2024 (7) TMI 42 - HC - Income Tax

Notice received u/s 226 (3) - calling upon the petitioner to deposit the tax due as per the assessment order as also a penalty order passed against the petitioner - petitioner sought a stay on the impugned notice demanding 20% of the tax demand - petitioner has also moved an application before the Local Committee constituted for recovery in cases identified as high pitched by the local committee. HELD THAT - Having heard learned counsel for the parties and having perused the record and the relevant orders we find that although the petitioner has filed an appeal challenging the assessment orders before the CIT(A) the petitioner had not moved any stay application before CIT(A). In the present circumstances it is appropriate that the petitioner moves a stay application before the CIT(A) and seek appropriate orders on such application. Insofar as the petitioner s application pending before the Local Committee is concerned as the application is pending for quite sometime in our opinion it would be appropriate that the Local Committee is directed to consider the petitioner s application and take a decision on the same including on any directions to be issued in terms of paragraph E(i)(b) if the petitioner makes out the case to that effect. Let such order be passed by the Local Committee as expeditiously as possible and within a period of 10 days from the date of order of this Court being placed with the office of Local Committee. We keep open all contentions of the petitioner in regard to the proceeding before the CIT(A) as also before the Local Committee.

Summary

Issues:
1. Grievance regarding a notice under Section 226 (3) of the Income Tax Act, 1961.
2. Appeal filed by the petitioner challenging assessment order.
3. Application before the Local Committee for High Pitch Assessment.
4. Lack of stay application before CIT(A).
5. Direction to consider petitioner's application by the Local Committee.

Analysis:
The petitioner's grievance in this Writ Petition pertains to a notice dated 15 May 2024 received from the Assessing Officer under Section 226 (3) of the Income Tax Act, calling for the deposit of tax due as per the assessment order and a penalty order against the petitioner. The petitioner had filed an appeal challenging the assessment order before the CIT(A) dated 17 January 2020, but no stay application had been moved in relation to this appeal. Additionally, an application was made before the Local Committee regarding a High Pitch Assessment, which was still pending. The petitioner sought a stay on the impugned notice demanding 20% of the tax demand. On the other hand, the Respondent supported the department's action, citing the absence of a stay application as justification for the notice.

Upon hearing both parties and reviewing the record and relevant orders, the Court noted the absence of a stay application before the CIT(A) despite the appeal filed by the petitioner. Consequently, the Court directed the petitioner to file a stay application before the CIT(A) and obtain appropriate orders. Regarding the application pending before the Local Committee, the Court directed the Committee to promptly consider the petitioner's application and make a decision, including issuing any necessary directions within 10 days from the Court's order. The Court kept all contentions of the petitioner open for further proceedings before the CIT(A) and the Local Committee.

Ultimately, the petition was disposed of with no costs, and the parties were instructed to act based on an authenticated copy of the Court's order.