Appeal Pending against Assessment order passed under Income Tax Act: Kerala HC directs to consider Stay Petition [Read Order]

The Kerala High Court directed to consider the stay petition on the ground that the appeal was pending against the assessment order pass under Income Tax Act, 1961.

Against the assessment order issued by the 1st respondent for the assessment year 2016-17, the petitioner has preferred the appeal before the 2nd respondent. The petitioner has also preferred the stay petition. The grievance of the petitioner is that pending the appeal, coercive steps have been taken by the respondents for realisation of the dues as per the assessment order.

The order issued to an assessee by one of the assessing officers of the income tax department is known as an income tax assessment order. It is the foundation of all proceedings under the IT Act. The amount that the assessee is eligible to receive back or is required to pay for any previous fiscal year is accurately determined in this order. Hence, the assessing officer must be given all of the information to make a well-judged assessment order.

According to the Income Tax Law, there are four main assessments:

• Assessment under section 143(1): In this summary assessment, the taxpayer is not called. Assessment under this section is a preliminary review of an income tax return that does not involve any thorough examination.
• Assessment under section 143(3): Also known as scrutiny assessment, this is a detailed assessment to verify the accuracy and legitimacy of the taxpayer’s claims, deductions, etc.
• Assessment under section 144: Based on all the pertinent information, the assessing officer completes this assessment in their best judgement.
• Assessment under section 147: The income escaping assessment is issued when one of the following occurs:
  • The assessee submits an income tax return for the relevant time period after the deadline for the same has passed.
  •  The assessing officer is dissatisfied with the filed tax returns owing to reasons outlined in the assessment order.

A Single Bench of Justice Murali Purushothaman observed that “Since there is a statutory appeal, there will be a direction to the 2nd respondent to dispose of the stay petition as expeditiously as possible, at any rate, within a period of two months from the date of receipt of a copy of this judgment. Till such time the stay petition is disposed of, there will be stay of recovery proceedings against the petitioner.”

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