2021 (8) TMI 1031 - HC - Income Tax

Recovery proceedings - contention of petitioner is that, even while the petitioner's appeal, against the assessment order passed by AO under Section 143(3) is pending consideration before CIT(A) a substantial amount has been recovered from the petitioner, which is, an act, contrary to the Office Memorandum issued by the Central Board of Direct Taxes that prescribes payment of 20% of the disputed demand if the demand is contested before CIT(A) - HELD THAT - As pursuant to the assessment order, dated 28.12.2017, which concerns the assessment year (AY) 2015-2016, against the total demand amounting to ₹ 3,37,95,120/-, ₹ 2,92,09,436/- has been recovered till now. Mr. Salil states that the amount recovered, in percentage terms, is 86.43%. Accordingly, issue notice to the respondents. Mr. Sunil Agarwal accepts notice on behalf of the respondents/revenue,he says that he will revert with instructions. In case instructions are received to resist the writ petition, a counter-affidavit will be filed before the next date of hearing.

Summary

Issues:
1. Exemption from filing attested affidavits
2. Recovery of a substantial amount contrary to CBDT Office Memorandum
3. Pending appeal before CIT(A) regarding assessment order

Exemption from filing attested affidavits:
The petitioner sought exemption from filing attested affidavits, which was granted subject to placing duly attested affidavits on record within three days of the Court resuming normal work patterns.

Recovery of a substantial amount contrary to CBDT Office Memorandum:
The petitioner's counsel argued that a significant amount had been recovered from the petitioner despite the appeal against the assessment order pending before the CIT(A). The recovery amounting to 86.43% of the total demand was deemed contrary to the CBDT Office Memorandum, which mandates payment of 20% of the disputed demand if contested before the CIT(A). The Court issued notice to the respondents, and the respondent's counsel accepted the notice, agreeing to revert with instructions. It was decided that status quo would be maintained regarding further recoveries until the next hearing date.

Pending appeal before CIT(A) regarding assessment order:
The petitioner's appeal against the assessment order dated 23.12.2018, passed by the Assessing Officer under Section 143(3) of the Income Tax Act, 1961, was pending before the CIT(A). The petitioner contended that the recovery made was in violation of the CBDT Office Memorandum. The matter was listed for the next hearing on 02.08.2021, and the respondent's counsel agreed to file a counter-affidavit if instructed to resist the writ petition.