Sanjay Kumar Kochhar v. Assistant Commissioner of Income-tax, Circle 4(I), Raipur / Commissioner, Income-tax (Appeals), Raipur
[Citation -2017-LL-0713-17]

Citation 2017-LL-0713-17
Appellant Name Sanjay Kumar Kochhar
Respondent Name Assistant Commissioner of Income-tax, Circle 4(I), Raipur / Commissioner, Income-tax (Appeals), Raipur
Court HIGH COURT OF CHHATISGARH
Relevant Act Income-tax
Date of Order 13/07/2017
Judgment View Judgment
Keyword Tags recovery proceeding • demand notice • interim stay • outstanding demand • stay petition • granting of stay
Bot Summary: Challenge in present writ petition is Annexure P/1 which is notice issued by the respondents on 21.03.2017 which was addressed to the Managing Director of Oasis Commercial Pvt. Ltd. intimating that any amount payable to the petitioner by M/s Oasis Commercial Pvt. Ltd. may be deposited with the Income Tax Department. The contention of learned counsel appearing for the petitioner is that the petitioner basically is engaged in trading of food grains and is in the business of import and export of food grains. A notice for assessment was received by the petitioner on 08.09.1994 and the assessment was completed on 30.12.2016 whereby the income tax department assessed the income of the petitioner at Rs.21,62,18,744/-. According to counsel for the petitioner, once when the application under Section 220(6) of the IT Act has been filed and which is still under consideration before the assessing officer, without deciding the said application, the respondents should not have proceeded with the recovery proceeding as the petitioner has been exercising their statutory right which is conferred upon him under the Act. Relying upon the said judgment, counsel for the petitioner has sought for indulgence of the writ court to the extent that interest of the petitioner be protected till the appeal is decided by the Commissioner or at least till the application for grant of stay filed by the petitioner before the assessing officer is pending consideration. Learned counsel for the respondents however opposing the petition submits that this petition is premature. In the event if the application is decided against the interest of the petitioner, it shall be left open for the petitioner to avail the remedy available under the said circular of moving before the Principal Commissioner, Income Tax challenging the order of assessing officer made under Section 220(6) of the IT Act.


