2022 (6) TMI 1122 - HC - Income Tax

Stay of demand - stay prayer was rejected on the ground that petitioner has not paid 15% of the disputed demand and hence petitioner is not eligible for stay of demand - HELD THAT - We are reluctant to interfere with the order dated 08.12.2021 passed by respondent no.1 rejecting the petition for stay filed by the petitioner. However, we are of the view that since appeal of the petitioner is pending before the respondent no.3, petitioner may file a fresh application for stay before the appellate authority hearing the appeal, and in the event of such an application being filed within a period of fifteen (15) days from to-day, the same shall be considered by respondent no.3 expeditiously within a period of two (02) months from the date of filing of the application and in accordance with law.

Issues:
1. Assessment Order by National e-Assessment Center
2. Appeal before Commissioner of Income Tax (Appeals)
3. Demand Notice issued by respondent no.1
4. Rejection of stay petition under Section 220(6) of the Act
5. Writ Petition challenging rejection of stay petition

Analysis:

1. The petitioner, an assessee under the Income Tax Act, 1961, was assessed by the National e-Assessment Center, Delhi for the Assessment Year 2018-19. The Assessment Order passed on 20.04.2021 made additions to the petitioner's income amounting to Rs.90,75,04,390.

2. Subsequently, the petitioner preferred an appeal before the Commissioner of Income Tax (Appeals), National Faceless Appeal Center on 12.08.2021, which is currently pending.

3. Respondent no.1 issued a Demand Notice on 04.10.2021, requiring the petitioner to pay Rs.35,18,16,080 in accordance with the Assessment Order.

4. The petitioner filed a petition for stay on 02.12.2021 under Section 220(6) of the Act before respondent no.1. However, the stay petition was rejected on 08.12.2021 on the grounds that the petitioner had not paid 15% of the disputed demand, rendering them ineligible for a stay of demand.

5. In response to the rejection of the stay petition, the petitioner filed a Writ Petition challenging the decision. The High Court, after hearing both parties, declined to interfere with the order rejecting the stay petition. The court suggested that the petitioner could file a fresh application for stay before the appellate authority, i.e., respondent no.3, within fifteen days. The appellate authority was directed to consider the application expeditiously within two months from the date of filing and in accordance with the law. The Writ Petition was disposed of without any costs awarded.

6. The court's decision implied that the petitioner's appeal process before the Commissioner of Income Tax (Appeals) should be allowed to proceed, and the petitioner has the opportunity to seek a stay on the demand through the appropriate appellate channels. Any pending miscellaneous applications in the Writ Petition were deemed closed as a result of this judgment.

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