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TMI Blog2017 (4) TMI 664X X X X Extracts X X X X X X X X Extracts X X X X ..... he Code of Civil Procedure, 1908 relating to attachment before judgment and like circumstances, impel a Court to exercise restraint before passing an attachment order. In the present case no such factor appears on the record. The Revenue seems to have been entirely motivated in ensuring that the refunds due to the petitioner / assessee are somehow not given effect to and that the demand is made so as to ensure that all other periods, available to the petitioner, are shortened. This is a plain case of abuse of power under Section 220(1) which no Court can countenance. - Decided in favour of assessee. - W.P.(C) 2602/2017 - - - Dated:- 21-3-2017 - MR. S. RAVINDRA BHAT MR. NAJMI WAZIRI JJ. Petitioner Through: Mr. M.S. Syali, Sr. Adv. with Mr. Mayank Nagi, Adv. Respondent Through: Mr. Rahul Chaudhary and Ms. Lakshmi Gurung, Advs. S. RAVINDRA BHAT, J (Oral) W.P.(C) 2602/2017 CM No. 11239/2017 1. Issue notice. 2. Mr. Rahul Chaudhary accepts notice for the respondent. With consent, the petition was heard finally. 3. The petitioner is aggrieved by the impugned notice dated 15.03.2017, received by it the next day, purporting to curtail by exercisi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... within thirty days of the service of the notice at the place and to the person mentioned in the notice: Provided that, where the Assessing Officer has any reason to believe that it will be detrimental to revenue if the full period of thirty days aforesaid is allowed, he may, with the previous approval of the Joint Commissioner direct that the sum specified in the notice of demand shall be paid within such period being a period less that the period of thirty days aforesaid, as may be specified by him in the notice of demand... 7. In Sony India Ltd. (supra), the Court apparently recorded as follows: .....12. The proviso has the effect of divesting the assessee of a legitimate right therefore, recourse to such provision has to be for good reasons and with caution. Mere apprehension that dues of the Revenue may not be recoverable without any material or information on the record of the Assessing Officer to support such an apprehension, would in our view be not permissible under the legislative scheme of this provision. We have already noticed that the consequence of default under the provisions of Section 220 are of a severe nature including imposition of interest an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he fact that inbuilt balances and checks have been provided in the Section itself, compliance to basic rule of law would be mandatory to counter-balance the extent of discretion vested in the Assessing Officer. 13.To discuss this aspect in some further elucidation, it may be appropriate to refer to certain illustrations whether mischief would be covered under proviso to Section 220 (1):- (i) If an assessee is intending to leave the territorial jurisdiction with intention to evade payment of demand. (ii) A case where an assessee is liquidating his assets, except in due course of its business; again with the intention of evading to pay tax and defeat the demand raised under Section 156 of the Act, (iii) an assessee is intending to leave the country; (iv) Is doing such act and deeds which would render it impossible for the Revenue to recover its dues on account of arrears or current demand, and (v) Closing of business by the assessee coupled with such other factors as may be deemed relevant by the Assessing Officer to reach to a conclusion that in the interest of the Revenue, period should be curtailed. 14.These are mere illustrations and are not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fficer. From the reading of the order sheet, it is clear that the Assessing Officer did not record his dis-satisfaction in regard to these matters which obviously has a connection to the reasons provided in the above noting leading to passing of the order under Section 220 (1) of the Act. The respondents have not placed on record any material to show that the manufacturing activity was reduced by the company with an intention to evade payment of tax due from the assessee. While one reason is factually incorrect, the other is without any foundation. The Assessing Officer could have easily called upon the assessee to show the proof if the assessee had paid the advance tax on 18th March, 2005 or even 21st March, 2005, when admittedly the representative of the assessee had appeared before the Assessing Officer. In the counter affidavit before us, it is admitted that installments of advance tax were paid by the assessee on 15th March, 2005. This fact, the Assessing Officer could even departmentally verify but no attempt was made by him in this direction. Therefore, this could not be treated as a valid ground for reduction of the period in terms of the proviso to Section 220 (1) of the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... levy of penalty u/s 271(1)(c) of the Act. 3. Therefore, I have reasons to believe that it will be detrimental to revenue if the full period of 30 days is allowed and therefore, if approved, the demand period u/s 156 of the Act may be reduced from 30 days to 7 days. 4. In view of the above facts, it is kindly requested to grant approval for issuing demand notice u/s 156 to the assessee for payment of demand within 7 days of receiving of notice.... 10. It is evident ex-facie from the above that the Revenue was acutely conscious of the fact that for at least three previous assessment years and one subsequent assessment year (2013-14) refunds on account of additions were available to the assessee s account. Apparently for AY 2005-06 penalty was levied on the additions of income derived from sale of securities which was deleted by the CIT(A). The CIT(A), in fact, held as follows: .... The return of income for assessment year involved, was filed on 31.03.2005, while even the order of AO for A.Y. 04-05 in reassessment proceedings is dated 25.01.2007, while in A.Y. 05-06 it is dated 03.12.2007. From a perusal of these facts, it is held that the issue involved, was a que ..... X X X X Extracts X X X X X X X X Extracts X X X X
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