The Hon’ble Supreme Court Has Clarified In Principalcommissioner Of Income Tax v. Lg Electronics India Private Limited,(2018) 18 Scc 447. The Relevant Portion From The Said Decision Readsas Under

BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT DATED : 25.02.2022 CORAM THE HONOURABLE MR.JUSTICE C.SARAVANAN W.P(MD).No.3611 of 2022andW.M.P.(MD).No.3146 of 2022 Trichy District Lorry Owners Association,Hindusthan Petroleum Corporation Dealers,No.12/A,East Boulewar Road,Trichy-620 008.Represented by its Secretary,K.Prabakaran ... PetitionerVs. 1.The Commissioner of Income Tax (Appeals) Income Tax Department, National Faceless Appeal Centre, Delhi. 2.The Principal Commissioner of Income Tax Officer of the Principal Commissioner of Income Tax, V.P. Rathinasamy Nadar Road, B.B.Kulam, Madurai. 3.The Income Tax Officer, Ward 1 (1), Office of the Income Tax Officer, Trichy Main Buildings, Williams Road, Cantonment Trichy – 620 015....Respondents Prayer: Writ Petition filed under Article 226 of the Constitutionof India, praying this Court to issue a writ of Mandamus, directingthe Respondents to refund the sum of Rs.74,66,660.44 debited on20.03.2020 for Assessment Year 2017 -18 as due for Income Tax fromour Current Account No. 30550046885 maintained in the State Bank ofIndia, Rock Fort City Branch, Trichirappalli–620 002 to thePetitioner along with applicable interest as per the provisions ofthe Income Tax Act, 1961 on the basis of the Representation of thepetitioner dated 29.09.2021 within a time frame that may bestipulated by this Court. https://hcservices.ecourts.gov.in/hcservices/ Heard the learned counsel for the petitioner and the learnedcounsel for the respondents. 2.The petitioner suffered an assessment order, dated23.11.2019, for the assessment year 2017-2018, the petitioner alsoappears to have filed a statutory appeal on 20.12.2019 under Section246 A of the Income Tax Act, 1961, before CIT (Appeals). Anapplication was also filed to stay the recovery of the amount underSection 220 (6) of the Income Tax Act, 1961. Both these appeal andapplication have not been disposed of by either the AppellateCommissioner, namely, the first respondent herein or by the secondrespondent jurisdictional Assessing Officer. 3. During the interregnum, by a communication dated 02.09.2021,the petitioner was informed that a sum of Rs.74,66,660.44 has beentransferred to the Income Tax Department on specific order from theIncome Tax Department under Section 226 (3) of the Income Tax Act,1961, dated 20.03.2022 vide Demand Draft No.187960. The petitionernow seeks refund of the amount pending appeal. There is no meritsin the present writ petition. Therefore, the present writ petitionis liable to be dismissed. 4. The petitioner is required to deposit a sum of rupeesequivalent to 20% of the amount determined under the AssessmentOrder, pending appeal before the Appellate Commissioner. Thepetitioner is entitled for waiver/stay of the recovery proceedingsin terms of Section 220 (6) of the Income Tax Act, 1961. 5. The Hon’ble Supreme Court has clarified in PrincipalCommissioner of Income Tax Vs LG Electronics India Private Limited,(2018) 18 SCC 447. The relevant portion from the said decision readsas under: “6.The impugned order clearly makes no reference tothe central issue in the pending appeal or the grievanceof the petitioner regarding the order passed by the AO.The impugned order in short is without reasons and istherefore unsustainable in law. 7.For the above reasons, the impugned order is setaside and a direction is issued that the petitioner'sapplication will once again be heard by the Principal CITon merits and without reference to the OM dt. 31st July,2017, which, on the face of it, appears to curtail hisdiscretion. The Principal CIT will dispose of theapplication with a reasoned order not later than two weeksfrom the date of receipt of this order.” https://hcservices.ecourts.gov.in/hcservices/ “6.The impugned order clearly makes no reference tothe central issue in the pending appeal or the grievanceof the petitioner regarding the order passed by the AO.The impugned order in short is without reasons and istherefore unsustainable in law. 7.For the above reasons, the impugned order is setaside and a direction is issued that the petitioner'sapplication will once again be heard by the Principal CITon merits and without reference to the OM dt. 31st July,2017, which, on the face of it, appears to curtail hisdiscretion. The Principal CIT will dispose of theapplication with a reasoned order not later than two weeksfrom the date of receipt of this order.” https://hcservices.ecourts.gov.in/hcservices/ 6. In Kannammal Vs Income Tax Officer, (2019) 413 ITR 390, thisCourt after examining various decisions of the Courts including thatof the Hon’ble Supreme Court has held Trinity Test has to befollowed. This view was also recently followed by this Court byorder dated, 08.04.2021 in Queen Agencies Vs The AssistantCommissioner of Income Tax (Circle-1). 7. since a portion of the tax determined has been recoveredfrom the petitioner, I am inclined to dispose the writ petition withthe observation that the third respondent before whom an applicationwas filed under Section 220 (6) of the Income Tax Act, by thepetitioner on 17.08.2021 shall dispose the same within a periodthirty days from the date of receipt of copy of this order. It isneedless to state that before passing such order, the petitionershall be heard. In case, the petitioner has indeed paid income taxon the demonetised currency received by the petitioner, as it wasallowed to sell petroleum products by receiving the consideration indemonetised currency during the period between 09.11.2016 and30.12.2016 and tax was paid the second respondent may exercise thediscretion in terms of the observation rendered in PrincipalCommissioner of Income Tax Vs LG Electronics India Private Limitedand pass appropriate orders. All further recovery proceedingspending disposal of appeal are subject to order to be passed by thethird respondent on the petition filed by the petitioner on17.08.2021 under Section 220 (6) of the Income Tax Act, 1961. Nocosts. Consequently, the connected Miscellaneous Petition is closed, Note : In view of the present lock down owing to COVID-19 pandemic,a web copy of the order may be utilized for official purposes, but,ensuring that the copy of the order that is presented is the correctcopy, shall be the responsibility of the advocate/litigantconcerned. To 1.The Commissioner of Income Tax (Appeals) Income Tax Department, National Faceless Appeal Centre, Delhi. https://hcservices.ecourts.gov.in/hcservices/ 2.The Principal Commissioner of Income Tax Officer of the Principal Commissioner of Income Tax, V.P. Rathinasamy Nadar Road, B.B.Kulam, Madurai.3.The Income Tax Officer, Ward 1 (1), Office of the Income Tax Officer, Trichy Main Buildings, Williams Road, Cantonment Trichy – 620 015.+1 CC to M/s.R.R.KANNAN, Advocate ( SR-8659[F] dated 25/02/2022 )+1 CC to M/s.N.DILIPKUMAR, Advocate ( SR-9285[F] dated 01/03/2022 ) SNMS/17.03.2022/4P.6C W.P(MD).No.3611 of 202225.02.2022