2017 (3) TMI 1530 - SC - Income Tax

Stay applications rejected - directed the appellant to deposit 15 per cent of the total tax demand - Held that - Without going into the merits of the matter, as the same is pending before the Commissioner of Income Tax (Appeals) in appeal filed by the appellant, we consider it proper and in the interest of justice to dispose of these appeals with the following directions (1) The CIT (Appeals) is directed to decide the pending appeals filed by the appellant herein within one month from the date of production of the copy of this order, in accordance with law, without granting unnecessary adjournments; (2) The Income Tax Department (respondent herein) is directed to withdraw the amount of ₹ 400/crores approximately already attached by the respondent; (3) The term deposit of ₹ 1000 crores approximately which has been invested by the appellant shall be kept by the appellant in the form of security in favour of the respondents in relation to the disputed amount in question till the disposal of the appeal by the CIT (Appeals); (4) The respondent (Income Tax Department) shall not attach any other accounts of the appellant or take coercive steps during the pendency of the appeal before the CIT (Appeals).

Summary

Issues Involved:
Challenge to High Court order dismissing writ petitions, rejection of stay applications by Commissioner of Income Tax (Appeals), attachment of appellant's bank accounts, direction to deposit 15% of total tax demand, appeal pending before CIT (Appeals), withdrawal of attached amount, security of term deposit, prohibition on further attachment or coercive steps.

Analysis:
The Supreme Court granted leave in the case where the Writ Petitioner (Assessee) challenged the High Court's order dismissing their petition. The Commissioner of Income Tax (Appeals) had rejected stay applications and directed the appellant to deposit 15% of the total tax demand for multiple assessment years. The appellant filed writ petitions before the Bombay High Court, which were also dismissed. The Attorney General highlighted that the appellant, a statutory corporation, had significant fixed term deposits in banks. The appellant's counsel mentioned that certain bank accounts were attached, while the fixed deposit amount belonged to the State Government.

The Supreme Court, without delving into the merits pending before the Commissioner of Income Tax (Appeals), issued specific directions. Firstly, the CIT (Appeals) was directed to decide the pending appeals within one month without unnecessary adjournments. Secondly, the Income Tax Department was instructed to withdraw the approximately ?400 crores already attached. Thirdly, the appellant was directed to keep the term deposit of approximately ?1000 crores as security until the appeal's disposal. Lastly, the Income Tax Department was prohibited from attaching any other accounts or taking coercive steps during the appeal's pendency.

In conclusion, the Civil Appeals were disposed of with the aforementioned directions, ensuring a fair and just resolution while safeguarding the appellant's interests during the ongoing appeal process before the CIT (Appeals).