Allowed

M/S.Cool Mind Technologies Private Limited v. Assistant Commissioner of Income Tax

Kerala HC4 Jun 2024WA/717/2024

Case brief

AI extract

What is this about?

Assessee's appeal before the Income Tax Appellate Tribunal was dismissed for non-prosecution and its belated restoration application rejected; the Division Bench held the Tribunal is statutorily bound to decide appeals on merits and restored the appeal for fresh disposal after hearing.

What did the court decide?

Writ appeal allowed; impugned Single Judge judgment and Ext.P4/P6 Tribunal orders set aside; appeal ITA 375/Coch/2016 restored with direction to decide on merits within six months.

M/S.Cool Mind Technologies Private Limited Vs Assistant… — Income Tax | Kerala HC (2024)

¶1

IN THE HIGH COURT OF KERALA AT ERNAKULAM

¶2

PRESENT

¶3

THE HONOURABLE DR. JUSTICE A.K.JAYASANKARAN NAMBIAR

¶4

¶5

THE HONOURABLE MR. JUSTICE SYAM KUMAR V.M.

¶6

TUESDAY, THE 4^TH DAY OF JUNE 2024 / 14TH JYAISHTA, 1946 WA NO. 717 OF 2024

¶7

AGAINST THE ORDER/JUDGMENT DATED IN WP(C) NO.9100 OF 2020 OF HIGH COURT OF KERALA APPELLANT/PETITIONER

¶8

M/S.COOL MIND TECHNOLOGIES PRIVATE LIMITED A-5, 2ND FLOOR, TAPASYA, INFOPARK, KAKKANAD, KOCHI-682030, REPRESENTED BY ITS MANAGING DIRECTOR ABRAHAM JACOB., PIN – 682030

¶9

BY ADVS. ABRAHAM JOSEPH MARKOS V.ABRAHAM MARKOS JOHN VITHAYATHIL ISAAC THOMAS P.G.CHANDAPILLAI ABRAHAM ALEXANDER JOSEPH MARKOS SHARAD JOSEPH KODANTHARA

¶10

RESPONDENT/RESPONDENT

¶11

1 ASSISTANT COMMISSIONER OF INCOME TAX CIRCLE-1(1), AAYAKAR BHAWAN, I.S. PRESS ROAD, KOCHI, PIN – 682018

¶12

2 PRINCIPAL COMMISSIONER OF INCOME TAX CIRCLE-1(1), AAYAKAR BHAWAN, I.S. PRESS ROAD, KOCHI, PIN – 682018

¶13

3 INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, KENDRIYA BHAVAN, KAKKANAD, KOCHI, PIN - 682037

W.A.No.717 of 2024

OTHER PRESENT:

SC SRI JOSE JOSEPH

¶18

THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 04.06.2024, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

W.A.No.717 of 2024

J U D G M E N T

============

Dr. A.K.Jayasankaran Nambiar, J.

¶24

This appeal is filed against the judgment dated 08.02.2024 of a learned Single Judge in W.P(C)No.9100 of 2020.

¶25

The brief facts necessary for a disposal of the appeal

¶26

are as follows:

¶27

The appellant is engaged in Software Development and Export of IT enabled services for which it had claimed deduction under Section 10B as a 100% EOU. For the assessment years 2007-08 and 2008-09, the claim for deduction was denied. In the first appeal, the appellant raised an alternate contention for deduction under Section 10A of the IT Act, in the event, the claim under Section 10B was not allowed. This alternate ground was allowed by the First Appellate Authority for the assessment year 2008-09, but was rejected by the same authority for the assessment year 200708.

¶28

W.A.No.717 of 2024

¶29

¶30

Against the rejection by the First Appellate Authority, the appellant preferred an appeal before the Income Tax Appellate Tribunal. The said appeal however came to be dismissed for non prosecution. It is the case of the appellant that he received neither the notice of hearing before the Appellate Tribunal nor the dismissal order of the Appellate Tribunal. When he eventually got a copy of the said dismissal order of the Appellate Tribunal, he preferred an application for restoration of the appeal, but the said application was also dismissed as belated.

¶31

It is impugning the said dismissal orders of the Appellate Tribunal, dismissing the appeal and the miscellaneous application, that the appellant approached the writ court through the writ petition aforementioned.

¶32

The learned Single Judge who considered the matter, although noticed the provisions of Section 254 of the Income Tax Act, read with Rule 24 of the Income Tax (Appellate Tribunal) Rules, 1963, and found that the Appellate Tribunal was statutorily obliged to consider the appeal on merits, and

¶33

W.A.No.717 of 2024

¶34

¶35

did not have the power to dismiss the appeals filed before it for non prosecution, nevertheless proceeded to dismiss the writ petition on the ground that the miscellaneous application preferred by the appellant for restoration of the appeal, was itself belated.

¶36

We have heard Sri.Joseph Markos, the learned Senior Counsel assisted by Sri.Abraham Joseph Markos for the appellant and Sri.Jose Joseph, the learned Standing Counsel for the Income Tax Department.

¶37

On a consideration of the rival submissions, we find that another Division Bench of this Court, in the decision reported in Uzhuva Service Co-operative Bank Ltd. v. Income Tax Officer and others [2020 (5) KHC 615] has, in an almost identical situation, found that the Income Tax Appellate Tribunal acting under Section 254 of the IT Act, 1961, cannot dismiss an appeal preferred by an assessee for non-prosecution. The court found that in terms of the provisions of Section 254 of the IT Act, the Appellate Tribunal was statutorily obliged to consider all appeals on merits and

¶38

W.A.No.717 of 2024

¶39

¶40

the dismissal for non-prosecution, without considering the merits of the appeal, was not legally sustainable. We further notice that in the said case also, the assessee had filed an application for the restoration of the appeal beyond the statutory period prescribed under the Income Tax (Appellate Tribunal) Rules. The situation, therefore, was not different from what arises in the instant case.

¶41

Thus, taking note of the said precedent of this Court and finding it to be in confirmity with the statutory provisions under the IT Act and Rules, we allow this writ appeal by setting aside the impugned judgment of the learned Single Judge, as also Ext.P4 and P6 orders of the Income Tax Appellate Tribunal that were impugned in the writ petition, and direct the Appellate Tribunal to restore the appeal (ITA 375/Coch/2016) on its file and pass orders on merits after hearing the appellant, within an outer time limit of six months from the date of receipt of a copy of this judgment.

¶42

W.A.No.717 of 2024

¶43

¶44

The writ appeal is disposed as above.

¶45

Sd/-

¶46

DR. A.K.JAYASANKARAN NAMBIAR

¶47

JUDGE

¶48