KERALA STATE FINANCIAL ENTERPRISES LTD. Vs. NAZEER

JUDGEMENT

(1.) The Lok Ayukta on a complaint filed by Respondent No.1 held that deduction of income tax and surcharge by the Appellants - the Branch Manager and Managing Director of the Kerala State Financial Enterprises Ltd., was illegal and directed the Appellants to pay the amount deducted from the monthly rent payable to Respondent No. 1 with interest. This order is confirmed by the learned Single Judge by judgment dtd. 14/10/2015 in W.P.(C) No.24486 of 2007. The question that is raised in this appeal filed by the Appellants is as to whether the Lok Ayukta could have issued such a mandatory direction upon adjudication.

(2.) Respondent No.1 E.M. Nazeer, had constructed a shopping complex in his property in Survey No. 107 of Vithura Village by name, N.N. Arcade. The Appellant, Kerala State Financial Enterprises Ltd., had obtained a portion of the building on the first floor for functioning of its branch with carpet area of 2350 square feets at the rate of 3 per sq. ft. on 5/5/2003. Nazeer had executed a power of attorney in favour of his father, as Nazeer was leaving the country to seek employment. The Financial Enterprises treating Nazeer as a Non-Resident Indian (NRI) liable to pay income tax on the rent of 2,64,649/- due from 5/5/2003 to 5/11/2005 for 31 months with interest, paid an amount of 1,46,149/- and deducted the tax at source.

(3.) Nazeer sent a notice to the Financial Enterprises on 15/12/2005 seeking the balance rent. It was the case of Nazeer that when he approached the Financial Enterprises, its officer demanded illegal gratification for release of the amount.