KERALA STATE BEVERAGES (MANUFACTURING & MARKETING) CORPORATION LTD. Vs. ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 1(1), THIRUVANANTHAPURAM

JUDGEMENT

(1.) Petitioner is an assessee under the Income Tax Act ('the Act') on the rolls of the first respondent. The self assessment made by the petitioner under the Act for the assessment year 2015-16 was revised under Section 143(3) of the Act by the assessing officer in terms of Ext.P3 order. Ext.P4 is the appeal preferred by the petitioner before the second respondent challenging Ext.P3 order and Ext.P5 is the stay petition preferred by the petitioner in Ext.P4 appeal. Ext.P5 stay petition has now been disposed of by the second respondent in terms of Ext.P9 order granting the petitioner the stay sought by them, on condition that they shall pay 20% of the outstanding demand in four equal monthly instalments. Petitioner is aggrieved by the condition imposed on them in terms of Ext. P9 order.

(2.) Heard the learned counsel for the petitioner as also the learned Standing Counsel for the respondents.

(3.) While completing the assessment of the petitioner for the relevant year, in terms of Ext.P3 order, the assessing officer disallowed the deductions made by the petitioner towards (I) Gallonage fee amounting to Rs. 54,83,87,000/-, (ii) Licence fee amounting to Rs. 5,75,000/-, (iii) Shop license fee amounting to Rs. 199,71,00,000/- and (iv) Surcharge on sales tax amounting to Rs. 551,61,01,115/-, on the ground that they are exclusive levies on the assessee by the State Government. The petitioner maintains that the aforesaid levies are not exclusive levies falling within the scope of Section 40(a)(iib) of the Act and therefore, the assessing officer was not justified in disallowing the deductions made on the aforesaid heads. It is on that basis, the petitioner has challenged Ext.P3 order in appeal. The question whether the levies referred to in Ext.P3 order are exclusive levies on the assessee by the State Government is a question to be considered by the appellate authority at the time of final disposal of the appeal. It is taking the said view, the appellate authority granted a conditional stay to the petitioner. The question arises for consideration is whether the appellate authority is justified in imposing the said condition while granting the stay sought by the petitioner.