Recovery Cum Garnishee Orders on Hold as Petitioner Proposes Depositing 20% of Assessed Tax; Kerala High Court Directs Appellate Authority to Condone Delay and Expedite Adjudication [Read Order]

The High Court of Kerala has directed the petitioner to deposit 20% of the assessed tax amount within one month to put the recovery cum garnishee orders on hold. The court insisted the appellate authority not to enforce the recovery cum garnishee orders upon the petitioner depositing the amount. The appellate authority was also directed to condone the delay of 433 days and to expedite the adjudication proceedings in accordance with the law.

The decision came in response to the writ petition filed by the petitioner, P R Combines, challenging the recovery orders issued by the Assistant Commissioner of Income Tax, Central Circle 1, Kozhikode. These orders were issued to recover the assessed tax amount as per the assessment orders.

The petitioner, P R Combines, represented by its partner K N Gopalakrishnan, had filed statutory appeals against the assessment orders, with a delay of 433 days. At the time of filing this petition, the delay had not been condoned and the appeals had not been admitted by the Commissioner of Income Tax (Appeals), the second respondent in the case.

However, during the pendency of the applications seeking the condonation of the appeal filing delay, the Assistant Commissioner issued recovery cum garnishee orders. These orders aimed to recover the assessed tax amount from the petitioner.

The petitioner, represented by R. Jaikrishna, Narayani Harikrishnan, C.S. Arun Shankar and Anish P proposed to deposit 20% of the assessed tax amount as a sign of their willingness to comply with the tax liability. This deposit would be subject to the final outcome of the appeals. The petitioner requested that the recovery cum garnishee orders not be enforced while the appeals were under consideration.

The respondent revenue, represented by Sri. Jose Joseph and Sri. Sandeep Ankarath did not object to this proposal by the petitioner.

The single bench of Justice Dinesh Kumar Singh disposed of the writ petition and issued a specific direction to the petitioner to deposit 20% of the assessed tax amount within one month from the date of the judgment.

The appellate authority was instructed to proceed with the applications for condoning the delay in filing the appeals and the appeals themselves expeditiously in accordance with the law.

The bench also put the recovery cum garnishee orders on hold until the appellate authority concludes its review. This means that the recovery process will remain suspended as long as the petitioner complies with the court’s directive to deposit 20% of the assessed tax amount within the stipulated one month timeframe.

The bench insisted that the recovery process shall not be enforced until the appellate authority reviews the case and decides on the condonation of delay in filing appeals.

The bench made it clear that its judgment did not express any opinion on the merits of the case. The decision primarily focused on ensuring due process and providing the petitioner with an opportunity of being heard.

To Read the full text of the Order CLICK HERE

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