TMI Blog1995 (1) TMI 128X X X X Extracts X X X X X X X X Extracts X X X X ..... nder section 10(14) of the Income-tax Act and, therefore, not part of salary. Such was the position for the past several years and amendment of section 10(14) introduced with effect from 1-4-1989 has not made any difference. Alternatively the Airlines contends that such allowances are exempt under section 10(14) of the Income-tax Act. Reliance in this connection is placed on letter dated 30th March, 1990 of CBDT issued in the case of Air India. On being convinced that the Airlines failed to deduct proper tax at source, the Assessing Officer passed orders under sections 201(1) and 201 (1A) of the Income-tax Act calling upon the Airlines to pay tax and interest for short deduction of taxes from salaries by not including allowances mentioned above in the financial years 1989-90 to 1992-93. The total demand raised on above account, as per the applicant, aggregates to Rs. 10,83,00,784 (as mentioned in Stay Application No. 30/Del./ 95). 3. The applicant impugned orders made under sections 201(1) and 201 (1A) of the Act in appeal before CIT(A)-V, New Delhi. After considering the correspondence exchanged between the parties on the subject, relevant notifications issued by the CBDT, provi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Prasad Pal, learned senior counsel for the Airlines and Shri Abrar Ahmed and Assessing Officer for the Revenue. Dr. Devi Pal contended that power of the Tribunal to grant stay of recovery of demand was not affected on account of directions of Hon'ble Supreme Court in the case of Oil and Natural Gas Commission . In this connection, Dr. Devi Pal drew our attention to Circular dated 24th January, 1994 issued by the Cabinet Secretariat to comply with above decision and providing procedure for filing of petitions before High Power Committee. A copy of said Circular was placed before us. He submitted that in terms of the aforesaid circular, the petitioner has already approached the High Power Committee for grant of clearance to pursue the matter in the Appellate Tribunal. However, order of Hon'ble Supreme Court or that of Hon'ble High Court could not affect statutory powers of the Tribunal to stay recovery of taxes and advance ends of substantial justice in deserving cases before it. The Tribunal was in seisin of the matter and could exercise its statutory powers and grant stay of demand. Dr. Devi Pal drew our attention to observations of Hon'ble Supreme Court in the case of ITO v. M.K. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts of the Appellate Tribunal to record satisfaction about deserving nature of assessee's claim of getting a stay order. Dr. Devi Pal accordingly prayed that appropriate relief, as prayed for, be granted. 10. The submissions advanced on behalf of applicant were opposed by learned Departmental Representative. The learned DR and the Assessing Officer in the written note gave details of various notices issued by them to the Airlines after passing of orders under sections 201(1) and 201(1A). Copies of such notices were placed on record. In spite of aforesaid notices, the assessee did not make any payment. The assessee tried to avoid payment of taxes and, therefore, garnishing notices had to be issued to the State Bank of India. It was wrong to contend that copy of garnishing notice was not served on the assessee. The said notice was duly served on 29th December, 1994 itself. The Departmental Representative further contended that through misrepresentation, the applicant obtained stay order from the Hon'ble Delhi High Court. It was wrong to state that CIT(A) had set aside orders passed under sections 201(1) and 201(1A) of the Income-tax Act. In fact, to pass consequential order in the l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... can grant stay of recovery of demand in deserving cases by passing an appropriate order. 13. In the case of Oil and Natural Gas Commission their Lordships of Supreme Court expressed happiness when the Cabinet Secretary of the Government of India took proper initiative to settle a dispute between the Government Department and the Public Undertaking of Union of India. Their Lordships took note of the following report of the Cabinet Secretary : " I would also like to state that the Government respects the views expressed by this Honourable Court and has accepted them that public undertakings of Central Government and the Union of India should not fight their litigation in Court by spending money on fees on counsel, court fees, procedural expenses and wasting public time. It is in this context that the Cabinet Secretariat has issued instructions from time to time to all Departments of the Government of India as well as to public undertakings of the Central Government to the effect that all disputes, regardless of the type, should be resolved amicably by mutual consultation or through the good offices of empowered agencies of the Government or through arbitration and recourse to li ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the lodging of an appeal before any Court or Tribunal so as to save limitation but before such filing every endeavour should be made to have the clearance from the Committee. In the next para (iii) which is relevant for our purpose, it is provided as under :-- " (iii) Whenever appeals/petitions etc., are filed without the clearance of the High Power Committee, so as to save limitation, the appellant or the petitioner, as the case may be, shall within one month from such filing, refer the matter to the High Power Committee, with prior notice to the designated authority in Cabinet Secretariat [Under Secretary (Co-ordination)] authorised to receive notices in that behalf. The reference shall be deemed to have been made and become effective only after the notice of the reference is lodged with the Under Secretary (Co-ordination) in the Cabinet Secretariat. The reference shall be deemed to be valid if made in the case of Union of India by its Secretary, in the Ministry of Finance, Department of Revenue and in the case of Public Sector Undertakings by its Chairman, Managing Director or Chief Executive, as the case may be. It is only such reference to the Committee is made in the manner ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Committee was made on 25-1-1995. No satisfactory reply could be given by the learned DR. 15. Having regard to the clear provision of Circular dated 24-1-1994 suspending operation of order under challenge with the High Power Committee, there is no need, in our opinion, to pass any stay order relating to recovery of demand disputed in reference before the High Power Committee. There is nothing before us to indicate that Assessing Officer or other officers of the department would act in defiance of assurances of Cabinet Secretary and directions of Hon'ble Supreme Court and in spite of pending reference before the High Power Committee, the demand in dispute would not be treated as suspended after 25-1-1995. Therefore, it is not necessary for us as at present, to pass any order of stay in this case . The orders of the Assessing Officer are treated as suspended unless High Power Committee decides otherwise. We hope that both the parties would approach the High Power Committee for resolving the issue expeditiously. The applicant or the Revenue can approach this Appellate Tribunal if so warranted by future events and facts and circumstances of the case. With the aforesaid observations, t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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