Kunj Bihari Lal Agarwal v. Principal Commissioner Of Income Tax (Central), Jaipur,Central Revenue Building, B.d. Road, Jaipur.central Revenue Building, B.d. Road, Jaipur

HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JODHPUR D.B. Civil Writ Petition No. 3776/2023 Kunj Bihari Lal Agarwal S/o Shri Ram Avtar Agarwal, Aged About43 Years, R/o A-253, Shastri Nagar, Jodhpur (Rajasthan) 342003. ----Petitioner Versus 1. Principal Commissioner Of Income Tax (Central), Jaipur,Central Revenue Building, B.d. Road, Jaipur.Central Revenue Building, B.d. Road, Jaipur. 2. Deputy Commissioner Of Income Tax, Central Circle-2,Jodhpur, Room No. 133 Aayakar Bhawan Paota C Road,Jodhpur.Jodhpur, Room No. 133 Aayakar Bhawan Paota C Road,Jodhpur. 3. Assistant Commissioner Of Income Tax, Central Circle-2,Jodhpur, Aayakar Bhawan Paota C Road, Jodhpur.Jodhpur, Aayakar Bhawan Paota C Road, Jodhpur. ----Respondents For Petitioner(s) : Mr Sharad Kothari For Respondent(s) : Mr K.K.Bissa HON'BLE MR. JUSTICE VIJAY BISHNOI HON'BLE MR. JUSTICE YOGENDRA KUMAR PUROHIT Judgment / Order 01/05/2023 1.This writ petition under Article 226 of the Constitutionof India is filed by the petitioner challenging the order dated03.03.2023 passed by respondent No .1- PCIT, Jaipur, wherebyapplication filed by the petitioner seeking stay of recovery ofdemand pertaining to assessment years 2014-15, 2016-17 and2020-21 has been disposed of in the following manner: “The petition is disposed off subject to following stipulation(s):- 1. The Outstanding aggregate demand of Rs. 25,12,77,982/- to be stayed till disposal of 1st appeal only upon payment of 20% of demand asper above schedule.per above schedule. 2. The applicant is directed to make payment as perthe above schedule.the above schedule. 3. The assessee shall co-operate in early disposal ofthe appeal pending before the Ld. CIT(A).the appeal pending before the Ld. CIT(A). 4. Revenue retains the right to reconsider/review thepayment plans/ stipulations as well as the stayorder anytime in case of any exigency oradministrative requirement or to safeguard theinterests of revenue.payment plans/ stipulations as well as the stayorder anytime in case of any exigency oradministrative requirement or to safeguard theinterests of revenue. 5. This order does not confer any legal right to theassessee. No finding or adjudication on assessee'spending matters can be inferred from this order.The assessee shall not act in any manner that maycause prejudice to interests of revenue. Theassessee's contentions/assertions raised before theundersigned remain unsubstantiated.assessee. No finding or adjudication on assessee'spending matters can be inferred from this order.The assessee shall not act in any manner that maycause prejudice to interests of revenue. Theassessee's contentions/assertions raised before theundersigned remain unsubstantiated. 6. Interest shall be payable by the taxpayer, as per law(irrespective of the stay or instalments granted).(irrespective of the stay or instalments granted). 7. The order is subject to stipulations as laid down inthe CBDT office Memorandum F. No. 404/72/93-ITCC dated 29.02.2016 read with InstructionNo.1914 dated 21.03.1996.the CBDT office Memorandum F. No. 404/72/93-ITCC dated 29.02.2016 read with InstructionNo.1914 dated 21.03.1996. 8. The assessing officer shall ensure/monitor thepayment of tax dues as above. “payment of tax dues as above. “ 2.Brief facts of the case are that a survey under Section133A of the Income Tax Act, 1961 (hereinafter to be referred as‘the I.T. Act’) was carried out at the premises of petitioner on04.03.2020. On the basis of survey report, the assessments forthe years 2014-15 and 2016-17 were reopened by issuing noticeunder Section 148 of the I.T. Act dated 24.03.2021 and26.03.2021 respectively. Assessment for the year 2020-21 wasselected for scrutiny under Section 143(2) of the I.T. Act byissuing notice dated 28.06.2021. The Assessing Authoritythereafter passed the assessment orders dated 07.03.2022 for the 8. The assessing officer shall ensure/monitor thepayment of tax dues as above. “payment of tax dues as above. “ 2.Brief facts of the case are that a survey under Section133A of the Income Tax Act, 1961 (hereinafter to be referred as‘the I.T. Act’) was carried out at the premises of petitioner on04.03.2020. On the basis of survey report, the assessments forthe years 2014-15 and 2016-17 were reopened by issuing noticeunder Section 148 of the I.T. Act dated 24.03.2021 and26.03.2021 respectively. Assessment for the year 2020-21 wasselected for scrutiny under Section 143(2) of the I.T. Act byissuing notice dated 28.06.2021. The Assessing Authoritythereafter passed the assessment orders dated 07.03.2022 for the assessment year 2014-15 and 2016-17 and the order dated21.11.2022 for the assessment year 2020-21. 3.Aggrieved by the aforementioned assessment orders,the petitioner preferred an appeal before the Appellate Authorityand the same is pending consideration. 