GMV Projects and Systems v. Assistant Commissioner of Income-tax Non Corporate Circle 15 (1), Chennai / The Branch Manager, Citi Bank
[Citation -2017-LL-0714-15]

Citation 2017-LL-0714-15
Appellant Name GMV Projects and Systems
Respondent Name Assistant Commissioner of Income-tax Non Corporate Circle 15 (1), Chennai / The Branch Manager, Citi Bank
Court HIGH COURT OF MADRAS
Relevant Act Income-tax
Date of Order 14/07/2017
Assessment Year 2014-15
Judgment View Judgment
Keyword Tags discretionary power • stay petition • time barred
Bot Summary: The Branch Manager, Citi Bank, 2, Club House Road, Chennai... Respondents Prayer: Writ Petition filed under Article 226 of the Constitution of India, praying to issue a Writ of Certiorarified Mandamus to call for the records of the first respondent in his proceedings leading to the issuance of Order under section 226(3) vide PAN:AAGFG1503J dated 28.02.2017, quash the same and direct the Respondent not to take coercive action until the disposal of Appeal. ORDER Heard Mr.S.Sathyanarayanan, learned counsel appearing for the petitioner and Mr.A.P.Srinivas, learned Senior Panel Counsel accepting notice on behalf of the respondents. The petitioner has filed this Writ Petition challenging the order passed by the first respondent dated 28.02.2017 received by the petitioner on 03.03.2017 in a stay application filed by the petitioner praying for stay of collection of demand in respect of the assessment for the year 2014-15. In 4 stated that the notice was sent to a wrong address and the first respondent was constrained to pass the assessment order disallowing the expenses as the assessment was likely to become time barred and no opportunity was given to the petitioner to submit the information called for. With these averments, the petitioner has sought for a complete stay of the demand till the disposal of the appeal and prayed for giving an opportunity of personal hearing before passing an order and also requested to send all notices and communications to the address given in the said stay petition. In 5 an appeal is not a valid ground for stay as per the directives of the CBDT. On perusal of the order of assessment, it is seen that the respondent accepted the fact that the authorised representative of the petitioner appeared before him on various dates and filed the details called for. In the light of the above discussion, the writ petition is allowed, the impugned order is quashed and there will be an order of stay of collection of demand pursuant to the order of assessment dated 20.12.2016 for the assessment year 2014-15 till the disposal of the appeal filed by the petitioner before the Commissioner of Income Tax-Range 15.


IN HIGH COURT OF JUDICATURE AT MADRAS DATED : 14.07.2017 CORAM HONOURABLE Mr. JUSTICE T.S.SIVAGNANAM W.P.No.17886 of 2017 and W.M.P.No.19416 of 2017 M/s.GMV Projects and Systems, 7/C4, Twin Rose Apartmensts, 68, East Coast Road, Thiruvanmiyoor, Chennai 600 041 Represented by its Partner .. Petitioner ..Vs.. 1. Assistant Commissioner of Income Tax Non Corporate Circle 15 (1) Chennai 600 034. 2. Branch Manager, Citi Bank, 2, Club House Road, Chennai. .. Respondents Prayer: Writ Petition filed under Article 226 of Constitution of India, praying to issue Writ of Certiorarified Mandamus to call for records of first respondent in his proceedings leading to issuance of Order under section 226(3) vide PAN:AAGFG1503J dated 28.02.2017, quash same and direct Respondent not to take coercive action until disposal of Appeal. http://www.judis.nic.in 2 For Petitioner : Mr.S.Sathyanarayanan For Respondents : Mr.A.P.Srinivas, Senior Panel Counsel. ORDER Heard Mr.S.Sathyanarayanan, learned counsel appearing for petitioner and Mr.A.P.Srinivas, learned Senior Panel Counsel accepting notice on behalf of respondents. With consent on either side, writ petition itself is taken up for disposal. 