Disposed

Swamy Viveknanda Educational Trust v. Assessment Unit

Telangana HC15 Oct 2025WP/30468/2025

Case brief

AI extract

What is this about?

A charitable trust challenged the CIT (Exemptions)'s order directing partial payment of Rs.3.87 crores as condition for stay of a Rs.25.86 crore tax demand for AY 2023-24. The High Court held the order failed to deal with the specific grounds urged in the stay application and set it aside, remitting the matter to the CIT for fresh decision within four weeks after hearing the petitioner.

What the court decided

AI extract

Swamy Viveknanda Educational Trust Vs Assessment Unit — Income Tax | Telangana HC (2025)

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[³⁴⁸⁸ I

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IN THE HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD

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(Special Original Jurisdiction)

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WEDNESDAY,THE FIFTEENTH DAY OF OCTOBER TWO THOUSAND AND TWENTY FIVE

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PRESENT

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THE HONOURABLE THE CHIEF JUSTICE APARESH KUMAR SINGH AND THE HONOURABLE SRI JUSTICE G.M. MOHIUDDIN

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WRIT PETITION NO: 30468 OF 2025

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Betwee n:

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Swamy Viveknanda Educational Trust, Rep by its Secretary, I\4r. Gangidi lVlanohar Reddy, Sy No 288 and 289, Aushapur village, Ghatkesar Mandal, Hyderabad, Medchal [,4alkajgiri 500059, Telangana.

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...PETITIONER

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AND

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Assessment Unit, lncome Tax Department, National e- Assessment Center, Room No.401,2ndFloor, E-Ramp, Jawaharlal Nehru Stadium, New Delhi-110 003

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Commissioner of lncome Tax (Exemptions), 2nd Floor, Aayakar Bhavan, Basheerbagh, Hyderabad, Telangana.

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Principal Chief Commissioner of lncome Tax (Exemptions), R.No 2504, E-2, Block 25th Floor, Civic Centre, New Delhi.

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Union of lndia, rep. by its Secretary, f/linistry of Finance, Government of lndia, North Block, New Delhi-1 10 001.

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..RESPONDENTS

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Petition under Article 226 of the Constitution of lndia praying that in the circumstances stated in the affidavit filed therewith, the High Court may be pleased to issue a Writ of fi/andamus or any other appropriate writ, order or direction

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A) To set aside the decision on stay application issued by the 2nd Respondent vide its letter dated 30.08.2025 read with 15.09.2025 demanding Rs 3.87 crores, the order of stay application as the matter being a huge amount for grant of stay on tax demand is un.iust, unco nstitutional, and detrimental to the charitable sector and society at large covered and contrary to the facts that the petitioner is a valid holder of approval order for claiming exemption under section i o(23c)(vi) in Form 10AC.

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-r-|-rEE-

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B) To direct the iiespondents for speedy disposal of the appeal fjled in NFACl2022-23110445888 forthe assessment year 2023- 24

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lA NO: 1 OF 2025

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Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed i1 support of the petition, the High Court may be pleased to grant stay of all furher proceedings, including any recovery. pursuant to the impugned order und,rr Section 143(3) read with^'1 44-B of the lncome Tax Act. 1961 dated 06.03 2025 and penalty proceedings under Section 274 read with 27OA dated 06.03.20.25. issued by the 1't Respondent, for the assessment year 2023-24 and grant stzry until the matter is decided before CIT(A), NFAC. pending disposal of the above writ petition

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Counsel for the Petiti,rner: Ms. AKRUTI AGARWAL

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Counsel for the Respondent Nos. 1to3: SRI VIJHAY K PUNNA, SENIOR STANDING COUNSEL FOR INCOME TAX

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Counsel for the Resp,:ndent No.4: SRI N. BHUJANGA RAO, DY.SOLICITOR GENERAL OF INOIA

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The Court made the following: ORDER

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THE HON'BLE THE CHIEF JUSTICE SRI APARESH KUMAR^SINGH AND THE HON'BLE SRI JUSTICE G.M.MOHIUDDIN

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WRIT PETITION No.3O468 of 2025

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ORDER:

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Ms. Al<ruti Agzrru,:rl, learncd counsel for the petitioir(rr.