4.It is to be noticed that against the original return forthe assessment year 2014-15 i.e. Rs.8,04,690/-, the AssessmentOfficer assessed the income of the petitioner as Rs.1,22,93,066/-,whereas against the original return for the assessment year 2016-17 i.e. Rs.10,30,940/-, the Assessment Officer assessed theincome of the petitioner as Rs.1,64,73,499/-. It is also to benoticed that for the assessment year 2020-21 against the originalreturn of Rs.2,19,09,920/-, the Assessment Officer assessed theincome of the petitioner as Rs.24,19,85,720/-. As such a demandof more than Rs.25 crores has been raised against the petitioner. 5.As per the petitioner, the Appellate Authority is not empowered to grant stay on recovery and, therefore, thepetitioner filed an application seeking stay on the said demandbefore the Assessment Officer, however, the Assessment Officerhas not taken any decision on the stay application filed by thepetitioner, then he filed a stay application before the respondentNo.1 in terms of instruction No.1914 issued by the Income TaxDepartment vide order dated 21.03.1996 as modified by officememorandum dated 29.02.2016 and 31.07.2017. 6.It is also claimed by the petitioner that since thedemand raised by the revenue is high-pitch demand, the same is required to be stayed till the disposal of the appeal by theAppellate Authority. 7.It is averred in the petition that the respondent No.1while passing the impugned order has failed to take intoconsideration the prima facie case, balance of convenience andirreparable injury and passed the impugned order in mechanicalmanner without application of mind. 8.It is further contended that the impugned order is notan speaking order and, therefore, the same is violative ofprinciples of natural justice. It is further contended that theimpugned order is contrary to the circulars and officememorandum issued by the revenue department from time totime. 9.Assailing the impugned order, Mr Sharad Kothari-learned counsel for the petitioner has argued that the respondentNo.1 has simply quoted the contents of the stay applications thattoo are reproduced selectively without any application of mind andpassed the impugned order. 10.It is further argued by the learned counsel for thepetitioner that though the circulars and office memorandum issuedby the respondent department from time to time guiding theofficers of the revenue to grant stay on demand subject to thecondition of depositing 20% of the assessed amount but theauthority being quasi-judicial in nature can always order fordepositing of a lesser amount than 20% of the demand. 9.Assailing the impugned order, Mr Sharad Kothari-learned counsel for the petitioner has argued that the respondentNo.1 has simply quoted the contents of the stay applications thattoo are reproduced selectively without any application of mind andpassed the impugned order. 10.It is further argued by the learned counsel for thepetitioner that though the circulars and office memorandum issuedby the respondent department from time to time guiding theofficers of the revenue to grant stay on demand subject to thecondition of depositing 20% of the assessed amount but theauthority being quasi-judicial in nature can always order fordepositing of a lesser amount than 20% of the demand. 11.In support of the above contentions, learned counselfor the petitioner has placed reliance on decision of Hon’bleSupreme Court rendered in Principal Commissioner of IncomeTax and Ors. vs. LG Electronics India (P) Ltd.,MANU/SC0907/2018. He has also placed reliance on decisionsof Delhi High Court rendered in Dr. B.L.Kapur MemorialHospital vs. Commissioner of Income Tax (TDS) Delhi 1 &Ors., W.P. (C) 16287/2022 decided on 25.11.2022;Valvoline Cummins Ltd. vs. Deputy Commissioner ofIncome Tax & Ors., MANU/DE/0801/2008; Soul vs. DeputyCommissioner of Income Tax, MANU/DE/1504/2008;Taneja Developers and Infrastructure Ltd. vs. AssistantCommissionerofIncomeTaxandOrs.,MANU/DE/0352/2009 and Charu Home Products (P.) Ltd.vs. Commissioner of Income Tax-1, MANU/DE/4149/2014.Learned counsel for the petitioner has also placed reliance on adecision of Madras High Court rendered in Geetha Pharma vs.Deputy Commissioner of Income Tax, Circle 1(1) and Ors.,MANU/TN/3269/2020. 12.Learned counsel for the petitioner has, therefore,prayed that the impugned order dated 03.03.2023 may kindly bequashed and set aside and the respondents be directed not toinsist the petitioner to pay 20% of the demand raised till thedisposal of the appeal preferred by the petitioner against theassessment orders dated 07.03.2022 and 21.11.2022 respectively. 13.Reply to the writ petition is filed on behalf of therespondent, whereby the respondent has justified the impugnedorder. It is mentioned in the reply that despite several noticesissued to the petitioner during the assessment process, he failedto furnish satisfactory explanation and taking into considerationoverall facts and circumstances of the case, the AssessmentOfficer passed the assessment orders for the assessment years2014-15, 2016-17, 2020-21. 