appellant answered on 30.03.2022, encompassing a CBDT e-challan for e-tax payment and an income statement. U/s 148 of the Income Tax Act, 1961, the appellant has asked for a notice to submit her return.
On 07.04.2022, the Assessment Unit passed an order and issued a notice u/s 148, which the appellant claimed she did not obtain because her email ID has changed.
She said that she will learnt about the notice on getting an intimation letter on 06.02.2023 from the Income Tax Department. It was ruled by the appellant that the revision in her email ID was duly communicated to the department.
The impugned order has been quashed by the Single Judge, in WP.No.10107/2024, though a condition is that the appellant file 15% of the disputed tax amount within 3 weeks for the case to be reconsidered.
The counsel of the appellant claimed that the condition to file 15% of the disputed tax was unplanned, provided the considered facts and the type of business, which comprises high turnover but low margins.
A division bench comprised of Justice S.S. Sundar and Justice C. Saravanan reviewed a Single Judge’s decision to quash an order and return the case for further consideration. The bench agreed that the decision was appropriate.
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They did, however, find the appellant’s obligation to pay 15% of the contested tax amount unreasonable. This condition was judged problematic because the tax liability had not been calculated on proven facts and could have serious consequences for the appellant.
While removing the 15% tax payment condition, the court partly permitted the writ appeal and quashed the impugned order. Based on the merits, the case was remitted by the court to the assessment unit for fresh consideration.
In 4 weeks from the receipt of the Madras High Court order, the department should pass a final order, the court said after hearing the parties and adhering to principles of natural justice. The writ plea was disposed of, and the related miscellaneous petitions were closed.
| Case Title | Dhanapal Eswari vs. The Income Tax Officer |
| Case No. | W.P.No.10107 of 2024 and W.M.P.Nos.11142 & 11144 of 2024 |
| For The Petitioner | Mr.I.Dinesh |
| For The Respondents | Dr.B.Ramaswamy |
| Madras High Court | Read Order |