NAFR HIGH COURT OF CHHATTISGARH, BILASPUR Writ Petition (T) No.66 of 2017 Sanjay Kumar Kochhar, S/o Shri Kanhaiya Lal Kochar, aged about 44 years, R/o Flat No.304, II Floor, Marudhar Apartment, Budhapara, Raipur, Distt. Raipur (CG). ---- Petitioner Versus 1. Assistant Commissioner of Income Tax, Circle 4(I), Central Revenue Building, Civil Lines, Raipur. 2. Commissioner, Income Tax (Appeals) Central Revenue Building, Civil Lines, Raipur, Distt. Raipur (CG). ---- Respondents For Petitioner : Shri Neelabh Dubey, Advocate. For respondents : Shri Amit Choudhary, Advocate. SB: Hon'ble Shri Justice P. Sam Koshy Order On Board 13/07/2017 1. Challenge in present writ petition is Annexure P/1 which is notice (recovery notice) issued by respondents on 21.03.2017 which was addressed to Managing Director of Oasis Commercial Pvt. Ltd. intimating that any amount payable to petitioner by M/s Oasis Commercial Pvt. Ltd. may be deposited with Income Tax Department. said notice was issued invoking provisions of Section 226(3) of Income Tax Act (for short, IT Act). 2. contention of learned counsel appearing for petitioner is that petitioner basically is engaged in trading of food grains and is in business of import and export of food grains. income declared by petitioner's establishment for assessment year 2 2014-15 was Rs.15,07,690/-. notice for assessment was received by petitioner on 08.09.1994 and assessment was completed on 30.12.2016 whereby income tax department assessed income of petitioner at Rs.21,62,18,744/-. This amount is more than 133 times than declared income which petitioner had made initially of Rs.15,07,690/-. 3. Against this assessment, petitioner had preferred appeal to Commissioner (Appeals) on 18.01.2017 under provisions of Section 246 of IT Act. appeal is pending consideration till date. Meanwhile, demand notice dated 17.02.2017 was issued to petitioner seeking for deposit of amount assessed by assessing officer. Immediately, petitioner moved application on 21.02.2017 seeking for stay of demand notice dated 17.02.2017 under Section 220(6) of IT Act. Pending this application under Section 220(6) of IT Act, assessing officer has issued impugned order (Annexure P/1) to creditors of petitioner namely Oasis Commercial Pvt. Ltd. on 21.03.2017 seeking for deposit of all dues that were payable by said company to petitioner's establishment with income tax department. 4. According to counsel for petitioner, once when application under Section 220(6) of IT Act has been filed and which is still under consideration before assessing officer, without deciding said application, respondents should not have proceeded with recovery proceeding as petitioner has been exercising their statutory right which is conferred upon him under Act. It is further 3 submitted that amount assessed by assessing officer is exorbitantly high and is highpitched assessment and therefore interim stay ought to have been granted by assessing officer without forcing petitioner to deposit 15 percent of amount, otherwise required to be deposited under office memorandum dated 29.02.2016 issued by CBDT. 5. Counsel for petitioner refers to judgment recently passed by Karnataka High Court in similar circumstances i.e. WPS No.1339- 1342/2017 (T-IT) decided on 23.02.2017 (Flipkart India Pvt. Ltd. Vs. Assistant Commissioner of Income Tax & Ors). Relying upon said judgment, counsel for petitioner has sought for indulgence of writ court to extent that interest of petitioner be protected till appeal is decided by Commissioner (Appeals) or at least till application for grant of stay filed by petitioner before assessing officer is pending consideration. 6. Learned counsel for respondents however opposing petition submits that this petition is premature. petitioner's appeal as well as application are still pending consideration. Ex.R/1 is instruction issued by assessing officer to extent of demanding deposit of 15 percent of assessment made which is pre-condition for moving application for grant of stay. He further submits that if at all if said application is decided against interest of petitioner, he still has remedy of moving to Principal Commissioner, Income Tax against rejection of his application under Section 220(6) of IT Act and before availing these two remedies, petitioner has directly 4 rushed for invoking writ jurisdiction of this court and therefore prayed for dismissal of writ petition. 7. Having considered contentions put forth on either side and on perusal of records, if we peruse circular of respondent i.e. instruction No.1914/1993 issued by CBDT, clause 2(B)(iii) of said instruction clearly refers to provision laying down procedure for consideration of application for grant of stay in matters relating to highpitched assessment. For ready reference clause 2(B)(iii) is reproduced herein as under: decision in matter of stay of demand should normally be taken by assessing officer/TRO and his immediate superior. higher superior authority should interfere with decision of AO/TRO only in exceptional circumstances e.g. where assessment order appears to be unreasonably highpitched or where genuine hardship is likely to be caused to assessee....... 8. plain reading of aforesaid instruction makes it very clear that assessing officer or authorities superior to him have been granted ample powers for considering application for stay and condition/grounds on which stay has been sought for. reading of provision shows that ample discretion is left for assessing officer to consider at time of deciding stay application. It would be relevant at this juncture to refer to paragraph 16 of said judgment of Karnataka High Court in case of Flipkart India Pvt .Ltd. (Supra) which reads as under : 16. It is true that Instruction No.4(B)(b) of Circular dated 29.02.2016, gives two instances where less than 15 percent 5 can be asked to be deposited. However, it is equally true that factors, which were directed to be kept in mind both by Assessing Officer, and by higher superior authority, contained in Instruction No.2-B(iii) of Circular No.1914, still continue to exist. For as noted above, said part of Circular No.1914 has been left untouched by Circular dated 29.02.2016. Therefore, while dealing with application filed by assessee, both Assessing Officer, and Prl. CIT, are required to see if assessee's case would fall under Instruction No.2-B(iii) of Circular No.1914, or not? Both Assessing Officer and Prl. CIT, are required to examine whether assessment is unreasonably highpitched , or whether demand amount would lead to genuine hardship being caused to assessee or not ? 9. Taking into consideration view of Karnataka High Court in aforesaid judgment and also considering provisions of Section 2(B)(iii) read with Section 220(6) of IT Act, this court is of opinion that it shall be left for assessing officer at first instance to decide application for grant of stay moved by petitioner and which is pending consideration before him including that of grant of complete stay of execution of recovery notice. 10. In event if application is decided against interest of petitioner, it shall be left open for petitioner to avail remedy available under said circular of moving before Principal Commissioner, Income Tax challenging order of assessing officer made under Section 220(6) of IT Act. 11. Needless to mention that since said clause 2(B)(iii) empowers authorities for grant complete waiver of pre-deposit part, authority concerned, pending consideration stay application, both 6 at stage of assessing officer as well as if it is moved before Principal Commissioner, Income Tax, they shall not take any co- ercive steps for making recovery. 12. Taking into consideration entire factual matrix of case, and with consent of counsel for 60th parties this court is also of view that ends of justice would meet if appeal preferred by petitioner itself is decided by Commissioner (Appeals) at earliest preferably within period of three months. Sd/- (P. Sam Koshy) Judge inder




Sanjay Kumar Kochhar v. Assistant Commissioner of Income-tax, Circle 4(I), Raipur / Commissioner, Income-tax (Appeals), Raipur
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