2021 (10) TMI 1315 - HC - Income Tax

National faceless assessment - Making available the copy of the Video Conferencing which had been recorded on the date on which the hearing had taken place - HELD THAT - Learned Senior Advocate, Mr. Soparkar has additionally, on instructions, submitted that till the further order of the Court, these FDRs shall not be withdrawn. An undertaking to that effect shall be also filed by the petitioner on or before 21.10.2021. For now, the matter is being posted on 25.10.2021, accepting the version of learned Senior Advocate with a direction to the concerned bank to be sent through the registry the undertaking given by the petitioner through the learned Senior Advocate for it not to permit the release of FDRs till further order of the Court. There shall be stay of demand of addition made in the assessment order impugned and the demand of penalty till the next adjourned date. Other and further order with regard to the additional security for protecting the interest of the Revenue shall be passed on 25.10.2021 after hearing both the sides.

Summary

Issues: Stay of demand for payment under Section 274 and 278(A) - Security for demand - Availability of Video Conference recording

In this case, the primary issue before the court was the request for a stay on the demand for payment under Section 274 and 278(A) due to the impending deadline. The petitioner sought to avoid serious consequences by requesting the operation of the demand to be stayed. The court considered the substantial amount involved and the penalty under consideration, emphasizing the need for a balance in deciding on the stay. The petitioner proposed offering a specified portion of their property as security to ensure eventual recovery by the Revenue.

Another issue arose regarding the security for the demand raised. The court was presented with details of three fixed deposits with a bank, each amounting to a significant sum, to be furnished as security. The petitioner undertook not to withdraw these fixed deposits until further court orders, providing assurance to the court regarding the security offered.

Furthermore, the issue of the availability of the Video Conference recording was raised during the proceedings. The court allowed time for the petitioner to receive the necessary instructions related to the recording and scheduled the matter for further consideration on a later date.

The court, after hearing both sides, granted a stay on the demand for payment under Section 274 and 278(A) until the next adjourned date. It directed the concerned bank not to permit the release of the fixed deposits as part of the security arrangement. The court indicated that additional orders concerning the security for protecting the Revenue's interest would be addressed in the next hearing. The case was adjourned to 25.10.2021 for the parties to provide further submissions and for the court to make a final decision based on the information presented.