Great Barter Private Limited v. Assistant Commissioner Of Income Tax, Circle-1(1), Kolkata & Ors

Item No.4 & 5. IN THE HIGH COURT OF JUDICATURE AT CALCUTTACIVIL APPELLATE JURISDICTIONAPPELLATE SIDE HEARD ON: 06.12.2022 DELIVERED ON:06.12.2022 CORAM: THE HON’BLE MR. JUSTICE T. S. SIVAGNANAM AND THE HON’BLE MR. JUSTICE HIRANMAY BHATTACHARYYA M.A.T. 244 of 2020 With I.A. No.CAN 1 of 2020 (Old CAN 2510 of 2020) With I.A. No.CAN 2 of 2020 (Old CAN 2511 of 2020) Great Barter Private Limited Vs. Assistant Commissioner of Income Tax, Circle-1(1), Kolkata & Ors. And M.A.T. 245 of 2020WithI.A. No.CAN 1 of 2020 (Old CAN 2504 of 2020) With I.A. No.CAN 2 of 2020 (Old CAN 2506 of 2020) Great Barter Private Limited Vs. Assistant Commissioner of Income Tax, Circle-1(1), Kolkata & Ors. Appearance:- Mrs. Manju Agarwal, Ms. Anju Manot … for the appellant. Mr. Smarjit Roychowdhury …. for the respondents. JUDGMENT (Judgment of the Court was delivered by T.S. SIVAGNANAM, J.) 1.Since the issues involved in these appeals are common andgermane, both the appeals are disposed of by this commonjudgment and order. For the sake of convenience, we take up MAT244 of 2020 for discussion. Re: I.A. No.CAN 1 of 2020 (Old CAN 2510 of 2020) 2.This is an application to condone the delay of 469 days infiling the instant appeal. 3.We have heard Mrs. Manju Agarwal, learned counsel appearingfor the appellant and Mr. Smarajit Roychowdhury, learned counselappearing for the respondents. 4.We are satisfied with the reasons assigned in the affidavitfiled in support of the application. Accordingly, the delay infiling the instant appeal is condoned. 5.The applications for condonation of delay being I.A. No.CAN1 of 2020 (Old CAN 2510 of 2020) and I.A. No.CAN 1 of 2020 (OldCAN 2504 of 2020) are allowed. There shall be no order as tocosts. Re: MAT 244 of 2020 6.This intra Court appeals have been filed both against acommon order dated 26[th] September, 2018 passed in W.P. No.4717(W)of 2018 and W.P. No.4719 of 2018. There was one other writpetition, which was also dismissed in the said order, i.e.W.P.4720 of 2018. 7.The appellant had filed a separate appeal, which appears tohave been dismissed for default and the appellant has filed anapplication for restoration of such appeal. 8.The challenge in the writ petition was to an order passedby the assessing officer, namely, the Assistant Commissioner ofIncome Tax, Central Circle-I(1), Kolkata by which the saidassessing officer disposed of the said petition by directing theappellant to deposit 20% of the tax as determined in the orderof assessment. Various grounds have been urged by the appellantin the said petition filed before the assessing officer as well 8.The challenge in the writ petition was to an order passedby the assessing officer, namely, the Assistant Commissioner ofIncome Tax, Central Circle-I(1), Kolkata by which the saidassessing officer disposed of the said petition by directing theappellant to deposit 20% of the tax as determined in the orderof assessment. Various grounds have been urged by the appellantin the said petition filed before the assessing officer as well as in the writ petition. The grounds, which have been raised bythe appellant, have been noted by the learned Single Bench.However, the learned Single Bench had dismissed the writpetitions on the ground that the appellant had not pleadedhardship in the said application and therefore, no fault can beattributed to the order of the assessing officer, which in theopinion of the appellant, was devoid of reasons. 9.Admittedly, the assessments are high pitched assessmentsand when such high pitched assessments are appealed against andan order of stay is sought for either before the assessingofficer by filing an application under Section 220(6) of theIncome Tax Act, orders are passed by the assessing officereither keeping the notice of recovery in abeyance and nottreating the assessee as an assessee in default till the appealis disposed of. 10.There are yet another set of cases where the assessingofficer for reasons to be recorded imposes certain conditions asa condition for grant of stay. The appellant’s case falls underthe second category where the assessing officer has directed 20%of the demand to be paid by the assessee for being entitled togrant of stay. 11.It is an undisputed fact that as against the impugnedassessment order, appeal has been filed before the Commissionerof Income Tax (Appeals), second respondent on 25[th] January, 2018.It is not clear as to why the appeal is pending before theCommissioner (Appeals) for more than two years. Identicalissues have come up for consideration before various High Courtsand we would refer to two of the decisions of the High Court ofDelhi, namely, Valvoline Cummins Limited – Vs. – DeputyCommissioner of Income Tax, Dfelhi & Ors. reported at 2008 (103)DRJ 567 (DB) and Soul Vs. Deputy Commissioner of Income Taxreported at (2010) 323 ITR 305. 12.In both these cases, the Hon’ble Division Bench of the HighCourt of Delhi has considered high pitched assessments and hasalso taken note of the instruction issued by the CBDT and haveheld that when the assessments are unreasonably high pitched,the notices of recovery should remain stayed till the disposalof the appeal by the first appellate authority. In cases onhand, the return filed by the assessee was a loss return.However, the assessing officer has assessed the income and it isdefinitely a high pitched assessment. That apart, we find thatthe appeal was filed before the Commissioner of Income Tax (Appeals) well within the period of limitation and is pendingsince 25[th] January, 2018.13.That apart, we are informed by the learned Advocateappearing for the appellant that till date the notice of demandhas not been enforced on the assessee. Thus, considering thepeculiar facts and circumstances of the case, we are of the viewthat the appeal itself should be directed to be disposed of bythe Commissioner of Income Tax (Appeals) at an early date anduntil then, recovery proceedings should be kept in abeyance. 14.In the light of the above, the appeals are allowed and theorder passed in the writ petitions is set aside with a directionto keep the recovery notices issued by the assessing officerkept in abeyance and direct the Commissioner of Income Tax(Appeals), the appellate authority, to disposed of the appealson merits and in accordance with law after affording anopportunity of personal hearing to the authorised representativeof the assessee as expeditiously as possible preferably within aperiod of 45 days from the date of receipt of the server copy ofthis judgment and order. 15. We make it clear that we have not gone into the merits ofthe matter and it will be well open to the assessee to canvass all factual and legal issues before the Commissioner of Income Tax (Appeals). 16. There shall be no order as to costs. 17. Urgent photostat certified copy of this order, if applied for, be furnished to the parties expeditiously upon complianceof all legal formalities.of all legal formalities. (T.S. SIVAGNANAM, J) I agree, (HIRANMAY BHATTACHARYYA, J.) NAREN/PALLAB(AR.C)