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2020 (9) TMI 201 - HC - Income TaxStay of demand - requiring the petitioner to deposit 20% of the demand while disposing of his application filed under Section 220(6) - HELD THAT - In the present case, upon a perusal of both the orders of demand we find that they are non-speaking - A detailed application was given under section 220(6) of the Act elaborating all the reasons on the basis of which a complete stay order was being sought but the authorities without dealing with any of the grounds has passed a completely non-speaking order in violation of the Instructions and the Guidelines issued by the Department. We allow this petition setting aside both the orders and directing the Assessing Authority (respondent No.1) to pass a fresh order in accordance with law taking into consideration the observations made above and the applicable Guidelines within a period of 15 days from the date of communication of this order.
Issues:
Challenge to order requiring deposit of 20% of demand under Section 220(6) of Income Tax Act, 1961 - Non-speaking orders violating Guidelines for Staying Demand. Analysis: The petitioner sought to quash an order dated 23-1-2020 by the Assessing Authority demanding a 20% deposit while disposing of an application under Section 220(6) of the Income Tax Act, 1961. Additionally, the order dated 18-3-2020 by the Principal Commissioner confirming the Assessing Authority's decision was also challenged. Both orders were found to be non-speaking, contrary to the Guidelines for Staying Demand. The Guidelines, particularly Clause (C)(v), require the Assessing Officer to consider all relevant factors and issue a speaking order when dealing with such applications. The Court noted that despite the petitioner providing a detailed application under Section 220(6) outlining reasons for seeking a complete stay order, the authorities failed to address any of the grounds in their non-speaking orders. This was deemed a violation of the Instructions and Guidelines issued by the Department. Consequently, the Court allowed the petition, setting aside both orders. The Assessing Authority was directed to pass a fresh order within 15 days, taking into account the observations made by the Court and adhering to the applicable Guidelines. The fresh order was to be communicated via email to either party, ensuring compliance with the law and the Guidelines for Staying Demand.
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