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TMI Blog2014 (6) TMI 115X X X X Extracts X X X X X X X X Extracts X X X X ..... ruary 17, 2014, the very day on which he rejected the stay application filed by the petitioner u/s 220(3) - It is expected of him, having rejected the stay application, to wait for a reasonable period before he takes coercive steps to recover the amounts since the petitioner, faced with an order rejecting the stay application, may need some time to make arrangements to pay the entire tax demand or come up with proposals for paying the same in instalments – the AO is a prospector of the Revenue and he is no doubt expected to protect the interests of the Revenue zealously, but such zeal has to be tempered with the rules of fair play and an anxiety to ensure that an opportunity is not lost to the assessee to make alternative arrangements for clearing the tax dues, once the stay applications filed u/s 220(3) are rejected - The AO had acted in arbitrariness, since the stay applications filed by the petitioners are pending before the Tribunal, the AO is directed to reverse the amount recovered from the bank account in Citi Bank and credit the same in the account of the petitioner – Decided in favour of Assessee. - W.P.(C) 1235/2014, C.M. APPL. 2576/2014, W.P.(C) 1178/2014, C.M. APPL. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... justment but dismissed the other objections. In terms of the directions of the Dispute Resolution Panel, a final assessment order was passed by the first respondent on January 10, 2014, computing the total income of the petitioner at Rs. 113.56 crores and raised a tax demand of Rs. 43,87,90,358. 4. On receipt of the assessment order, an appeal was preferred against it before the Income-tax Appellate Tribunal, Delhi Bench, on February 13, 2014, and the same was registered as I. T. A. No. 836/Del/2014. On February 17, 2014, a stay application was filed before the Tribunal seeking stay of the disputed demand and it is claimed that on the same day it informed the respondents about the filing of the stay application and requested that no coercive action may be taken till the Tribunal disposed of the stay application. In the meantime, on February 14, 2014, an application had been filed before the Assessing Officer under section 220(3) of the Act seeking stay of the recovery of the demand of tax. On this, the Assessing Officer passed an order on February 17, 2014. There, he observed that the demand became payable in the month of February, 2014, but no payment was made by Sony Mobile ag ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er 17, 1994 ; it was a subsidiary of Sony Holding (Asia), B. V., Netherlands and Sony Gulf FZE. It is engaged in the business of importing and disputing a wide range of consumer electronic products in India and providing after-sales support services. In respect of the assessment year 2009-10, it filed a return of income on September 29, 2009, declaring a loss of Rs. 24.72 crores. After issue of a notice under section 143(2) of the Act, the Assessing Officer referred the matter to the Transfer Pricing Officer for determination of the arm's length price of the international transactions. The Transfer Pricing Officer made an adjustment of Rs. 149.35 crores on account of excess AMP expenses and another adjustment of Rs. 5.98 crores on account of additional compensation for software services transactions. The Assessing Officer prepared a draft assessment order on March 26, 2013, on the basis of the recommendations of the Transfer Pricing Officer and after making further disallowances, determined the total income of the petitioner at Rs. 161.56 crores. Objections were filed by Sony India before the Dispute Resolution Panel which gave some minor reliefs but substantially dismissed the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... within his rights in appropriating the amount of Rs. 43.87 crores. He submitted that the assessed tax demand became payable as soon as a period of 30 days from the date on which the notice of demand issued under section 156 of the Act was served on the petitioner expired ; since the demand notice was served on January 17, 2014, the tax became due for payment on the expiry of 30 days thereafter, i.e., February 16, 2014, and since the petitioner did not pay the same until that period, the Assessing Officer rightly resorted to recovery proceedings. He further pointed out that there was no impropriety in the Assessing Officer taking coercive measures to recover the tax, including attachment/garnishee orders under section 226(3) passed on February 17, 2014, since such step was taken after the stay applications filed by the petitioners were rejected ; moreover the petitioner filed stay applications before the Tribunal on February 17, 2014, and February 18, 2014, which fact was not known to the Assessing Officer when he passed the orders under section 226(3). In these circumstances, it was submitted by the learned standing counsel that there was no illegality or impropriety in recovering ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o the Citi Bank. It was on February 17, 2014, that Sony Mobile submitted a stay petition before the Tribunal seeking stay of the disputed tax demand in the appeal filed in I. T. A. No. 836/Del/2014 on February 13, 2014. Sony India Pvt. Ltd. seems to have filed an appeal before the Tribunal on February 13, 2014, in I. T. A. No. 837/Del/2014 but the stay application was filed before the Tribunal on February 18, 2014. At least in the case of Sony India Pvt. Ltd., the respondent could not have known that a stay application would be filed before the Tribunal on the next day. In the case of Sony Mobile, it is a moot question whether the Assessing Officer, at the time of passing the garnishee order and rejecting the stay application on February 17, 2014, was aware of the stay application filed by the petitioner on that day. His letter dated February 17, 2014 in this case states that mere filing of an appeal with the Tribunal is not a good ground for the stay of the recovery proceedings. 16. Having said that this is a case in which technically no fault could be found with the Assessing Officer, we feel that there was an element of impropriety in his action in issuing the garnishee ord ..... 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