1990 (3) TMI 64 - HC - Income Tax

Summary

Issues:
1. Challenge to impugned orders under section 220(6) of the Income-tax Act regarding stay of tax payment.
2. Allegation of improper exercise of discretion by respondent No. 1.
3. Interpretation of guidelines and instructions under section 119 of the Income-tax Act.
4. Dispute over the validity of subsequent instructions superseding previous guidelines.
5. Petitioner's plea for interim orders and opposition by respondents.
6. Examination of impugned orders and discretion exercised by respondent No. 1.
7. Application of relevant legal principles and precedents in the decision-making process.

Detailed Analysis:
1. The writ petition filed by the petitioner challenged three impugned orders under section 220(6) of the Income-tax Act, which grant discretionary power to extend tax payment time or grant stay of demand till appeal disposal. The petitioner alleged that respondent No. 1 did not consider all relevant factors, rendering the orders illegal and invalid.

2. The petitioner argued that respondent No. 1 failed to exercise discretion judicially, citing guidelines from a 1969 meeting as a basis for proper exercise of jurisdiction in staying demand till appeal disposal. The petitioner contended that the impugned orders were inherently defective and should not penalize the petitioner for challenging the vires of a tax provision.

3. The interpretation of guidelines and instructions under section 119 of the Income-tax Act was a key issue. The petitioner's counsel argued that the instructions had the force of law and should guide respondent No. 1 in exercising discretion under section 220(6) to protect the assessee's interest.

4. A dispute arose over the validity of subsequent instructions superseding previous guidelines. The petitioner contended that the guideline from 1969 meeting should be followed, while the respondents relied on the latest instruction clarifying the exercise of discretion under section 220(6) as the valid and current directive.

5. The petitioner sought interim orders, which were opposed by the respondents. The court was presented with arguments regarding the applicability and relevance of the latest instruction to the case, highlighting the petitioner's plea and the respondents' stance on the matter.

6. The court extensively examined the impugned orders and the discretion exercised by respondent No. 1. It found that the officer had considered relevant factors and imposed conditions while disposing of the applications for stay, concluding that the orders were not arbitrary or capricious.

7. In the decision-making process, the court applied relevant legal principles and cited precedents to emphasize that the High Court should not interfere in the statutory authority's decisions unless they are mala fide, capricious, or arbitrary. The court upheld the orders, emphasizing the importance of the officer's discretion and the consideration of various factors in such cases.