TMI Blog2021 (4) TMI 609X X X X Extracts X X X X X X X X Extracts X X X X ..... he is of the view that deposit order of a higher amount than 20% pending appeal is warranted. Thus the order impugned in this writ petition is liable to be set aside as it is absolutely non-speaking. It is true that as pointed out by the learned standing counsel, the stay petition filed by the petitioner is equally bald and bereft of details. But as observed in Kannammal's case [ 2019 (3) TMI 1 - MADRAS HIGH COURT] , the assessing officer ought to be pro-active. The statutory provision will come into play only if an appeal has been filed before the appellate authority. The case of the assessee would definitely be projected in the appeal memorandum. Therefore, in the light of the stand taken in the appeal memorandum, the Assessing Officer can pass order by applying the trinity principles. The petition under Section 220(6) of the Act will have to be filed only before the assessing officer after filing the statutory appeal. The learned standing counsel claim that at present the assessees are indiscriminately filing the stay petitions. They move the appellate authority, the assessing officer and also the Principal Commissioner of Income Tax simultaneously. The Principal C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the petitioner reiterated all the contentions set out in the affidavit filed in support of the writ petition. Her foremost contention is that the first respondent had erred in not taking into account the Office Memorandum bearing F.No.1/6/69/-ITCC, dated 21.08.1969. Relying on the decision of the Madras High Court reported in [2019] 413 ITR 390(Mad) (Kannammal vs. Income Tax Officer, Ward 1(1), Tirupur), she contended that the parameters laid down for consideration of a stay application have also been totally ignored. She also contended that the impugned order is vulnerable in view of its non-speaking nature. 3.The learned standing counsel for the first respondent would submit that the impugned order is in conformity with the latest circular issued by the Central Board of Direct Taxes vide Office Memorandum (F.No. 404/72/93-ITCC), dated 31.07.2017 r/w. O.M No.404/72/93- ITCC dated 29.02.2016. Since certain substantial questions were raised, I requested Shri.N.Dilipkumar, the learned standing counsel also to assist this Court. 4.I carefully considered the rival contentions and went through the materials on record. The petitioner challenges the order passed by the Assessing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dispute should be held in abeyance till the decision on the appeal provided there were no lapses on the part of the assessees. 3.The Board desire that the above observations may be brought to the notice of all the Income-tax Officers working under you and the powers of stay of recovery in such cases up to the stage of first appeal may be exercised by the Inspecting Assistant Commissioner/Commissioner of Income-tax. There was a modification of the same vide Instruction No. 1914 dated 02.12.1993. It reads as follows : SECTION 220 OF THE INCOME TAX ACT, 1961 COLLECTION AND RECOVERY OF TAX WHEN TAX PAYABLE AND WHEN ASSESSEE DEEMED IN DEFAULT RECOVERY OF OUTSTANDING TAX DEMANDS INSTRUCTION NO.1914, DATED 02.12.1993 COLLECTION AND RECOVERY : 1.The Board has felt the need for a comprehensive instruction on the subject of recovery of tax demand in order to streamline recovery procedures. This instruction is accordingly being issued in supersession of all earlier instructions on the subject and reiterates the existing Circulars on the subject. 2.The Board is of the view that, as a matter of principle, every demand should be recovered as soon as it becomes due. Demand m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... illustrative situations where stay could be granted are: (a)If the demand in dispute relates to issues that have been decided in assessee's favour by an appellate authority or court earlier ; or (b)if the demand in dispute has arisen because the Assessing Officer had adopted an interpretation of law in respect of which there exist conflicting decisions of one or more High Courts (not of the High Court under whose jurisdiction the Assessing Officer is working); (c)if the High Court having jurisdiction has adopted a contrary interpretation but the Department has not accepted that judgment. It is clarified that in these situations also, stay may be granted only in respect of the amount attributable to such disputed points. Further, where it is subsequently found that the assessee has not co-operated in the early disposal of appeal or where a subsequent pronouncement by a higher appellate authority or court alters the above situation, the stay order may be reviewed and modified. The above illustrations are, of course, not exhaustive. ii. In granting stay, the Assessing Officer may impose such conditions as he may think fit. Thus he may, (a)require the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the CCITs/CITs. 3. The Board desires that appropriate action is taken in the matter of recovery in accordance with the above procedure. The Assessing Officer or the TRO, as the case may be, and his immediate superior officer shall be held responsible for ensuring compliance with these instructions. 