2. petitioner has filed this Writ Petition challenging order passed by first respondent dated 28.02.2017 received by petitioner on 03.03.2017 in stay application filed by petitioner praying for stay of collection of demand in respect of assessment for year 2014-15. first respondent has stated that mere pendency of appeal before Commissioner of Income Tax (Appeals) against assessment order is not valid ground for stay of collection demand as per CBDT directives and circular. Further it has been stated that as per recent CBDT circular, petitioner is directed to pay 15% of demand raised in assessment before petitioner wishes to request for stay of demand till disposal of appeal before Commissioner of Income Tax (Appeals). http://www.judis.nic.in 3 3. In my considered view, impugned order is classical case of non-application of mind and abdication of powers of Assessing Officer. Admittedly, petitioner has right to approach Assessing Officer praying for stay of demand pending disposal of appeal by Commissioner of Income Tax (Appeals). Therefore, when Assessing Officer considers Stay Petition, he has to consider whether petitioner/Assessee has made out prima facie case for grant of stay. It may be true that CBDT has issued certain instructions on 02.02.1993 in instruction No.1914 and in office memorandum dated 29.02.2016. In my view these instructions and directives can be guideline for Assessing Officer while considering Stay Petition. instructions cannot take away discretionary power of Assessing Officer and purport of issuing such instruction is to ensure that Assessing Officer adopt uniform approach rather than act in whimsical and arbitrary manner. Thus foremost point that Assessing Officer has to consider is whether assesse has made out prima facie case for grant of interim order. petitioner/assessee filed stay petition dated 20.02.2017 stating that notice dated 05.12.2016 calling for production of vouchers and bills pertaining to business promotion expenses and overseas transport expenses and to appear for personal hearing on 09.12.2016 was received only on 23.12.2016 due to natural calamity, viz., Vardha Cyclone. Further it was http://www.judis.nic.in 4 stated that notice was sent to wrong address and first respondent was constrained to pass assessment order disallowing expenses as assessment was likely to become time barred and no opportunity was given to petitioner to submit information called for. Further it was stated they through their authorised representatives had earlier furnished all ledger accounts and details as required by Assessing Officer from time to time. Further it was stated that aggrieved by assessment order, they have preferred appeal before Commissioner of Income Tax (Appeals)-Range 15 on 18.01.2017. 4. With these averments, petitioner has sought for complete stay of demand till disposal of appeal and prayed for giving opportunity of personal hearing before passing order and also requested to send all notices and communications to address given in said stay petition. Unfortunately, first respondent did not take note of any of submission made by petitioner including request for personal hearing. first respondent has not denied or disputed averments made by petitioner that notice dated 05.12.2016 was received by them only on 23.12.2016 and it was sent to wrong address. If this averment was wrong, then first respondent should have dealt with same and should not have mechanically passed impugned order by observing that mere pendency of http://www.judis.nic.in 5 appeal is not valid ground for stay as per directives of CBDT. On perusal of order of assessment, it is seen that respondent accepted fact that authorised representative of petitioner appeared before him on various dates and filed details called for. However, in assessment order first respondent has not stated as to when notice issued by him dated 05.12.2016 was received by assessee/petitioner. Therefore, assessment order being exparte order, correctness of which will be decided by Commissioner of Income Tax (Appeals). Thus, taking note of all above facts, this is fit case where entire demand should remain stays till appeal is disposed of by Commissioner of Income Tax (Appeals)-Range 15. 5. In light of above discussion, writ petition is allowed, impugned order is quashed and there will be order of stay of collection of demand pursuant to order of assessment dated 20.12.2016 for assessment year 2014-15 till disposal of appeal filed by petitioner before Commissioner of Income Tax (Appeals)-Range 15. No costs. Consequently, connected miscellaneous petition is closed. 14.07.2017 rkp Index:Yes/No http://www.judis.nic.in 6 To 1. Assistant Commissioner of Income Tax Non Corporate Circle 15 (1) Chennai 600 034. 2. Branch Manager, Citi Bank, 2, Club House Road, Chennai. http://www.judis.nic.in 7 T.S.SIVAGNANAM, J. rkp W.P.No.17886 of 2017 and W.M.P.No.19416 of 2017 14.07.2017 http://www.judis.nic.in GMV Projects and Systems v. Assistant Commissioner of Income-tax Non Corporate Circle 15 (1), Chennai / Branch Manager, Citi Bank
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