Dreamz Infrastructure, Rallies Plot, Jaistambh Chowk, Amravati v. Assessing Officer, Assistant/ Deputycommissioner Of Income Tax, New Delhi & Ors

IN THE HIGH COURT OF JUDICATURE AT BOMBAYNAGPUR BENCH, NAGPUR WRIT PETITION NO. 527 OF 2022 (Dreamz Infrastructure, Rallies Plot, Jaistambh Chowk, Amravati Vs. Assessing Officer, Assistant/ DeputyCommissioner of Income Tax, New Delhi & Ors.) Office Notes, Office Memoranda of Coram, appearances, Court's orders of directions Court's or Judge's order and Registrar's orders. Shri Saket Bhattad, Advocate for the petitioner. Shri Anand Parchure with Shri A.J. Bhoot, Advocate for the respondents. CORAM: A. S. CHANDURKAR AND URMILA JOSHI-PHALKE, JJ. D ATE: SEPTEMBER 21, 2022 . Heard. The challenge raised in this Writ Petition is to the order dated 26/4/2021that has been passed by the Assessing Officer under Section 144 read withSection 144B of the Income-tax Act, 1961 (for short “the said Act”). By thatorder, the Assessing Officer has assessed the income tax of the petitioner – Firmwhich according to it is exorbitant and not in consonance with law. Against thatorder, the petitioner has preferred an Appeal before the Commissioner of IncomeTax (Appeals) which is pending. In the meanwhile, the petitioner had soughtstay of the demand in dispute by moving an application on 15/5/2021. TheDeputy Commissioner of Income Tax rejected the stay application on the groundthat the conditions laid down in Clause 4(A) of the Office Memorandum dated29/2/2016 had not been complied with inasmuch as 15% of the disputeddemand had not been deposited. A further application was made before thePrincipal Commissioner of Income Tax reiterating that request. The same hasbeen turned down on 5/10/2021. Consequent thereto, penalty proceedings havebeen initiated under Section 270A of the said Act. In this backdrop, theassessment order dated 26/4/2021 has been sought to be challenged. The learned Counsel for the petitioner submits that though an Appeal hasbeen preferred by challenging the aforesaid order, as a result of rejection of thestay application the bank accounts of the petitioner have been freezed. Invitingattention to Clause 4(B)(b) of the Office Memorandum dated 29/2/2016, it issubmitted that the authorities ought to have considered the request for stay of the demand as made in the light of the power conferred by the said Clause.There has been no consideration of the aforesaid aspect and hence the furthersteps taken consequent to the passing of the assessment order are illegal. Insupport, the learned Counsel seeks to place reliance on the decisions in i)Bhupendra Murji Shah Vs. Deputy Commissioner of Income Tax And Ors. [WPNos. 2157/2018 and 2160/2018 decided on 11/9/2018]; ii) Arcil Retail LoanPortfolio 001-D-Trust And Anr. Vs. Principal Commissioner of Income Tax AndOrs. [WP (L) No. 810/2019 decided on 22/3/2019] with other connectedmatters; and iii) Harsh Dipak Shah Vs. Union Of India [(2022) 113 CCH 0183GujHC]. On the other hand, the learned Counsel for the respondents supported theimpugned order. According to him, since an Appeal has been preferred by thepetitioner, all contentions on merits can be raised before the Appellate Authority.Since the conditions prescribed by Clause 4(A) of the Office Memorandum dated29/2/2016 were not fulfilled, the stay was rightly refused. On the other hand, the learned Counsel for the respondents supported theimpugned order. According to him, since an Appeal has been preferred by thepetitioner, all contentions on merits can be raised before the Appellate Authority.Since the conditions prescribed by Clause 4(A) of the Office Memorandum dated29/2/2016 were not fulfilled, the stay was rightly refused. Having heard the learned Counsel for the parties, it is seen that what isunder challenge in the Writ Petition is the assessment order dated 26/4/2021. Itis not in dispute that this order has been subjected to an Appeal and that Appealis pending. In the interregnum, the petitioner’s request for staying the impugneddemand has been rejected. It is seen that the initial order of rejection is dated6/8/2021 and thereafter on 5/10/2021. It is true that the petitioner seeks to relyupon Clause 4(B)(b) of the Office Memorandum dated 29/2/2016. It howevercannot be lost sight of that consequent to the orders refusing stay, the bankaccounts of the petitioner have been freezed. The orders dated 6/8/2021 and5/10/2021 refusing stay are not under challenge. In the light of the fact that theassessment order is dated 26/4/2021 and there was no interim relief granted inthe present proceedings, the interests of justice would be served by directing theAppellate Authority which is the Commissioner of Income Tax (Appeals) toexpeditiously decide the pending Appeal. All questions on merits can beeffectively raised for consideration before the Appellate Authority. Accordingly, it is directed that the Commissioner of Income Tax (Appeals)shall within a period of eight weeks from today decide the Appeal on its own merits without going into the question of non-compliance of Clause 4(A) of theOffice Memorandum dated 29/2/2016. In the light of the fact that the bankaccounts of the petitioner have already been freezed, no further coercive steps betaken to enforce the demand till the Appeal is decided. It is clarified that thisCourt has not examined the issue on merits and all questions are kept open. The Writ Petition is disposed of with the aforesaid directions. No costs. (URMILA JOSHI-PHALKE, J.) (A. S. CHANDURKAR, J.) SUMIT