Kalaignar TV Private Limited v. The Principal Commissioner of Income-tax-10, Chennai / The Assistant Commissioner of Income-tax, Chennai / The Commissioner of Income-tax (Appeals)-14, Chennai
[Citation -2017-LL-1026-8]

Citation 2017-LL-1026-8
Appellant Name Kalaignar TV Private Limited
Respondent Name The Principal Commissioner of Income-tax-10, Chennai / The Assistant Commissioner of Income-tax, Chennai / The Commissioner of Income-tax (Appeals)-14, Chennai
Court HIGH COURT OF MADRAS
Relevant Act Income-tax
Date of Order 26/10/2017
Judgment View Judgment
Keyword Tags private limited company • disposal of appeals • subsidiary company • broadcasting • financial hardship
Bot Summary: Respondents PETITIONS under Article 226 of The Constitution of India praying for the issuance of a Writ of Certiorarified Mandamus to call for the records of the first respondent, quash the impugned order bearing F.No. The learned counsel for the petitioner would submit that the impugned order passed by the first respondent is erroneous, since the first respondent did not consider the three cardinal principles, which are required to be taken note of while passing an interim order namely prima facie case balance of convenience and irreparable hardship. According to the learned counsel, the petitioner received trade advances to the tune of Rs.129 Crores from three companies and those are towards advertisements and as and when the accrual takes place and invoices are raised, tax is being paid and out of Rs.129 crores, a sum of Rs.125 Crores has been shown in the return of income filed by the petitioner. With regard to the prayer sought for by the petitioner to direct the appeals to be disposed of at an early date, the learned Standing Counsel has produced written instructions given by the third respondent dated 24.10.2017 wherein he stated that he would require at least six months to dispose of the appeals i.e at least till the end of April 2018. After carefully considering the submissions made on either side and upon perusing the materials placed on record, this Court finds that the contentions advanced before this Court in the first writ petition were never pleaded before the first respondent while arguing the stay petition. After the impugned order was passed, which is based on the concession given by the first respondent, once again, the petitioner approached the first respondent by way of representation dated 05.7.2017 expressing their financial difficulties and seeking stay of the collection of taxes. The dismissal of the writ petition will not preclude the petitioner from approaching the first respondent with a better offer and it is for the first respondent to consider the same and proceed in accordance with law.


In High Court of Judicature at Madras Dated : 26.10.2017 Coram : Honourable Mr.Justice T.S.SIVAGNANAM Writ Petition Nos.27209 & 27210 of 2017 & WMP.No.29079 of 2017 Kalaignar TV Private Limited, rep. by its Director Mr.P.Amirtham ...Petitioner Vs 1.The Principal Commissioner of Income Tax-10, Room No.410, 4th Floor, Main Building, No.121, M.G.Road, Nungambakkam, Chennai-34. 2.The Assistant Commissioner of Income Tax, Non Corporate Circle 20(1), M.G.Road, Nungambakkam, Chennai-34. 3.The Commissioner of Income Tax (Appeals) - 14, Room No.227, II Floor, M.G.Road, Nungambakkam, Chennai-34. ...Respondents PETITIONS under Article 226 of Constitution of India praying for issuance of (i) Writ of Certiorarified Mandamus to call for records of first respondent, quash impugned order bearing F.No.10601(4)/2016-17 PCIT - 10 dated 27.3.2017 issued by first respondent and direct respondents not to enforce arrears of demand against petitioner http://www.judis.nic.in 2 pending disposal of appeals before third respondent (WP.No.27909 of 2017); and (ii) Writ of Mandamus directing third respondent to dispose of appeals bearing ITA.Nos.24/2014-15, 98/2015-16 and 83/2016-17 for assessment years 2011-12, 2012-13 and 2013-14 respectively at earliest (WP.No.27910 of 2017). For Petitioner : Mr.Sandeep Bagmar For Respondents : Mr.J.Narayanaswamy COMMON ORDER Mr.J.Narayanaswamy, learned Standing Counsel accepts notice for respondents. Heard both. 2. petitioner, which is private limited company incorporated under Companies Act, 1956, is engaged in business of broadcasting of Tamil channels through television. 3. In W.P.No.27209 of 2017, petitioner challenges order passed by first respondent dated 27.3.2017, by which, first respondent, while rejecting petitioner's prayer for stay of entire demand as quantified by Assessing Officer in assessment orders for years 2011-12 and 2012-13, accepted offer given by petitioner to pay at rate of Rs.50 lakhs per month till 15% of demand is collected or first appeal http://www.judis.nic.in 3 is decided, whichever is earlier. 4. As against assessment orders for those two years, petitioner filed appeals before third respondent. It appears that appeal petitions were to be heard by third respondent and first hearing notice was issued on 14.2.2017 for three assessment years namely 2011-12 to 2013-14 and petitioner is stated to have appeared along with their authorized representative on 23.2.2017, on which date, case was adjourned and till date, no fresh date of hearing has been assigned. Therefore, in W.P.No. 27210 of 2017, petitioner has sought for direction to third respondent to dispose of appeals pending on his file for three assessment years 2011-12 to 2013-14. 