14.It is also contended that against the demand raised,the petitioner has only deposited an amount of Rs.18,914/- tilldate. It is further mentioned in the reply that the impugned orderpassed by the respondent No.1 is perfectly in consonance with thecirculars and office memorandum issued by the respondent fromtime to time dated 29.02.2016 and the amended instructionsissued on 31.07.2017. 15.Learned counsel Mr K.K.Bissa appearing for therespondents has supported the impugned order and argued that inthe facts and circumstances of the case, no case for interference ismade out. 16.Heard learned counsel for the parties.17.As observed earlier, the income of the petitioner asassessed by the Assessment Officer is more than the returnincome. It is also observed that the difference between theassessed income and the return income is ranging from 11% to15%. As per the circulars and office memorandum issued by therespondent from time to time, particularly Instructions No.1914 dated 21.03.1996, 29.02.2016 and 31.07.2017, the demandraised by the revenue falls within the definition of high-pitchdemand. 15.Learned counsel Mr K.K.Bissa appearing for therespondents has supported the impugned order and argued that inthe facts and circumstances of the case, no case for interference ismade out. 16.Heard learned counsel for the parties.17.As observed earlier, the income of the petitioner asassessed by the Assessment Officer is more than the returnincome. It is also observed that the difference between theassessed income and the return income is ranging from 11% to15%. As per the circulars and office memorandum issued by therespondent from time to time, particularly Instructions No.1914 dated 21.03.1996, 29.02.2016 and 31.07.2017, the demandraised by the revenue falls within the definition of high-pitchdemand. 18.We have gone through the impugned order passed bythe respondent No.1. It is revealed from the impugned order thatthe respondent No.1 quoted certain portions of the stayapplication filed on behalf of the petitioner and also thesubmissions filed on his behalf before it. After quoting certainportions of the stay application and submissions, the respondentNo.1 has passed the impugned order without meeting out thecontentions raised on behalf of the petitioner regarding unduehardships on account of his financial condition and the downfall inthe export industries. 19.From the reply filed on behalf of the revenue, it can begathered that respondent No.1 has completely followed theinstructions provided in the instructions/office memorandum dated29.02.2016 and 31.07.2017. 20.Hon’ble Supreme Court in Principal Commissioner ofIncome Tax and Ors. vs. LG Electronics India (P) Ltd.(supra) has held as under: “2. Having heard Shri Vikramjit Banerjee, learnedASG appearing on behalf of the Appellant, and givingcredence to the fact that he has argued before usthat the administrative Circular will not operate as afetter on the CIT since it is a quasi-judicial authority,we only need to clarify that in all cases like thepresent, it will be open to the authorities, on the factsof individual cases, to grant deposit orders of a lesseramount than 20 per cent, pending appeal.” 21.From the above, it is clear that the Hon’ble SupremeCourt has also ruled that administrative circulars issued by therevenue department from time to time on the subject will notoperate as a fetter and the authority being a quasi-judicialauthority can always grant deposit order of lesser amount than20%. 22.As observed earlier, from the perusal of the impugnedorder, it can be gathered that the respondent No.1 is completelyguided by the administrative circulars issued by the revenuedepartment and has failed to give any finding about the hardshipspointed out by the petitioner and has also not taken intoconsideration the factors such as prima facie case, balance ofconvenience and irreparable loss while passing the impugnedorder. 23.Taking into consideration the above facts andcircumstances of the case, we are of the opinion that theimpugned order is not liable to be sustained as the same is a non-speaking and non-reasoned order. 24.In the result, the writ petition is allowed and theimpugned order is quashed and set aside. The matter is remandedto the respondent No.1 to pass a fresh order keeping in view thefact that being a quasi-judicial authority, it is open to it to grantthe deposit order of a lesser amount than 20% while taking intoconsideration the facts and circumstances of the case particularlythe hardships pointed out by the petitioner in stay application andother submissions. The respondent No.1 shall pass a fresh order after providing opportunity of hearing to the petitionerexpeditiously, preferably within a period of six weeks from thedate of production of certified copy of this order. 25.Stay petition stands disposed of. (YOGENDRA KUMAR PUROHIT),J (VIJAY BISHNOI),J -masif/D.R.