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Mr. Vijhay K Punna, learned Senior Standing Counsel for the lncome Ta-r Department appears for respondent Nos. 1 to 3 through video conferencing

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Thc application for stay on the recoverv of demand of Rs.25,86,36,93 1 /' pencling the appeal preferred by tl.re petitioner on 20.03.2025 in respect of the Assessmcnt Year 2023 24 l-ras been rejected by the Commissioner ol Income Ta;l (Dxemptions), Hyderabad (for short, "the CIT") by order dated 30.08.2025 impugned herein, which reads as under:

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"C'OVDRNMENT OF INDIA MINISTRY OF PINANCE INCOME TAX DEPARTMENT CIT (EXEIIIPTIONI, TIYD

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'ro I
(,t,. S. S*:.orv Vrr,'k.rn,rtd.r \r kr.s.rr. jsq.,n \r..,,t,r1.I j..<,,. lL.\lr,1: I:d1,,: r,,lLrl rr \ ril.,q, fru(l Il
'lcl:rne:rnil'lr'l r.rlr;rrl \l,.J.l,r,l \1.,1<.,t{rri :,Ui)0io I
l
I'AN: Asscssmcnt I)arcd: I DIN & Lettcr No:
AATTSO.;-25II Year I 30/08/2o2s I lrnnTcorvrT n7 r z
2L)23 24 1 1 t)tta< )r- I
III l1080186780 l

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Sir, Madarr /M/s,

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Subject: Orrline servlce of Orders - Letter

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Suir: Decision on Stay Application - Request for Partial Payment - Reg.

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This is rr rrh rclcrencc lo your application for sta], of collection of taxes, sul)mitt(\i lrelore th<: Commissioner oI Income Tzrx (Excrnptions), H-rrler-abarl. As per this the demand pa_-abk-'are as under-:

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'l . )L!! sI rt(llri qf)einr rlcl r. I t(rt: -2+ -l:,jtsalrlrr.(!

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Aftcr car.'fu h' cxanrining all relcvant facts and circumstarrces of your case, rnd also considcring the recent order of the Hon'ble Andhra Pra<lesh lligh Court rn tlre casc of M,/ s. 7 he lletrcrol and 'fec.hrticct' i:,tl tcctltort Sociel!/ (lA No. 1 of 2025 in WI) No 12728 of 2O25) anrl also con rirlcring the lfon'ble [ligtr Court of Telang;rna order in thc case <rf Zrros t ld Parks Auttlontlt of^'l'elunlJora u. CIT (E) ()()24) 467 ITR 235 ('l'elart r ttu t<t I [1O. 'our sta\ i1i]plicittion has been considered.

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It is, therefore, decided that your stay petition is considered provided yorr pay an amourt of Rs. 3 a7 oo O0O/- on or before O8.O9.2O25 :rnd produce eopies of challans before the Assessing Oflicer of yortr case and marked a copy to the undersigned.

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[)lease rrorr- tlr.rt if vou fail to comply \,ith this directive by the due datc, thc Assessing Offlcer will be at liberty to initiate coercive (ecovery proceedings under scction 226(3) of the I.T.Act, 1961 without any further communication.

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Furthcr \otr ar e inlbrmed to trcat this matter rvith urgencv and cnsure cornplianc,' i,ir hin the stipulated timeframe to avoid anv furrtrcr action b-, the Dcpart nent.

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BAI-A Kl?lSI{ Nr\ BAI'TU^LA CITiEXEMT'ION),^HYD

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Copy to

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I Asscssrng Officer. Addrtic nzrl Commissiorrer of Income Tax^{(Exmpl.Hyderabatd}

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BALA KRTSTINA BATTULA CIT(EXtrM I'TIoN),^HYD"

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-_,/

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The petitioner - assessee is a charitable institution, lr'hich \'as granted registration under Section 12AA(1)(b}(i) of the lncome Tax Act, 196 1 (for short, "the Act") vide order dated 26 .06.2OOB bv tire Director of L-rcome Tax (Exemptior.rs), Hyderabad. According to the petitioner, the trust u,as also granted approval under Section 1O(23C)(vi) from the Assessment Year 2OOB-09 onwards vide order dated 13.02.2009 of the Chief Commissioner of Income Tax, Hyderabad-I. It r,i'as a-lso granted approval under Section B0G(5)(vi) of the Act vide order dated 26.06 .2OO8 by the Director of Income Tar (Exemptions), Hyderabad. Such approvals were extended upto the Assessment Year 2026-27 as per order dated 24.O9.2021 in Form 10AC. Similar approval under Section 80G(5)(vi) ol the Act was also extended for the same period vide order dated 17 .I1.2021. Hence, according to the petitioner, for assessmcnt year 2023-24 the assessee trust was in possession of valid approval under Section 1O(23C)(vi) of the Act. The Assessing Officer vide order dated 06.03.2025 <letermined the total income of Rs.48,86,37,627 /- as against Nil income raising a demand of Rs.25,86,36,931/-. Being aggrieved, the petitioner preferred an appeal against the said assessment order before

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the Commiss,ioner of Income Tax (Appeals), Neitional Faceless Appeal Centr-- (NFAC), which is pending. As pt:r the Assessing Olficer at parrr 3.3.3 ol the order dated 06.03.2025, the addition

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has been macie for the sole reason, rl.hich reads ;rs under:

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"Thcrelore. under these circllmstances. in the absence ,rf copy of appror.al u/s 10(23C)(r'il, the total income of tl-re assessee is assessed at Rs.48.86,37 .1i77 l- as cxernption claimed arnount for Rs.48.86,37,677/ sections l2Al12AE l3s(1)(ii)/(iia)/(iii), lO(23C) is disalloived for the releva;rt ycar.''

