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TMI Blog1992 (11) TMI 151X X X X Extracts X X X X X X X X Extracts X X X X ..... the appellate order dated 21-9-1992. As on date of the application for stay, it is stated that an amount of Rs. 42,09,337 being the disputed tax, Rs. 18,82,844 being interest under section 234B and interest of Rs. 1,70,489 under section 234C, totalling Rs. 62,62,670 is outstanding. It is also stated that the Income-tax Officer has recovered a sum of Rs. 2,60,369 from the Indian Overseas Bank, two sums of Rs. 1,91,330 and Rs. 43,800 from the Indian Bank by garnishee orders. It is further stated that when the assessee approached the Commissioner of Income-tax for stay of the disputed taxes, a letter dated 9-11-1992 was issued by the Assistant Commissioner (Head Quarters) stating as under :--- " I am desired by the Commissioner of Income-ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the first instance and to entertain stay petitions only in really deserving cases. The present situation is that while the assessee has to pay interest at the rate of 2% for every month (equivalent to 24% per annum) for which the taxes are outstanding, the Revenue pays interest only at 15% per annum. At the same time, due to heavy backlog of cases, the assessees may have to wait for a couple of years or more before the appeals are disposed of. In cases where heavy demands are made which are likely to be reduced on appeal to the Tribunal, it is obvious that the assessees are put in a disadvantageous situation. No doubt, the Revenue has a duty to collect the taxes but then it has always been understood that it need not be a painful exercise. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lect the taxes in a manner prescribed in the Second Schedule. Here again, section 225 provides that it shall be lawful for the Tax Recovery Officer to grant time and stay recovery of such tax. Thus the assessing officer and the Tax Recovery Officer have powers to keep the collection in abeyance while an appeal is pending before the Tribunal. 6. If these officers do not properly respond to the assessee's application, naturally he has to approach the Commissioner of Income-tax who had the power under section 119(3) to guide and instruct them in the exercise of their powers. No doubt, sub-section (3) of section 119 has been deleted by the Taxation Laws (Amendment) Act, 1987 with effect from 1-4-1988. But this was because of the insertion of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lways coupled with a duty to be fair (See de Smith's Judicial Review of Administrative Action - page 283). If however, it is the view of the Revenue that the CIT is not exercising a judicial discretion, then it would mean that he should refrain from interfering with the exercise of the powers of stay by the ITO and the Tax Recovery Officer altogether. We are sure that it is not the policy of the Department to make the office of the Commissioner of Income-tax redundant. Therefore, as long as they exercise superintendence over the ITO and the Tax Recovery Officer, they are expected to exercise their judicial discretion properly. 7. It was next contended that the CIT was not acting as a subordinate to the Tribunal and, therefore, the Tribuna ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... harm and that a prima facie case has been shown. There can be and there are no hard and fast rules. But prudence, discretion and circumspection are called for. There are several other vital considerations apart from the existence of a prima facie case. There is the question of balance of convenience. There is the question of irreparable injury. There is the question of the public interest. There are many such factors worthy of consideration. " We may also recall the observations of the Supreme Court in the case of ITO v. M. K. Mohammed Kunhi [1969] 71 ITR 815 : " It will be only whena strong prima facie case is made out that the Tribunal will consider whether to stay the recovery proceedings and the stay will be granted in most deservi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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