Disposed

Kerala State Beverages (M&M) Corporation Ltd. v. the Assistant Commissioner of Income Tax, CIRCLE-1(1)

Kerala HC14 Mar 2014WA/437/2014

Case brief

AI extract

What is this about?

The High Court, in two writ appeals concerning assessment years 2009-10, 2010-11, and 2011-12, ordered the appellant to deposit 10% of the outstanding tax liability as a condition for an interim stay. The court directed the appellate authorities to dispose of the appeals on merits within three months due to a pending controversial issue regarding the deductibility of surcharges and turnover taxes.

What did the court decide?

Appellant directed to deposit 10% of outstanding liability by 31st March; appellate authorities directed to dispose appeals within three months.

Kerala State Beverages (M&M) Corporation Ltd. Vs the Assistant Commissioner of Income Tax, CIRCLE-1(1) — Kerala HC (2014) — LawSathi Research

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT:

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THE HON'BLE THE CHIEF JUSTICE DR. MANJULA CHELLUR & THE HONOURABLE MR.JUSTICE A.M.SHAFFIQUE

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FRIDAY, THE 14TH DAY OF MARCH 2014/23RD PHALGUNA, 1935

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WA.No. 437 of 2014 ()

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----------------------------AGAINST THE JUDGMENT DATED 25-02-2014 IN WP(C).NO. 5406/2014.

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APPELLANT/APPELLANT:

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M/S.KERALA STATE BEVERAGES (M&M) CORPORATION LTD., P.B. 2263, SASTHAKRIPA OFFICE COMPLEX, SASTHAMANGALAM, THIRUVANANTHAPURAM.

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BY ADVS.SRI.ANIL D. NAIR, SRI. SREEJITH R.NAIR, SRI. SULEKHA BEEVI C.S., SRI. ROSIE ATHULYA JOSEPH.

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RESPONDENTS/RESPONDENTS:

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1. THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE-1(1), TRIVANDRUM - 695 001.

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2. THE INCOME TAX APPELLATE TRIBUNAL, COCHIN -682 018.

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BY SRI.P.K.R. MENON, SENIOR SC. ADV. SRI.JOSE JOSEPH, SC, INCOME TAX.

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THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 14-03-2014, ALONG WITH W.A. NO. 438 OF 2014, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

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rs.

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MANJULA CHELLUR, C.J & A.M.SHAFFIQUE, J.

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W.A. Nos. 437 of 2014 and

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438 of 2014

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Dated this the 14^th March, 2014

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JUDGMENT

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Manjula Chellur, C.J.

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Heard learned counsel for appellant Mr.Anil Nair and also learned senior standing counsel for income tax.

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So far as Writ Appeal No. 437/2014 it pertains to assessment years 2009-2010 and 2010-2011 and Writ Appeal No.438/2014 pertains to assessment year 2011-2012. The appellant before us is Kerala State Beverages (M&M) Corporation Limited.

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It is not in dispute that by virtue of incorporation of provision as per Section 40(ii) (b) it would come into effect from 1.4.2014. The same would have some impact on the controversy involved in this case. However, the controversial issue is pending consideration before the appellate tribunal and also first appellate authority. In these two appeals the issue is whether

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W.A. Nos. 437 of 2014 and 438 of 2014

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surcharge paid by the petitioner under the Kerala Surcharge on Taxes Act, 1957 and also turnover tax paid in terms of provisions of Kerala General Sales Tax Act, 1963 are liable to be deducted from the total income as envisaged under Section 37 of the Income Tax Act while computing the taxable income. The assessing authority has opined that though the appellant Corporation is not entitled to pass on this burden to the purchasers, still is liable to pay. This issue is pending before two different appellate authorities as stated above. Meanwhile, learned single Judge, having regard to the total liability against the appellant-assessee was of the opinion, as the appellate authorities concerned have to decide the controversial issue pending before them, it would be just and proper to satisfy 40% of the outstanding liability in both the cases. According to appellant's counsel, in the absence of any certainty with regard to their liability to pay, it would be nothing but a huge uncomfortable burden on the assessee-Corporation to shell out said amount which ultimately may be found not liable to pay.

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Having regard to the amount involved and especially the additional provision which is going to be effective from 1.4.2014 which has to be interpreted, we are of the opinion, 10% of the

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W.A. Nos. 437 of 2014 and 438 of 2014

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outstanding liability should be deposited to have the benefit of interim order of stay during pendency of the appeals pending before the concerned appellate authorities and the amount shall be paid on or before 31^st of March. We also direct the concerned appellate authorities to dispose of the appeals on merits within three months from today.

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Sd/- MANJULA CHELLUR, CHIEF JUSTICE

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Sd/A.M.SHAFFIQUE, JUDGE

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rka 15.3.14

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/true copy/

Kerala State Beverages (M&M) Corporation Ltd. v. the Assistant Commissioner of Income Tax, CIRCLE-1(1)

Case brief

What is this about?

What did the court decide?

Kerala State Beverages (M&M) Corporation Ltd. v. the Assistant Commissioner of Income Tax, CIRCLE-1(1)

Case brief

What is this about?

What did the court decide?

What the court decided

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Issues for consideration

Statutes considered

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