Anirudh Khemka v. The Principal Commissioner Of Income Tax-1

IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 19.12.2018 CORAM THE HON'BLE MR. JUSTICE K.RAVICHANDRABAABU W.P.No.33808 of 2018 andW.M.P.Nos.39270 & 39272 of 2018 Anirudh Khemka... Petitioner vs. 1.The Principal Commissioner of Income Tax-1 121, Mahatma Gandhi Road, Nungambakkam, Chennai – 600 034. 2.The Deputy Commissioner of Income Tax, Corporate Circle – 1 (1), 121, Mahatma Gandhi Road, Nungambakkam, Chennai – 600 034. 3.The Commissioner of Income Tax (Appeals) -1 121, Mahatma Gandhi Road, Nungambakkam, Chennai – 600 034.... Respondents Prayer : Writ Petition filed under Article 226 of theConstitution of India, praying to issue a Writ of CertiorarifiedMandamus, calling for the records in PAN: and quashthe impugned order in C.No.233/Pr.CIT-1/2018-19 dated 05.12.2018passed by the first respondent rejecting the stay petition filedby the petitioner for stay of demand for the Assessment Year2012-13 as illegal, arbitrary and devoid of merit andconsequently direct the first respondent to grant stay for theproceedings in C.No.DCIT/Cor.Cir.1(1)/Recovery/ F.Y.2016-17dated 22.02.2017 till the disposal of the appeal before thethird respondent. For Petitioner : Mr.R.Sivaraman For Respondents: Mr.Naveen Durai Babu, Standing Counsel https://hcservices.ecourts.gov.in/hcservices/ ORDER Mr.Naveen Durai Babu, learned Standing Counsel takes noticefor the respondents. By consent, this writ petition is taken upfor final disposal at the stage of admission itself. 2. The petitioner is aggrieved against the order of thefirst respondent dated 05.12.2018, in rejecting the assessee'sapplication dated 09.11.2018, seeking for stay of demand ofdisputed taxes till the disposal of the appeal by the CIT (A)-1. 3. Heard Mr.R.Sivaraman, learned counsel appearing for thepetitioner and Mr.Naveen Durai Babu, learned Standing Counselappearing for the respondents. 4.The second respondent/ Assessing Officer passed an orderof assessment under Section 143 (3) of the Income Tax Act, 1961on 26.03.2015, in respect of the assessment year 2012-13.Aggrieved over the said order, the petitioner preferred anappeal before the 3rd respondent on 07.04.2015. The petitioneralsofiledthestaypetitionbeforethesecondrespondent/Assessing Officer on 06.05.2015, seeking to stay therecovery of the disputed tax demand till the disposal of theappeal before the third respondent. The second respondent,however passed an order on 22.02.2017, calling upon thepetitioner to pay 15% of the tax demand. Thus, the petitionerpreferred an application before the first respondent seeking forstay of demand of entire disputed tax. The first respondent,however rejected the application by a single line order stating"Petition rejected. AO to collect eligible demand." Hence, thepresent writ petition is filed before this Court. 5.The learned counsel for the petitioner contended that whenthe appeal filed against the order of the assessment is stillpending before the third respondent/Appellate Authority, theorder of the first respondent in rejecting the stay petition,that too, with a further direction to the Assessing Officer tocollect the demand, is totally unreasonable and unjustifiable.He further contended that under similar circumstances, in anorder made in W.P.No.5794 of 2018 dated 05.04.2018, this Courtset aside the order passed by the Principal Commissioner ofIncome Tax and permitting the assessee to file a stay petitionbefore the Appellate Authority. 6.The learned Standing Counsel appearing for the respondentssubmitted that since the petitioner has not filed any staypetition before the Appellate Authority and failed to pay 15% ofthe tax liability as demanded by the Assessing Officer, the order of the Principal Commissioner cannot be found fault with. 6.The learned Standing Counsel appearing for the respondentssubmitted that since the petitioner has not filed any staypetition before the Appellate Authority and failed to pay 15% ofthe tax liability as demanded by the Assessing Officer, the order of the Principal Commissioner cannot be found fault with. 7.It is seen that as against the order of assessment, thepetitioner has filed an appeal before the CIT (A) and the sameis pending. Therefore, it is evident that the order ofassessment has not reached its finality. Needless to say thatthe petitioner is entitled to file stay petition before theAppellate Authority and canvas all the points in support oftheir stay petition. The similar view is expressed by thelearned Judge of this Court in W.P.No.5794 of 2018 dated05.04.2018. However, in this case, they have gone before thePrincipal Commissioner viz., the first respondent herein andsought for stay, who unfortunately rejected the petition by asingle line order, without stating any reason or finding as towhy the application is liable to be rejected. Therefore, I findthat the said order of the first respondent cannot be sustained.However, this Court is not inclined to remit the matter back tothe first respondent for considering the petition once again,since the petitioner is entitled to file such stay petitionbefore the Commissioner of Income Tax (Appeal) himself, wherethe appeal is admittedly pending. 7.Accordingly, this writ petition is allowed and theimpugned order is set aside. Consequently, the petitioner isdirected to file a stay petition before the Commissioner ofIncome Tax (Appeals) in the pending appeal within a period oftwo weeks from the date of receipt of a copy of this order. Ifany such application is filed, the CIT (A) shall take up thesame and dispose at first instance on merits and in accordancewith law within a period of four weeks thereafter. Till suchdecision is taken by the Appellate Authority, no coerciveaction shall be taken against the petitioner. No costs.Consequently, the connected miscellaneous petitions are closed. Sd/- Assistant Registrar //True Copy// Sub Assistant Registrar gsi/vri To 1.The Principal Commissioner of Income Tax-1 121, Mahatma Gandhi Road, Nungambakkam, Chennai – 600 034. 121, Mahatma Gandhi Road, Nungambakkam, Chennai – 600 034. 2.The Deputy Commissioner of Income Tax, Corporate Circle – 1 (1), 121, Mahatma Gandhi Road, Nungambakkam, Chennai – 600 034. Corporate Circle – 1 (1), 121, Mahatma Gandhi Road, Nungambakkam, Chennai – 600 034. 3.The Commissioner of Income Tax (Appeals) -1 121, Mahatma Gandhi Road, Nungambakkam, Chennai – 600 034. 121, Mahatma Gandhi Road, Nungambakkam, Chennai – 600 034. W.P.No.33808 of 2018MR(CO)CSL/23.01.2019