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TMI Blog2018 (7) TMI 1625X X X X Extracts X X X X X X X X Extracts X X X X ..... dated 31.12.2017 for both the Assessment years, namely 2009-10 and 2010-11 are unduly high pitched and in such situation, the Central Board has clarified as early as in the year 1969 that the collection of disputed demands should be stayed till the appeals are heard and disposed of. In this regard, reliance was placed on Instruction No.96 dated 21.08.1969. It is further submitted that the show-cause notice dated 15.12.2017 as well as the Assessment Orders dated 31.12.2017 are mirror images of the Charge sheet laid by the Central Bureau of Investigation (CBI) before the Special Court and the persons cited as accused in the said case have been acquitted by the said Court, by judgment dated 21.12.2017. The Assessee had produced the copy of the judgment before Assessing Officer. Yet, the Assessing Officer has failed to take note of the same and has completed the assessment. As against the Assessment Orders, the petitioner has preferred appeals to the Commissioner of Income Tax (Appeals) on 23.02.2018 and the appeals are pending. A notice of demand dated 21.02.2018 was issued demanding a sum of Rs. 12,66,66,300/- for the Assessment year 2009-10 and Rs. 79,90,55,680/- for the Assessment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the order pertains to the Assessment year 2011-12, the factual position, which was pleaded before this Court in this writ petition, is no different from W.P.No.13624 of 2018 and the Court may not interfere with the impugned order. 6. Further it is submitted the order passed by the second respondent is a reasoned order and the petitioner was directed to pay only 20% of the disputed tax and hence, the impugned order does not call for interference. Further it is submitted that Instruction No.96 dated 21.08.1969 has been superseded by Instruction No.1914 dated 22.12.1993 and therefore, 1969 instruction cannot be relied upon. Further by referring to the counter affidavit filed by the second respondent, it is submitted that the Assessing Officer, after examining various materials in his possession and after considering all the submissions of the assessee, came to the conclusion that a sum of Rs. 25 Crores was unexplained for the assessment year 2009-10 and a sum of Rs. 175 Crores was unexplained for the assessment year 2010-11. The Assessing officer was not satisfied with regard to the nature and source of Rs. 200 Crores. It is further submitted that in any case, the matter is pending b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be argued that there is no case in the income-tax assessment proceedings. Further it is stated that the assessment is not merely based upon CBI charge sheet and it also takes into account such other materials as discussed in the assessment order. 9. As pointed out earlier, the second respondent has not given any reason as to why in his opinion the assessment is not high pitched. With regard to the other statement of law which has been mentioned there, can be of no quarrel or no doubt that the said Income tax proceedings are civil in nature and strict rule of evidence are not applicable. However, the applicability of general preposition to the case on hand is required to be seen. The prima facie examination required is, as to whether there can be any impact on the income tax proceedings on account of the acquittal in the criminal proceedings. 10. This Court perused the show-cause notice dated 15.12.2017. In the show-cause notice, there is substantial reference to the averments set out in the charge sheet filed by the CBI. The petitioner had submitted their reply to the show-cause notice on 26.12.2017, after which the assessment has been completed under Section 143(3) r/w.254 of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the order reads as follows: 16.It is the contention of the learned counsel for the petitioner that pending the appeal, the petitioner is entitled for stay of recovery of the demand amount, as his case falls within the ambit of Sections 220(3) & 220(6) of the IT Act. In view of the pendency of the appeal, the respondent ought to have passed an order treating him as not being in default in respect of the amount in dispute in the appeal, by placing reliance on CBDT Instruction No.95 dated 21.08.1969. But, according to the respondent, the said CBDT Instruction No.95 was superseded and as such, the respondent has exercised his power under subsequent Instruction No.1914 dated 02.12.1993. But, the learned counsel for the petitioner, by relying upon number of judgments submitted that CBDT Instruction No.95 is still in force. 17.Therefore, it would be appropriate to refer some of the decisions in this regard. In the case of Taneja Developers & Infrastracture Ltd., Vs. Assistant Commissioner of Income Tax, Delhi & ors in W.P.(C).No.6956 of 2009, dated 24.02.2009, the Division Bench of Delhi High Court has held as follows:- '8.Relying upon the said Instruction No.1914 of 1993, Mr.Jol ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee is entitled to be treated as not being in default in respect of the amount in dispute in the appeal. In the case reported in (1997) 223 ITR 192 (Raj) [Maharana Shri Bhagwat Singhji of Mewar Vs. Income-Tax Appellate Tribunal, Jaipur Bench, and others), the Rajasthan High Court has held as follows:- "accordingly, on the facts, that the factors which are relevant for deciding the stay applications primarily are a prima facie case, balance of convenience, financial status of the petitioner, hardship and also the interest Revenue. In the instant case there was an order of the court restraining the accountable person from alienating/disposing of the properties of the estate. The value of the estate which was determined by the authority was much more than twice the returned value. Hence, the Instruction No.96 of August 21, 1969, was applicable. It was also established that the accountable person had no cash belonging to the estate. A perusal of the order of the Tribunal indicated that the contention raised by the petitioner before the Tribunal for staying the total recovery was not contraverted and no relevant and convincing material regarding the financial status of the petit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it for the fate of such appeal filed by the assessee. Therefore, his discretion of not treating the assessee in default, conferred under sub-section (6) should ordinarily be exercised in favour of assessee, unless the overriding and overwhelming reasons are there to reject the application of the assessee under Section 220(6) of the Act. The application under Section 220(6) of the Act cannot normally be rejected merely describing it to be against the interest of Revenue if recovery is not made, if tax demanded is twice or more of the declared tax liability. The very purpose of filing of appeal, which provides an effective remedy to the assessee is likely to be frustrated, if such a discretion was always to be exercised in favour of revenue rather than assessee. 53.The tendency of making high pitched assessments by the Assessing Officers is not unknown and it may result in serious prejudice to the assessee and miscarriage of justice & sometimes may even result into insolvency or closure of the business if such power was to be exercised only in a pro revenue manner. It may be like execution of death sentence, whereas the accused may get even acquittal from higher appellate forums or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Apart from that the order impugned before the Hon'ble Division Bench was an order passed by the Tribunal on a stay application and the writ petition was disposed of with a direction to the Tribunal to expedite the disposal of the appeal. Therefore, in my considered view, the decision of the Hon'ble First bench does not render much support to the case of the Revenue. 14. In the light of the above discussion, this Court is of the view that the prima facie effect of the judgment of the Special Court was required to be considered by the second respondent while examining the prayer for stay. Further, the impugned order states that no such situation has been contemplated in the CBI Instruction No.1914. In my considered view the instruction issued by the Board are illustrative and not exhaustive. The instruction itself was issued to bring about uniformity in the manner in which the stay petitions have to be dealt with by the Assessing Officers. Even in the said instruction, discretion has been given to the Assessing Officer to impose conditions which are just and proper. Therefore, to state that CBDT instruction does not cover facts and circumstances like the assessee's cas ..... 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