TMI Blog1987 (2) TMI 55X X X X Extracts X X X X X X X X Extracts X X X X ..... Rs. 1,39,770 by making various additions. A copy of the order of assessment is exhibit P-1. Consequent thereon, a total amount of Rs. 71,817 was demanded as income-tax and surcharge besides Rs. 17,593 by way of interest under section 139(8) and Rs. 24,950 as interest under section 217(1)(b). The demand was thus for Rs. 1, 14,360 in the aggregate. The petitioner filed an appeal against this order before the second respondent, namely, the Commissioner of Income-tax (Appeals), Kozhikode. A copy of the appeal is exhibit P-2. It is dated November 10, 1986. The petitioner also filed an application before the second respondent praying for stay of collection of the tax pending the disposal of the appeal. He also appears to have moved the Income- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or decision before the two appellate authorities, both of whom possess plenary powers. In exercising his power, the Income-tax Officer should not act as a mere tax-gatherer but as a quasi-judicial authority vested with the power of mitigating hardship to the assessee. The Income-tax Officer should divorce himself from his position as the authority who made the assessment and consider the matter in all its facets, from the point of view of the assessee without at the same time sacrificing the interests of the Revenue. Says Viswanatha Sastri J. in Vetcha Sreeramamurthy v. ITO [1956] 30 ITR 252 (AP) (at pages 268 and 269): " The Legislature has, however, chosen to entrust the discretion to them. Being to some extent in the position of judges ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h aspect. The position and economic circumstances of the assessee is another. If the officer feels that the stay would put the realisation of the amount in jeopardy, that would be a cogent factor to be taken into consideration. The amount involved is also a relevant factor. If it is a heavy amount, it should be presumed that immediate payment, pending an appeal in which there may be a reasonable chance of success, would constitute a hardship. The Wealth-tax Act has just come into operation. If any point is involved which requires an authoritative decision, that is to say, a precedent, that is a point in favour of granting stay. Quick realisation of tax may be an administrative expediency, but by itself it constitutes no ground for refusing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessment was substantially higher than the returned income, say, twice the latter amount or more, the collection of the tax in dispute should be held in abeyance till the decision on the appeals 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 the 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." The instructions indicate the departmental thinking on the subject which is also relevant in the context of exercising the discretion under section 220(6). In this case, the assessee ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nnot run on bank guarantees or assurances, but that does not absolve the Income-tax Officer from exercising his discretion fairly, impartially and judiciously. The order, exhibit P-4, does not satisfy any of these requirements. It is apparent that the Income-tax Officer has been guided solely by considerations of collection of revenue. The order does not disclose that any factor, which is relevant, as pointed out above, has been kept in mind. Exhibit P-4 order is not at all one passed in exercise of the Income-tax Officer's discretion. It is not in accordance with law and deserves to be quashed. The appeal is still pending before the second respondent. It is also necessary to direct the second respondent to dispose of the appeal exped ..... X X X X Extracts X X X X X X X X Extracts X X X X
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