2022 (1) TMI 430 - HC - Income Tax

Stay of demand - amounts to be pre-deposited - HELD THAT - We are inclined to dispose this writ petition by directing the petitioner to pay a sum of ₹ 30,00,000/- per month till the amount is paid. The amounts shall be paid by the petitioner by 5th of every month. In case there is failure to pay the amounts by the due date, the protection under this order shall come to an end sine die and the respondent will be at liberty to attach the bank accounts of the petitioner. In other words, the impugned Assessment Order shall stand revived without any reference. Appeal of the petitioner which is pending before the Commissioner of Income Tax (Appeals) shall be taken up for a final hearing only after the petitioner pays the entire amount of ₹ 2,98,81,885/- in terms of this order.

Summary

Issues:
1. Stay of recovery proceedings pending appeal.
2. Amount to be deposited for appeal to be heard.
3. Attachment of bank accounts due to non-payment.
4. Payment schedule directed by the court.
5. Impact on appeal proceedings.

Analysis:
1. The petitioner filed a Writ Petition seeking a stay on the recovery proceedings after receiving the Assessment Order for the Assessment Year 2018-2019. The petitioner also appealed to the Commissioner of Income Tax (Appeals) and filed an application under Section 220(6) of the Income Tax Act, 1961 to stay the recovery proceedings.

2. The respondent, referring to circulars issued by the Central Board of Direct Taxes, ordered the petitioner to deposit 20% of the tax due for the appeal to be heard, with the condition that stay would be granted pending the appeal's disposal. The petitioner requested to deposit the amount in monthly installments, but as the full amount was not paid, the respondent attached the petitioner's bank accounts.

3. The court directed the petitioner to pay a monthly sum of &8377; 30,00,000 until the total amount of &8377; 2,98,81,885 is paid. Failure to make payments by the specified date would result in the protection under the order being revoked, allowing the respondent to attach the bank accounts. The Assessment Order would then stand revived without any reference.

4. The court specified that the appeal before the Commissioner of Income Tax (Appeals) would only be heard after the petitioner pays the entire amount as directed. The payment schedule was set with the first installment due by a specific date.

5. The court emphasized that the payments required from the petitioner were without prejudice to their rights in the appeal pending before the Commissioner of Income Tax (Appeals). The Writ Petition was disposed of with these directions, and no costs were awarded. Connected Writ Miscellaneous Petitions were also closed as a consequence of this judgment.