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2024 (11) TMI 1215 - HC - Income TaxPendency of the Appeals pending before the CIT(Appeals) - CIT (Appeals) not disposing the pending Appeals on one hand and the recovery Proceedings are initiated by the respondent-Income Tax Department for the outstanding demand - HELD THAT - As respondent Nos.3 to 5 instead of addressing the issue of pendency of the Appeals pending before the CIT(Appeals) has tried to justify the proceedings undertaken by the CIT(Appeals) for the disposal. We are at pain to note that in spite of giving specific directions in paragraph No.9 of the order 2024 (10) TMI 1616 - GUJARAT HIGH COURT the respondent Nos.3 to 5 have ignored the same and repeated what is stated in the earlier affidavit with an addition only reference to annual Central Action Plan 2024-25 and Vivad se Vishwash Scheme, 2024 for issue of pendency of more than 5,80,000 Appeals before the CIT (Appeals). If the respondents are not interested in resolution of the issue of pendency of the Appeals the manner in which it ought to have been resolved by classifying the Appeals as per the issues concerning the recurring issues, covered issues, etc., we are of the opinion that no recovery should be made from the assessees during the pendency of the Appeals. Therefore, in all these petitions, there shall be no recovery of any outstanding dues from the petitioners whose Appeals are pending during pendency of these petitions.
Issues:
1. Delay in disposal of appeals by the Commissioner of Income Tax (Appeals) leading to recovery proceedings by the Income Tax Department. 2. Pendency of a large number of appeals before the appellate authority. 3. Lack of data on average life of pending appeals and allocation of appeals among different Commissioners of Income Tax (Appeals). 4. Insufficient remedial measures to address the backlog of pending appeals. 5. Respondent's failure to address the issue of pendency of appeals as directed by the court. Detailed Analysis: 1. The High Court noted delays in the disposal of appeals by the Commissioner of Income Tax (Appeals), which resulted in the initiation of recovery proceedings by the Income Tax Department. The court expressed concern over the significant backlog of pending appeals and the impact on the system due to the delay in resolving these matters. 2. The court directed the addition of specific respondents, including the Chairman of the Central Board of Direct Tax, to address the issue of pending appeals. The court requested responses on various aspects, such as the pendency of appeals, average life of appeals, allocation of appeals among Commissioners, and remedial measures to reduce delays in disposal. 3. Subsequently, the court received an affidavit-in-reply providing data on the number of pending appeals before the appellate authority. However, there was a lack of specific information on the allocation of appeals among different Commissioners and the average life of pending appeals. The court requested further data on these aspects for a comprehensive understanding of the situation. 4. The court reviewed the remedial measures suggested by the Central Board of Direct Taxes to address the backlog of pending appeals. While some measures were mentioned, such as the e-Dispute Resolution Scheme and the Vivad se Vishwas Scheme, the court found these measures insufficient. The court emphasized the need for a time-bound program for the disposal of the backlog of pending appeals. 5. Despite specific directions from the court to address the issue of pending appeals, the respondent failed to provide adequate responses and instead focused on justifying the proceedings undertaken by the Commissioner of Income Tax (Appeals). The court expressed disappointment in the respondent's lack of cooperation in resolving the issue of pendency of appeals effectively. 6. In light of the respondent's failure to address the pendency of appeals as directed by the court, the High Court ruled that no recovery should be made from the petitioners while their appeals are pending. The court issued a rule to this effect, emphasizing the importance of resolving the backlog of pending appeals efficiently and fairly.
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