In a recent ruling, the Madras High Court bench of Justice P T Asha stated that the petitioner company must be permitted to show their bona fides and settle the dues. With this intent and in the interest of justice, the writ petition was allowed permitting the petitioner to pay the amount in installments.
The court ordered the petitioner to pay the income tax department in 11 payments. It was also indicated that failure to pay even one of the instalments would result in the termination of the petitioner’s concession.
The petitioner company Mahalakshmi Textile Mills Limited filed the writ petition through its director for the issue of a writ of mandamus directing the respondent to allow the petitioner company to pay the sum of Rs.1,00,00,000 in ten monthly instalments of Rs.10,00,000 each beginning in April 2023.
According to the facts submitted, the petitioner company had been liquidated. The official liquidator had been appointed to take responsibility of the company’s operations, and as a result, any legal proceedings initiated without first appealing to the official liquidator was null and void in the eyes of the law.
Meanwhile, the respondent, Income Tax authorities, issued an assessment order demanding Rs. 1,33,45,480 under Section 143(1)(a) of the Income Tax Act of 1961. However, the petitioner was unable to repay the sum required and requested that the dues be paid in installments, which the department agreed to do in three installments.
The bench noted that the petitioner company does not own any property that could be easily sold to satisfy the respondent’s debts in this case. Despite the odds stacked against them, the petitioner’s intention appeared to be forthright. Thus, allowed to settle the dues in installments.
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