WP228_20.doc IN HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION WRIT PETITION NO.228 OF 2020 Teleperformance BPO Holdings Pvt. Ltd. Petitioner Vs. Assistant Commissioner of Income Tax, Central Circle 12(2)(2) and others Respondents Mr. J. D. Mistry, Senior Advocate i/b. Mr. Madhur Agarwal and Mr. A. K. Jasani for Petitioner. Mr. Sham Walve a/w. Mr. Pritesh Chatterjee for Respondent Nos.1 to 3. CORAM : UJJAL BHUYAN & MILIND N. JADHAV, JJ. DATE : JANUARY 24, 2020 P.C. : Heard Mr. Mistry, learned senior counsel assisted by Mr. Agarwal, learned counsel for petitioner and Mr. Walve, learned standing counsel Revenue for respondent Nos.1 to 3. 2. By filing this Petition under Article 226 of Constitution of India, petitioner seeks quashing of notice of demand under Section 156 of Income Tax Act, 1961 (briefly "the Act" hereinafter) issued by Assistant Commissioner of Income Tax, Circle 12(2)(2), Mumbai dated 27.12.2018 as well as consequential garnishee notices and individual recovery notices issued to directors of petitioner under Section 179 of Act. 3. For purpose of adjudication of instant writ petition, it may not be necessary to delve into factual controversy in detail. Suffice it say that in assessment proceeding for assessment year 2016-17, assessee had added back to its total income its investment in Intelenet Global Services Pvt. Ltd. as non-deductible expenditure. However, Assessing Officer invoked Sections 60 and 63 of Act 1/4 ::: Uploaded on - 27/01/2020 ::: Downloaded on - 01/02/2020 10:51:07 ::: WP228_20.doc and worked out figure of Rs.496,25,40,000.00 as fair market value of shares, taxable as income of assessee under head of "income from other resources". Thus, vide assessment order dated 27.12.2018, amount of Rs.496,25,40,000.00 was rounded off as taxable income of petitioner. 4. This was followed by notice of demand under Section 156 of Act dated 27.12.2018 whereby petitioner was informed that sum of Rs.2,28,44,52,663.00 is payable as income tax. 5. It is stated that against aforesaid assessment order dated 27.12.2018, petitioner has preferred appeal under Section 246-A of Act before Commissioner of Income Tax (Appeals) - 20, Mumbai on 23.01.2019. 6. Mr. Mistry has submitted that in appeal proceeding, petitioner has submitted written arguments. 7. Parallely petitioner approached administrative Commissioner i.e. Principal Commissioner of Income Tax-12, Mumbai for stay of demand. 8. Mr. Mistry has also submitted that petitioner has made payment of Rs.25 crore as part of demand. However, on query by Court, he submits that such payment is under protest. Petitioner has made detailed written submissions for stay of demand. It is stated that notice dated 08.11.2019 was issued by office of Principal Commissioner to petitioner for hearing on 14.11.2019 but said notice was received by petitioner only on 23.11.2019. Therefore, authorized representative of petitioner could not appear for hearing on 14.11.2019 but subsequently appeared on 26.11.2019 and made oral submissions. However, no order has been passed on stay prayer. While stay application was pending, notices dated 03.01.2020 under Section 226(3) of Act were issued to Kotak Mahindra Mutual Fund 2/4 ::: Uploaded on - 27/01/2020 ::: Downloaded on - 01/02/2020 10:51:07 ::: WP228_20.doc and to debtors of petitioner. In addition, notices under Section 179 of Act dated 01.01.2020 were issued to individual directors of petitioner for recovery of amount covered by notice of demand. It is at this stage that present writ petition has been filed. 9. Mr. Mistry submits that demand itself is untenable in law. Petitioner has good prima facie case and has also demonstrated its financial hardship because of which it is not possible on part of petitioner to satisfy demand. But basic crux of argument of Mr. Mistry is that when stay application is pending and without taking any decision on stay application, it was not justified on part of revenue authorities in issuing impugned notices. He has also placed reliance on decision of this Court in UTI Mutual Fund Vs. Income Tax Officer, (2012) 345 ITR 71 to contend that revenue authority dealing with prayer for stay is required to exercise its jurisdiction having regard to parameters laid down in said judgment. 10. On other hand, Mr. Walve submits that speaking order has been passed by Assessing Officer on 20.09.2019 rejecting prayer for stay of demand. It was thereafter that impugned notices have been issued. 11. In reply Mr. Mistry submits that rejection of stay prayer by Assessing Officer when same is pending before higher authority is neither here nor there; it makes no material difference at all to situation. 12. Submissions made by learned counsel for parties have been considered. Also perused materials on record. 13. After hearing learned counsel for parties and on due consideration, Court is of view that when petitioner has filed 3/4 ::: Uploaded on - 27/01/2020 ::: Downloaded on - 01/02/2020 10:51:07 ::: WP228_20.doc statutory appeal against order of assessment and has also parallely filed application for stay before administrative Commissioner; without taking decision either on appeal or on prayer for stay, it was not justified on part of revenue authority in issuing impugned notices. In circumstances, rejection of prayer for stay by Assessing Officer when appeal is pending before first appellate authority and stay prayer is pending before administrative Commissioner, in our view, would not be of much consequence. Therefore, taking overall view of matter, we feel that appeal filed by petitioner under Section 246-A of Act, which has been registered as CIT (A)-20.Mumbai/10324/2018-19 should be heard and decided by first appellate authority in accordance with law within period of four weeks from date of receipt of authenticated copy of this order. Ordered accordingly. During this period of four weeks, impugned notices under Section 179 as well as under Section 226(3) of Act shall remain in abeyance. Petitioner shall fully co-operate with appellate authority while hearing appeal. 14. Needless to say we have not expressed any opinion on merit and all contentions are kept open. 15. It is also made clear that if appeal order goes against petitioner, same shall be kept in abeyance for further period of two weeks from date of receipt of order to enable petitioner to avail statutory remedy as provided under Act. 16. Writ Petition is disposed of. (MILIND N. JADHAV, J.) (UJJAL BHUYAN, J.) Minal Parab 4/4 ::: Uploaded on - 27/01/2020 ::: Downloaded on - 01/02/2020 10:51:07 ::: Teleperformance BPO Holdings Pvt. Ltd. v. Assistant Commissioner of Income-tax, Central Circle 12(2)(2) and other