S.arputharaj v. The Deputy Commissioner Of Income Tax, Central Circle-I,Coimbatore

IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 01.11.2017CORAM THE HONOURABLE MR.JUSTICE T.S.SIVAGNANAMWrit Petition No.27898 of 2017andW.M.P. Nos.29922 & 29923 of 2017 S.Arputharaj...PetitionerVs.1. The Deputy Commissioner of Income Tax, Central Circle-I,Coimbatore. 2. Tax Recovery Officer, Central-2, Income Tax Department, Room No.322 3[rd] Floor, New No.46, MG Road, Chennai – 600 034. 3. The Commissioner of Income Tax, Appeals-18, Chennai – 600 034....Respondents Prayer: The writ petition filed under Article 226 of theConstitution of India, to issue a Writ of Certiorari, callingfor the records relating to impugned Demand Notice in TRC.No.80-86/CR-2/2016-17 dated 18.08.2017, issued by the secondrespondent and quash the same and pass orders. For Petitioner : Mr.P.J. Rishikesh for Mr.N.SankarasabariFor Respondent : Mr.A.P.Srinivas Heard Mr.P.J.Rishikesh, learned counsel appearing forMr.N.Sankaransabari, learned counsel on record for thepetitioner and Mr.A.P.Srinivas, learned Standing Counselaccepting notice for the respondents. By consent on either side,the writ petition itself is taken up for final disposal. 2. The petitioner has impugned a communication sent by theTax Recovery Officer, Central Circle No.2, Chennai - the secondrespondent herein intimating the petitioner with regard to therequested for stay of the demand raised in respect of theassessment years 2009-2010 to 2015-16 till the disposal of the https://hcservices.ecourts.gov.in/hcservices/ first appeals before the Commissioner of Income Tax (Appeals)–18. It has been stated that as per partial modification of CBDTinstruction No.1914 dated 21.03.1996, modified on 31.07.2017,providing guidelines for stay of the demand at the firstappellate stage, the petitioner has to pay 20% of the disputeddemand and file stay petition before the Assessing Officer.Therefore, the second respondent informed the petitioner that hecannot consider the petitioner's request for stay. 3. Admittedly, the Tax Recovery Officer cannot grant stay ofthe order of assessment and the remedy lies only before theAssessing Officer or before the First Appellate Authority. Thepetitioner ought to have pursued the matter before the AssessingOfficer or the First Appellate Authority. From the typed set ofpapers, it is seen that the petitioner presented the staypetitions dated 15.3.2017 before the Assessing Officer - thefirst respondent herein on 21.03.2017 and these stay petitionsare still pending. 4. In the meantime, the petitioner parallely moved thesecond respondent - the Tax Recovery Officer seeking for asimilar prayer, which has now been declined by the impugnedproceedings stating that he is not the officer, who can grantsuch a relief. Thus, when the stay petitions are pending beforethe Assessing Officer, the petitioner has to pursue the same byappearing before him and make a request for stay of the demandas assessed by him. 5. The petitioner's case is that four of his properties havebeen attached under section 281B of the Income Tax Act,1961 byorder dated 15.12.2016 and the fifth property has been attachedby order dated 05.10.2017 and these properties would besufficient to safeguard the interests of the Revenue till thedisposal of the appeals before the First Appellate Authority -the third respondent herein. Further, it is contented that themodified instructions of the Central Board of Direct Taxescannot be made applicable to the petitioner, since the staypetitions have been filed much earlier i.e on 21.03.2017. 5. The petitioner's case is that four of his properties havebeen attached under section 281B of the Income Tax Act,1961 byorder dated 15.12.2016 and the fifth property has been attachedby order dated 05.10.2017 and these properties would besufficient to safeguard the interests of the Revenue till thedisposal of the appeals before the First Appellate Authority -the third respondent herein. Further, it is contented that themodified instructions of the Central Board of Direct Taxescannot be made applicable to the petitioner, since the staypetitions have been filed much earlier i.e on 21.03.2017. 6. However, this Court does not propose to render anyfindings on the said contention, since the matter is yet to bedecided by the first respondent. The official memorandum issuedby the Central Board of Direct Taxes dated 29.02.2016 containscertain guidelines to streamline the process of grant of stayand standardize the quantum of lump sum payment required to themade by the assessee as a precondition for stay of demanddisputed before the Commissioner of Income Tax (Appeals). As perthe said guidelines under Clause A, the Assessing Officer shallgrant stay of the demand till the disposal of the first appealon payment of 15%. Clause B of the memorandum deals with twotypes of situations namely where the Assessing Officer is of the view that the lump sum payment amount should be higher than 15%and the other category being where the Assessing Officer is ofthe view that such lump sum payment must be lower than 15%.Therefore, the Assessing Officer has to consider the case onmerits and then take a decision in the matter and notmechanically go by the guidelines issued by the Central Board ofDirect Taxes, as the guidelines themselves provide forcontingencies, which may vary from case to case. 7. The learned counsel for the petitioner would submit thatthe stay petitions dated 15.03.2017 presented before the firstrespondent on 21.03.2017 do not contain full details and seeksleave of this Court to file additional grounds to the staypetitions and pursue the matter before the first respondent. 8. Thus, considering the above factual position, the writpetition is disposed of by directing the petitioner to raiseadditional grounds before the first respondent in support oftheir stay petitions dated 15.03.2017 received on 21.03.2017 inthe office of the Deputy Commissioner of Income Tax, CentralCircle-I, Coimbatore, within a period of one week from the dateof receipt of a copy of this order. On receipt of suchadditional grounds, the first respondent shall afford anopportunity of personal hearing to the authorized representativeof the petitioner and pass orders on merits and in accordancewith law on the stay petitions as expeditiously as possible,preferably within a period of three weeks from the date, onwhich, personal hearing is concluded. Till such time, therespondents shall not initiate any coercive action against thepetitioner. No costs. Consequently, the connected miscellaneouspetitions are closed. Sd/- Assistant Registrar(CS III) //True Copy// Sub Assistant Registrar smn To, 1. The Deputy Commissioner of Income Tax, Central Circle-I,Coimbatore. 2. Tax Recovery Officer, Central-2, Income Tax Department, Room No.322 3[rd] Floor, New No.46, MG Road, Chennai – 600 034. Income Tax Department, Room No.322 3[rd] Floor, New No.46, MG Road, Chennai – 600 034. 3. The Commissioner of Income Tax, Appeals-18, Chennai – 600 034. Appeals-18, Chennai – 600 034. +1 cc to Mr.A.P.Srinivas Advocate sr 78131 +1 cc to Mr.N.Sankara Sabari Advocate sr 77600 Writ Petition No.27898 of 2017andW.M.P. Nos.29922 & 29923 of 2017skv(co)aa22/11/2017