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The peti ioner therefore has corrtested tlre addition as factually incorrect. According to the petitioner, since the assessment is a high pitched assessment, a l)el rtion has also been filed before the High Pitched Assessment Committee on 19.06.2025. Relerring to the aforesaid facts an zroplication for stay of collectio;r o1'demand rn'as rnade belore the Llommissioner of Income Tax (F)xenrption) Hyderabacl vide application dated 20.08.2025 till^,lisposal of the^{appeal u'hich has been rejected} by the impugnerl order

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It is subnritted that^{the Commissionerof IncomeTax} (Exemption) Hyrlerabad has by a^{cryptic order directed the} petitioner to pa1 an amount^{of Rs.3,87,00,000} /^{- on or before} Oa.Og.2O25 by order^{dated 30.08 .2025and produce copiesof}

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\ \

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cha-llans before the Assessing Officer failing which the Assessing Officer will be at liberty to initiate coercive recover' proceedings undcr SecLio n 226(3) of the Act r.r'ithout anv lurther communicatior-r. It is submitted that respondent No.2Commissioner of Incorne Tax fExemptions) has not dealt r,r'ith any of the grounds urged for sta1, 6; the demand. Therefore, the petitioner being aggrievecl has approached this Court.

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Learned counsel for the respondents has supported the impugned order. It is submitted that respondent No. t has taken into consideration the decisions rendered by the jurisdictional High Courts and held it to be applicable to the facts and circumstances of the case of the petitioner. Therefore, no blanket stay of the demand has been granted. The petitioner has instead been asked to deposit Rs.3,87,0O,OO0/- as per Corrigendum dated 15.09.2025. However, learned counsel for the respondents has not been able to dispute that the specilic grounds urged by the petitioner in the stay application have not been dealt with by respondent No.2 - Commissioner of Income Tax (Exemptions) in the impugned order.

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We have considered the submissions of the learned counsel for the parties

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B. The irnpugned order has been quoted ht-'r'einabove. The arc grounds urqei by thc pctitioner in the star :-pplication annexed to th: writ affidavit. As noted above, rr'spondent No.2 has failed to deal u.ith thc specific grouncls urged by the petitioner in -he impugned order, except rcl-r rng upon the decision of thi,s Court antl the High Court of Andhra Pradesh u,hich, in hisr opinion, rlere reler':rnt to tltc lacts and circumstances of the case of tl-re petitioner. As such, u'e are of the opinion that the impugned order lacks reason s and application ol mind to the specific grounds trrged by the petitioner in the sta1, application-

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9 - In that vie'w of the trratter, 'r,'e are inclined^{to remit the} matter to respondent No.2 to take a^{fresh decisiorl on the stay} application of the petitioner in^{accordance u'ith liru' within a} period of four weeks from the^{date of receipt of a copy of this} order, after givrng an^{opportunity ofbeing heard tothe} petitroner'^{The rmPugnedorder, dated3O'O8'2O25 read rvith} 15.09.2025^{',is a ccordinglY set aside'}

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disposed^ofHor'r'ever ' 10. The^{writ petition is accordingly}

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there^{shall be no order as to costs'}

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Miscellaneous^{applicationspending'ifan.v, shall stanC}

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closed.

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SD/ SRINIVASA REDDY ISTANT REGIST

//TRUE COPY//

SECTION OFFICER

To,

The Assessment Unit, lncome^{Tax Department,Na} I e- Assessment Center, Room No.401 , 2ndFloor,^{E-Ramp,Jawaha} N ehru Stadium,^New Delhi-'l 10 003.

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The Commissioner of lncome Tax^{(Exemptions),2nd Floor,AayakarBhavan,} Basheerbagh, Hyderabad, Telangana.

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The Principal Chief Commissioner of lncome Tax (Exemptions), R.No 2504, E-2, Block 25th Floor, Civic Centre, New Delhi.

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The Secretary, Union of lndia, lvlinistry of Finance, Government of lndia, North Block, New Delhi-1 10 001.

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5 One CC to Ms. AKRUTI AGARWAL Advocate [OPUC] 6 One CC to SRl. VIJHAY K PUNNA Advocate IOPUC] 7 One CC to SRl. N. BHUJANGA RAO. DY. SOLICITOR GENERAL OF INDIA loPUCl

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