2024 (5) TMI 499 - HC - Income Tax

Stay petition - interim order staying the enforcement of the demand pursuant to the respective demand notices in the light of the submission that 20% of the demand has been deposited - HELD THAT - The net effect of the submissions is that the petitioner s appeals as against the relevant assessment orders will have to be considered by the Commissioner of Income Tax Appeals -12 in the light of the Division Bench s order in 2023 (7) TMI 1164 - KARNATAKA HIGH COURT and there cannot be precipitation for recovery of the demand especially with the petitioner having deposited 20% thereof. It would not be out of place to record that where the assessment orders have been called in question by the assessees in the writ petitions on the ground of jurisdiction those writ petitions are being disposed of in the light of the Division Bench s order supra but with liberty to the concerned assessees to seek revival of the petitions in the event the Revenue succeeds in the proceedings commenced before the Hon ble Supreme Court as against the Division Bench s order. This liberty is reserved wherever apart from the ground of jurisdiction the ground such as violation of principle of natural justice and other grounds are urged. As it would be just to reserve liberty to the petitioner to seek early disposal of the pending appeals before the Commissioner of Income Tax Appeals -12. If the reason for the assessment and the present petition is the demand notices for recovery of 100% demand based on the impugned assessment orders and if 20% of the demand is already deposited it cannot be gainsaid that with the Division Bench s order there cannot be further precipitation

Summary

Issues involved: Challenge to rejection of application for stay during pendency of appeals against assessment orders for years 2009-10, 2010-11, and 2011-12. Dispute regarding taxability of amounts received from M/s. Vodafone Idea Limited.

Judgment Summary:

Issue 1: Rejection of application for stay during pendency of appeals
The petitioner challenged the rejection of their application for stay during the pendency of appeals against assessment orders for the years 2009-10, 2010-11, and 2011-12. The Court granted an interim stay on enforcement of the demand based on the submission that 20% of the demand had been deposited.

Issue 2: Taxability of amounts received from M/s. Vodafone Idea Limited
The dispute centered around whether amounts received by the petitioner from M/s. Vodafone Idea Limited could be charged to tax. The petitioner's counsel argued that a Division Bench decision had already opined that such receipts would not be chargeable to tax. The petitioner filed applications for early hearing of their appeals against the assessment orders, pending before the Commissioner of Income Tax [Appeals]-12.

Resolution:
The Court noted that the petitioner's appeals must be considered in light of the Division Bench's decision. It directed the authorities not to precipitate the demand based on the assessment orders, allowing the petitioner to seek a refund of 20% of the tax deposited pending the outcome of the appeals.

Conclusion:
The Court reserved liberty for the petitioner to request the Commissioner of Income Tax [Appeals]-12 to expedite consideration of the case in line with the Division Bench's decision. It ordered the respondents not to take coercive measures to enforce the demand until such consideration is made. The judgment aimed to ensure a fair review of the assessment orders and protect the petitioner's rights pending the appeal process.