5. learned counsel for petitioner would submit that impugned order passed by first respondent is erroneous, since first respondent did not consider three cardinal principles, which are required to be taken note of while passing interim order namely (i) prima facie case (ii) balance of convenience and (iii) irreparable hardship. 6. On merits, learned counsel for petitioner would submit that http://www.judis.nic.in 4 they had received loan from subsidiary company - M/s.Anjugam Enterprises to tune of Rs.83 Crores and suffered taxes at hands of subsidiary company, which, in turn, had received said amount from M/s.Sapphire Media & Infrastructure Limited, at whose hands also, they suffered tax and that therefore, once again, same amount cannot be taxed at hands of petitioner. According to learned counsel, petitioner received trade advances to tune of Rs.129 Crores from three companies and those are towards advertisements and as and when accrual takes place and invoices are raised, tax is being paid and out of Rs.129 crores, sum of Rs.125 Crores has been shown in return of income filed by petitioner. It is further submitted that so far as assessment year 2008-09 is concerned, petitioner is entitled to refund of Rs.12,90,960/- and this has not been adjusted by Department. 7. assessments for years 2009-10 and 2010-11 were set aside by Income Tax Appellate Tribunal and matters have been remanded to second respondent - Assessing Officer. Therefore, it is also submitted that these amounts have be eschewed from total demand and this aspect of matter was not considered by first respondent. 8. However, learned Standing Counsel for Revenue would contend that factual issues cannot be adjudicated by this Court at this http://www.judis.nic.in 5 juncture and those are all issues, which have to be agitated before Appellate Authority. learned Standing Counsel has referred to certain observations made by Assessing Officer to support their stand that transactions effected by petitioner are, in effect, circular transactions. 9. With regard to prayer sought for by petitioner to direct appeals to be disposed of at early date, learned Standing Counsel has produced written instructions given by third respondent dated 24.10.2017 wherein he stated that he would require at least six months to dispose of appeals i.e at least till end of April 2018. 10. After carefully considering submissions made on either side and upon perusing materials placed on record, this Court finds that contentions advanced before this Court in first writ petition were never pleaded before first respondent while arguing stay petition. In fact, assessee's submissions were extracted in impugned order, from which, it is seen that assessee, in unequivocal terms, agreed that they are prepared to pay Rs.50 lakhs by 25th of every month till appeal before Commissioner is decided. assessee was confident that appeal will be decided in their favour and that tax paid will be refunded to them. These submissions were taken note of by first respondent and order to said effect was passed permitting petitioner to pay arrears in http://www.judis.nic.in 6 monthly instalments of Rs.50 lakhs till 15% of demand is collected. Assessing Officer was directed to withdraw attachment of assessee's bank accounts and debtors attachments. However, petitioner did not keep up their commitment and they were able to pay only sum of Rs.3.5 Crores. 11. After impugned order was passed, which is based on concession given by first respondent, once again, petitioner approached first respondent by way of representation dated 05.7.2017 expressing their financial difficulties and seeking stay of collection of taxes. This representation is now pending. Subsequently, another representation has been given on 20.9.2017 seeking to pay Rs.20 lakhs per month instead of Rs.50 lakhs. However, this representation dated 20.9.2017 has been rejected by proceedings dated 03.10.2017. But, proceedings dated 03.10.2017 has not been challenged by petitioner. 12. Thus, this Court finds that when petitioner had agreed to comply with payment of disputed tax at rate of Rs.50 lakhs per month, they are bound to comply with such undertaking. Now arguing before this Court pleading their financial incapacity or requesting this Court to examine merits of assessment is unsustainable, as this Court finds that there is no error in impugned order. http://www.judis.nic.in 7 13. Accordingly, W.P.No.27209 of 2017 is dismissed. No costs. Consequently, connected WMP is also dismissed. However, dismissal of writ petition will not preclude petitioner from approaching first respondent with better offer and it is for first respondent to consider same and proceed in accordance with law. 14. With regard to time required for disposal of appeals, bearing in mind request made by third respondent vide letter dated 24.10.2017, third respondent is directed to expedite disposal of appeals preferably on or before 15.3.2018. W.P.No.29210 of 2017 is disposed of in above terms. No costs. 26.10.2017 Internet : Yes To 1.The Principal Commissioner of Income Tax-10, Room No.410, 4th Floor, Main Building, No.121, M.G.Road, Nungambakkam, Chennai-34. 2.The Assistant Commissioner of Income Tax, Non Corporate Circle 20(1), M.G.Road, Nungambakkam, Chennai-34. 3.The Commissioner of Income Tax(Appeals) - 14, Room No.227, II Floor, M.G.Road, Nungambakkam, Chennai-34. RS http://www.judis.nic.in 8 T.S.SIVAGNANAM,J RS WP.Nos.27209 & 27210 of 2017 and WMP.No.29079 of 2017 26.10.2017 http://www.judis.nic.in Kalaignar TV Private Limited v. Principal Commissioner of Income-tax-10, Chennai / Assistant Commissioner of Income-tax, Chennai / Commissioner of Income-tax (Appeals)-14, Chennai
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