IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.K.ABDUL REHIM THURSDAY, THE 3RD DECEMBER 2009 / 12TH AGRAHAYANA 1931 WP(C).No. 34810 of 2009(U) --------------------------------------- PETITIONER(S): ---------------------- OIL PALM INDIA LIMITED, OLD STAR THEATRE ROAD, P.B. NO. 1715, KOTTAYAM SOUTH P.O., KOTTAYAM- 686 039, REPRESENTED BY ITS MANAGING DIRECTOR, SHRI K.N. RAVINDRAN. BY ADV. MR.E.K.NANDAKUMAR, MR.A.K.JAYASANKAR NAMBIAR, MR.K.JOHN MATHAI, MR.P.BENNY THOMAS, MR.P.GOPINATH, MR.RAJAKANNAN. RESPONDENT(S): ------------------------ 1. THE STATE OF KERALA, REP. BY THE SECRETARY (TAXES), GOVERNMENT OF KERALA, SECRETARIAT, THIRUVANANTHAPURAM. 2. INSPECTING ASSISTANT COMMISSIONER OF COMMERCIAL TAXES, KOTTAYAM. 3. DEPUTY COMMISSIONER OF COMMCERCIAL TAXES (APPEALS), KOTTAYAM. R1 TO R3 BY GOVERNMENT PLEADER MR.V.K. SHAMSUDHEEN. THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 03/12/2009,THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: rs. C.K.ABDUL REHIM, J. ------------------------------ W.P.(C).No.34810 OF 2009 ------------------------------ Dated this the 3rd day of December, 2009 J U D G M E N T ---------------------- 1. The crux of the dispute is regarding bifurcation of tax liability under the Income Tax Act and under the Agricultural Income Tax Act. Petitioner is a company fully owned by the State Government engaged in cultivation of Oil Palms. The fruits are being processed by the petitioner for getting Palm Oil in the crude form. Therefore Income Tax Department is raising a claim that there is activity undertaken by the petitioner which attracts tax liability. At the same time the cultivation is liable to be assessed under the provisions of the Agricultural Income Tax Act. The dispute regarding apportionment of the income is an issue with respect to the assessment for the last so many years. In the relevant year 2006-07, the petitioner apportioned more than 60% of the income as agricultural income and the rest as income for which tax is payable under the Income Tax Act. Tax amount under the respective statutes were also paid on the entire income in the proportion as stated above. But the assessment under the Agricultural Income Tax is completed as per Ext.P1 disallowing deduction claimed with respect to payment of Income Tax. The matter is now pending in statutory W.P.(C).34810/09-U 2 appeal filed before the 3rd respondent as evidenced from Ext.P3. Grievance of the petitioner is that without considering pendency of the appeal now recovery steps have been initiated pursuant to Ext.P4 notice. 2. Since statutory appeal is pending in the matter I am of the opinion that the writ petition can be disposed of on issuing necessary directions to the appellate authority. Considering the fact that the petitioner is a company fully owned by the Government I am of the opinion that the recovery steps can be directed to be kept in abeyance till the disposal of the appeal. 3. The writ petition is therefore disposed of directing the 3rd respondent to consider and pass orders on Ext.P3 appeal, after affording an opportunity of hearing to the petitioner as early as possible, at any rate within a period of two months from the date of receipt of a copy of this judgment. 4. The respondents are directed to keep in abeyance realisation of the amounts covered under Ext.P1 which is initiated pursuant to Ext.P4 notice till a decision is taken by the appellate authority, as directed above. C.K.ABDUL REHIM, JUDGE. okb