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TMI Blog2017 (4) TMI 63X X X X Extracts X X X X X X X X Extracts X X X X ..... elief (of adjustment of ₹ 27,93,09,100/- refund) had not been considered in the earlier order. In these circumstances, it is held that the impugned order, to the extent it reviewed the previous order (dated 22nd February, 2017) cannot be sustained. The relief granted (i.e adjustment of refund amount of ₹ 27,93,09,100/-) is, however, upheld. Accordingly, the impugned order, to the extent it reviewed the previous order of 22nd February 2017 and directed payments of ₹ 62,71,95,920/- is set aside. However, to the extent that it granted relief under Para (E) of the instruction (which the AO was within his rights to grant in terms of the remand) is upheld. Therefore, the assessee is directed to deposit the balance amount, i.e. ₹ 34,78,86,820/- (Rs. 62,71,95,920/- minus ₹ 27,93,09,100/-) within two weeks, which would be sufficient compliance of the orders. - W.P.(C) 2539/2017, C.M. APPL.10957-10958/2017 - - - Dated:- 29-3-2017 - MR. S. RAVINDRA BHAT MR. NAJMI WAZIRI JJ. Petitioner Through: Sh. Balbir Singh, Sr. Advocate with Sh. Prakash Kumar, Ms. Rubal Maini and Ms. Rashmi Singh, Advocates. Respondents Through: Sh. Sanjay Jain, ASG with Sh. Ra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... new Spectrum License in terms of the policy. The revenue's treatment of that amount as 'capital' is contested. The petitioner also complained that the AO had not taken into account the refund standing to the credit of the petitioner to the tune of about ₹ 27 crores. 4. After considering the parties submissions, this court had disposed of the petition, in terms of the following operative order: 8. We have considered the submissions of the parties. The impugned order dated 22.02.2017, undoubtedly, has given effect to the OM, relied upon by the petitioner in the sense that the demand has been stayed subject to substantial relief of 85%. However, the circular - as noticed earlier and highlighted by the petitioner also carved out an expenditure in regard to certain covered matters or in regard to other contentious issues, the condition of 15% pre-deposit can be relaxed. The petitioner contentions in this regard are three fold. The impugned order does not disclose whether the AO had an occasion to consider or examine these issues. In these circumstances, the Court is of the opinion that the AO should consider and make an order under Section 220(6) of the Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent to mention section 143(1D) which clearly says that the following:- Notwithstanding anything contained with sub section 1 the processing of a return shall not be necessarily, where a notice has been issued to the assessee under sub section (2) . 4. In light of above discussion the processing of ITR for the A.Y.2015-16 cannot be done as notice u/s 143(2) has already been issued to the assessee. Vide notice dated 22.04.2016. ForA.Y.2016-17 the CPC has not forwarded the necessary ticket for processing of ITR. Hence, the above mentioned refund cannot be taken under consideration for passing order u/s220(6) of the Income Tax Act, 1961. 5. The balance of the addition to the total income returned of the assessee; particularly the addition relating to capital gains is based on assessee own submission that the amount is indeed in nature of capital receipts. There is no contrary decision of the Hon'ble ITAT, Hon'ble High Court or Hon'ble Supreme Court. Neither this issue has been subject matter of considerations of earlier years in assessee own case. In view of the above and for the detailed reason recorded in the assessment order the additions will in all like ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Additional Solicitor General (ASG) urged this court not to interfere with the impugned order, which has examined each of the issues that the petitioner had a grievance with, on account of additions made by the AO, on its merits, to determine the prima facie strength of the case in appeal. The mere fact that the demand was based on a high pitch assessment did not mean that assessees who are to pay the tax due after a valid assessment, are to expect stay automatically, if the demand is high. No doubt the OM allows such discretion, but that has to be used judiciously. Having regard to the overall circumstances of the case, the AO was justified in saying that the important issues which the assessee had complained of in its appeal justified a demand for ₹ 220 crores; after adjusting ₹ 27 crores the assessee had to pay ₹ 203 crores in three easy installments. The ASG cautioned that this court s powers under Article 226 are circumscribed; unless there is illegality or procedural irregularity or unfairness in the order, the discretion used, - at least in the facts of this case, cannot be faulted with, or reviewed on its merits. It was submitted that this court should not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reasons for doing so and that mere filing of an appeal against the assessment order will not be a sufficient reason to stay the recovery of demand. It has been further prescribed that while granting stay, the field officers may require the assessee to offer a suitable security (bank guarantee, etc.) and/ or require the assessee to pay a reasonable amount in lump sum or in instalments. 3. It has been reported that the field authorities often insist on payment of a very high proportion of the disputed demand before granting stay of the balance demand. This often results in hardship for the taxpayers seeking stay of demand. 4. In order to streamline the process of grant of stay and standardize the quantum of lump sum payment required to be made by the assessee as a pre-condition for stay of demand disputed before CIT (A), the following modified guidelines are being issued in partial modification of Instruction No. 1914: A) In a case where the outstanding demand is disputed before CIT (A), the assessing officer shall grant stay of demand till disposal of first appeal on payment of 15% of the disputed demand, unless the case falls in the category discussed in para (B) her ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; (iii) reserve the right to adjust refunds arising, if any, against the demand, to the extent of the amount required for granting stay and subject to the provisions of section 245. 10. No doubt, the AO has a discretion of referring the matter to the CIT if he is of the opinion that the assessee s case in any given matter, deserves consideration for relief beyond the mandated 15% pre-deposit: evident from the phrase the assessing officer is of the view that the nature of addition resulting in the disputed demand is such that payment of a lump sum amount lower than 15% is warranted (e.g. in a case where addition on the same issue has been deleted by appellate authorities in earlier years or the decision of the Supreme Court or jurisdictional High Court is in favour of the assessee, etc.) . In the present case, no doubt the AO did not in the first instance so refer the matter to the higher official; however, this court s order had clearly stated that the issue with respect to such relief should be reconsidered. If the AO felt constrained by the terms of the circular, he could have sought a clarification; at worst, he could have referred the matter to the Commissioner, if ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or. In appeal that decree was confirmed. In second appeal the High Court of Madhya Pradesh agreed with the trial court and the appellate court on the findings given on all issues excepting the issue relating to the effect of abolition of the jagirs on the suit. On that issue, it came to the conclusion that in view of the abolition of jagirs under the Jagir Abolition Act, the plaintiff had lost his title to the suit properties and therefore he could not get a decree for possession of the suit properties. It rejected the contention of the plaintiff that that issue is concluded by the decision of the appellate court made before remand as the same had not been appealed against. It opined that the court had inherent power to consider the correctness of that order. It accordingly allowed the appeal and dismissed the suit. The High Court, in our opinion, erred in holding that the correctness of the remand order was open to review by it. The order in question was made under rule 23, Order 41, Civil Procedure Code. That order was appealable under Order 43 of that Code. As the same was not appealed against, its correctness was no more open to examination in view of s. 105 (2) of the Code whi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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