2018 (4) TMI 1720 - HC - Income Tax

Stay petition - direction to pay 10% of the demand - contention of the petitioner is that the returns filed by them have been taken for scrutiny maliciously with a view to fasten liability on them for having lodged a complaint against an officer of the department - HELD THAT - It is brought to the notice of this Court in several cases that the files are selected for scrutiny with the aid of computers. Further, in terms of the impugned order, the petitioner is asked to pay a meagre portion of the demand. In the circumstances, no justification to entertain the writ petition challenging Ext.P11 order, in exercise of my discretionary jurisdiction under Article 226 of the Constitution of India. As Senior Counsel prayed for indulgence of this Court to extend the time prescribed for payment of 10% of the demand made in terms of Ext.P11 order. In so far as the petitioner challenged Ext.P11 order in the writ petition and since the writ petition is not being entertained, we deem it appropriate to extend the time granted to the petitioner for payment of 10% of the demand in terms of the impugned order till 12.4.2018. Ordered accordingly.

Summary

Issues:
Assessment revision under Section 143(3) of the Income Tax Act for the year 2014-15 challenged in appeal. Application for stay in the appeal granted with a condition of paying 10% of the demand. Challenge to the condition of payment in the writ petition.

Analysis:
The petitioner, an assessee under the Income Tax Act, had their assessment for the year 2014-15 revised by the assessing officer under Section 143(3) of the Act. The petitioner appealed this assessment through Ext.P4, and also filed an application for stay (Ext.P5) which was granted with a condition to pay 10% of the demand as per Ext.P11 order. The petitioner alleged that the scrutiny of their returns was done maliciously due to a past complaint against a department officer, leading to a revised assessment with a substantial demand.

The petitioner contended that the condition of paying 10% of the demand for availing the stay was unjustified, given the alleged malicious intent behind the scrutiny of their returns. The court noted that the petitioner had been granted interim stay with the payment condition, and found no reason to entertain the challenge to Ext.P11 order under Article 226 of the Constitution of India. The court observed that the petitioner was only asked to pay a small portion of the demand and that the files were selected for scrutiny using computers.

The learned Senior Counsel requested the court to extend the time for payment of the 10% demand as challenged in the writ petition. Since the writ petition challenging Ext.P11 order was not entertained, the court decided to extend the payment deadline until 12.4.2018. Consequently, the writ petition was disposed of accordingly, allowing the extension of time for payment of the demanded amount.