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TMI Blog2009 (5) TMI 867X X X X Extracts X X X X X X X X Extracts X X X X ..... uisite bank guarantee of ₹ 25 lakhs within a period of two months from today and as directed hereinbefore, respondent No. 2 shall hear the revision petition and dispose of the same, in accordance with law, within a period of two months from the date, on which the petitioner complies with the directions - W.P. (C) No. 1907 of 2009 - - - Dated:- 15-5-2009 - ANSARI I.A. , J. JUDGMENT:- I.A. ANSARI J. Heard Dr. A.K. Saraf, learned Senior Counsel, appearing on behalf of the petitioner, and Mr. D. Saikia, learned Standing Counsel, Department of Finance, Government of Assam, appearing on behalf of the respondents. By order, dated February 26, 2008 (annexure A to the writ petition), an assessment of tax, payable by the petitioner, under the Assam Value Added Tax Act, 2003, was made by respondent No. 3, namely, Superintendent of Taxes, Unit B , Guwahati, the assessment being to the tune of Rs. 50 lakhs. Besides direction to make payment of the said assessed amount of tax, the petitioner was, vide letter, dated February 26, 2008, also directed to show cause as to why penalty of an amount of Rs. 1.50 crore should not be imposed on the petitioner. Following the said not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ioner furnished the requisite bank guarantee, an order was passed by the respondent No. 2, on May 8, 2009, dismissing the revision petition. The order, passed by respondent No. 2, reads, inter alia, as under: The petitioner is absent. The petitioner has submitted a petition requesting for two months time to deposit Rs. 21 lakhs and submit bank guarantee for another Rs. 25 lakhs, the petitioner has submitted copies treasury challans for payment of Rs. 4 (four) lakhs. The revision petition was filed on June 21, 2008 and it was dropped on January 1, 2009 because the petitioner did not deposit 25 per cent of disputed amount. On request of the petitioner the petition was revised on April 9, 2009 and petitioner was asked to deposit Rs. 25 lakhs and submit bank guarantee for another Rs. 25 lakhs before the next date fixed, i.e., today. But the petitioner failed to do so. Enough opportunity has been given to the petitioner in this regard. No further opportunity can be given. Hence the petition is not admitted. Inform all concerned. It has, now, been submitted, on behalf of the petitioner, that the respondent No. 2 dealt with the petitioner's prayer for stay of the noti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... accrued thereon, if any. The provisions to section 82(2A), however, lays down that the Commissioner may, if it thinks fit, for reasons to be recorded, in writing, and subject to furnishing all such security as the Commissioner may deem fit, admit an application with part payment or without payment of the disputed amount of tax including penalty, if any, required under this sub-section with a view to mitigate undue hardship which is likely to be caused to the dealer or person if the payment of such disputed amount is insisted on. The power, so conferred on the Commissioner, is momentous power. Greater the power, more careful shall be its exercise. The power, which the Commissioner has been given, under section 82(2A), to suspend the realization of the amount of recovery, is required to be exercised with utmost care and attention. The Commissioner can neither liberally grant stay without securing interest of the State, nor must he insist on deposit of disputed liability, if the dealer or the person, who was directed to make payment of tax or penalty, places sufficient materials to show that he would suffer such hardship, which he should not be made to suffer. The exercise of power, w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... treat the assessee to be not in default. In the case of Aluminium Corporation of India Ltd. v. C. Balakrishnan [1959] 37 ITR 267 (Cal) this interpretation of the law was accepted by Sinha J. There an appeal had been preferred under section 23 of the Wealth Tax Act and thereafter an application had been made to the Wealth Tax Officer for stay under section 31(3) of the Act corresponding to section 45 of the Income-tax Act. An application was made to the Commissioner of Wealth Tax praying for a direction not to treat the assessee to be in default till the disposal of the appeal which was rejected by him. A similar application was then made before the Wealth Tax Officer which was also rejected by him. The petition under article 226 of the Constitution was filed in the High Court against that order which was allowed and the matter was sent back to the Wealth Tax Officer directing him to consider the matter on merits. It was observed by Sinha J. that the matter was no doubt in the discretion of the Wealth Tax Officer, but the discretion had to be exercised judicially and a judicial exercise of the discretion involved a consideration of the facts and circumstances of the case in all i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vocateGeneral that once an assessee has failed to pay up the tax demand, he is a defaulter and the Income-tax Officer is bound to proceed with the realization of the tax, and if he has acted within the ambit of his jurisdiction, this court cannot interfere with the exercise of his discretion and issue a mandamus directing him to stay the realization, can also not be accepted. In the present case, though respondent No. 2 may be correct in insisting on deposit of the tax as well as the penalty, but the manner, in which the matter has been dealt with, is not at all satisfactory. As a matter of fact, the order, directing payment of tax as well as penalty, which was initially passed, did not even indicate that the Commissioner had considered the grounds on which the prayer for suspension or stay as regards the demand notice had made by the petitioner. Be that as it may, it has, now, been submitted, on behalf of the petitioner, that the petitioner agrees to pay the remaining amount of Rs. 19 lakhs within a period of two months from today. The petitioner also agrees to furnish bank guarantee of Rs. 25 lakhs within a period of two months from today. In the facts and circumstances of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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