2017 (11) TMI 263 - HC - Income Tax

Seeking of stay of the entire demand - Held that - As the petitioner had agreed to comply with the payment of disputed tax at the rate of ₹ 50 lakhs per month, they are bound to comply with such an undertaking. Now arguing before this Court pleading their financial incapacity or requesting this Court to examine the merits of the assessment is unsustainable, as this Court finds that there is no error in the impugned order.

Summary

Issues:
1. Challenge to order rejecting stay of demand
2. Direction to dispose of pending appeals

Analysis:
1. The petitioner, a private limited company broadcasting Tamil channels, challenged an order rejecting their stay request for the demand as quantified by the Assessing Officer for the years 2011-12 and 2012-13. The first respondent accepted the petitioner's offer to pay ?50 lakhs per month until 15% of the demand is collected or the first appeal is decided. The petitioner sought a direction for the disposal of appeals pending for the years 2011-12 to 2013-14. The petitioner argued that the first respondent failed to consider the principles of prima facie case, balance of convenience, and irreparable hardship while passing the order.

2. The petitioner received a loan from a subsidiary company and trade advances from other companies, claiming that the same amount cannot be taxed twice. They also highlighted a refund due for the assessment year 2008-09 and set aside assessments for 2009-10 and 2010-11. The Revenue's counsel contended that factual issues should be addressed by the Appellate Authority. The petitioner requested the early disposal of appeals, with the third respondent indicating a six-month timeframe for disposal.

3. The Court noted that the petitioner agreed to pay ?50 lakhs monthly based on the first respondent's order, but failed to meet this commitment. Subsequent representations seeking to reduce the monthly payment were rejected. The Court found the petitioner's financial incapacity argument unsustainable, as they were bound by the agreed payment terms. The Court dismissed the writ petition but allowed the petitioner to approach the first respondent with a better offer. The third respondent was directed to expedite the disposal of appeals by a specified date.

4. In conclusion, the Court dismissed the first writ petition and the connected WMP, emphasizing the need for compliance with agreed payment terms. The Court directed the third respondent to expedite the disposal of appeals, setting a deadline for the same. The judgment highlighted the importance of honoring commitments made during legal proceedings and the limited scope for challenging agreed-upon terms at a later stage.