4.This procedure would apply mutatis mutandis to demands created under other direct taxes enactments also. The said instructions were however modified by Office Memorandum (F.No.404/72/93-ITCC), dated 29.02.2016 31.07.2017. They read as under : 6. The learned counsel for the petitioner took me through the decisions of the Delhi High Court reported in [2008] 307 ITR 103 (Delhi) (Valvoline Cummins Limited vs. Deputy Commissioner of Income Tax and Ors , [2010] 323 ITR 305(Delhi) (Soul vs. Deputy Commissioner of Income Tax) Taneja Developers Infrastructure Ltd. vs. Asst.Commissioner of Income Tax Ors.) and [2010] 324 ITR 247(Delhi) , for the proposition that failure to consider the petition in the light of the CBDT Instruction No. 95, dated 21.08.1969, would render the order passed under Section 220(6) of the Act bad in law. She pointed out that a learn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ' as well. It is only upon an application of the three factors as aforesaid that the assessing officer can exercise discretion for the grant or rejection, wholly or in part, of a request for stay of disputed demand. 9.I may also add that the Division Bench of the Bombay High Court in the decision reported in 2019 SCC OnLine Bom 8430 (General Insurance Corporation of India vs. Assistant Commissioner of Income Tax Circle 3(1)(2) and Others) has also laid down the principles which the assessing officer must bear in mind while exercising his jurisdiction under Section 220(6) of the Act. Paragraph No.10 of the said order reads as follows : 10. Before dealing with the rival submissions it would be useful to set out the parameters to be borne in mind while disposing of stay application as laid down by this Court. We refer to the following extract of the decision of this Court in Mumbai Metropolitan Region Development Authority v. Deputy Director of Income Tax (WP(L) No. 2348 of 2014) rendered on 29 October 2014 as under: - 11.We have today, disposed of another Petition bearing No. 2542 of 2014 filed by the Slum Rehabilitation Authority and set out the parameters i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ity it is vested with the public duty of protecting the interest of the Revenue while at the same time balancing the need to mitigate hardship to the assessee. Though the assessing officer has made an assessment, he must objectively decide the application for stay considering that an appeal lies against his order; the application for stay must be considered from all its facets and the order should be passed, balancing the interest of the assessee with the protection of the Revenue. The above guidelines are only illustrative and the authority concerned would have to have exercise his discretion in matters of stay on the facts of the case before him. Keeping in view of the above broad parameters we shall now examine whether the authorities have properly exercised their jurisdiction. 10.As rightly pointed out by the learned counsel for the petitioner, Letter bearing F.No.404/10/2009-ITCC dated 01.12.2009 issued by the Board even while making it clear that the 1969 circular has ceased to exist emphasized that Instruction No.1914 dated 02.12.1993 holds the field. Clause 2(C)(v) of Instruction No.1914 states that while considering an application under Section 220(6) of the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppeal without making reference to the administrative Pr.CIT/CIT. Reference of course has to be made if he is of the view that deposit order of a higher amount than 20% pending appeal is warranted. 13.The order impugned in this writ petition is liable to be set aside as it is absolutely non-speaking. It is true that as pointed out by the learned standing counsel, the stay petition filed by the petitioner is equally bald and bereft of details. But as observed in Kannammal's case, the assessing officer ought to be pro-active. The statutory provision will come into play only if an appeal has been filed before the appellate authority. The case of the assessee would definitely be projected in the appeal memorandum. Therefore, in the light of the stand taken in the appeal memorandum, the Assessing Officer can pass order by applying the trinity principles. 14.It is needless to say that the petition under Section 220(6) of the Act will have to be filed only before the assessing officer after filing the statutory appeal. The learned standing counsel claim that at present the assessees are indiscriminately filing the stay petitions. They move the appellate authority, the assessing o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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