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TMI Blog2019 (3) TMI 77X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the assessee, which simply relies upon the circulars issued without reference to the existence of a prima facie case, financial stringency and balance of convenience. - W.P.Nos.30094, 30098, 30104 & 30110 of 2018 And WMP.Nos. 35104, 35110, 35114, 35120, 35121, 35126 and 35128 of 2018 - - - Dated:- 21-2-2019 - Dr. Justice Anita Sumanth For the Petitioner : Mr. Y. Prakash For the Respondents : Ms. Hema Muralikrishnan, Senior Standing counsel COMMON ORDER The petitioner in these Writ Petitions an assessee, on the file of the Income Tax Officer, Non Corporate Ward I(2), Chennai, has preferred appeals challenging orders of assessment dated 29.12.2017 in respect of assessment years 2010-11, 2011-12, 2012-13 and 2013-14 before the Commissioner of Income Tax (Appeals) (in short 'CIT(A)') on 30.01.2018. 2. Mr.Y.Prakash, learned counsel appearing for the petitioner states that the appeals have been heard in part and are pending disposal. The petitioner is stated to be appearing before the Authority and co-operating in the disposal of the appeals. 3. It appears that petitions for stay of recovery of the disputed demands in respect of the four (4) asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lea before the Assessing Officer that all records to substantiate the bank deposits has been washed away in the floods that hit the city of Chennai in 2015. 10. She points out the contradiction in the submission made by the petitioner now before this Court to the effect that all supporting evidences have been provided before the CIT(A) now to prove the cash deposits. 11. Heard learned counsel on both sides. The circulars issued by the CBDT only set out a series of guidelines to the Assessing Officers in the matter of grant of stay. I have had occasion to consider the impact of the Circulars on the powers of the Assessing Officer/Authorities under the Act to grant a stay, in the case of Mrs.Kannammal V. Income Tax Officer (W.P.No.3849 of 2019 dated 13.02.2019) and have held as follows: '7. The parameters to be taken into account in considering the grant of stay of disputed demand are well settled the existence of a prima facie case, financial stringency and the balance of convenience. Financial stringency would include within its ambit the question of 'irreparable in jury' and undue hardship as well. It is only upon an application of the three factors ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd that has been raised, except the following: (a) Demand which has not fallen due;(b) Demand which has been stayed by a Court or ITAT or Settlement Commission;(c) Demand for which a proper proposal for write-off has been submitted;(d) Demand stayed in accordance with paras B C below. ii. Where demand in respect of which a recovery certificate has been issued or a statement has been drawn, the primary responsibility for the collection of tax shall rest with the TRO. iii. It would be the responsibility of the supervisory authorities to ensure that the Assessing Officers and the TROs take all such measures as are necessary to collect the demand. It must be understood that mere issue of a show cause notice with no followup is not to be regarded as adequate effort to recover taxes. B. Stay Petitions: i. Stay petitions filed with the Assessing Officers must be disposed of within two weeks of the filing of petition by the tax- payer. The assessee must be intimated of the decision without delay. ii. Where stay petitions are made to the authorities higher than the Assessing Officer (DC/CIT/CC), it is the responsibility of the higher authorities to dispose of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wed so as to collect the entire demand within a reasonable period not exceeding 18 months. iv. Since the phrase stay of demand does not occur in section 220(6) of the Income-tax Act, the Assessing Officer should always use in any order passed under section 220(6) [or under section 220(3) or section 220(7)], the expression that occurs in the section viz., that he agrees to treat the assessee as not being default in respect of the amount specified, subject to such conditions as he deems fit to impose. v. While considering an application under section 220(6), the Assessing Officer should consider all relevant factors having a bearing on the demand raised and communicate his decision in the form of a speaking order. D. Miscellaneous: i. Even where recovery of demand has been stayed, the Assessing Officer will continue to review the situation to ensure that the conditions imposed are fulfilled by the assessee failing which the stay order would need to be withdrawn. ii. Where the assessee seeks stay of demand from the Tribunal, it should be strongly opposed. If the assessee presses his application, the CIT should direct the departmental representative to requ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Supreme Court or jurisdictional High Court is in favour of the assessee, etc.), the assessing officer shall refer the matter to the administrative Pr. CIT/ CIT, who after considering all relevant facts shall decide the quantum/ proportion of demand to be paid by the assessee as lump sum payment for granting a stay of the balance demand.' 11. Instruction 1914 was further modified by Office Memorandum bearing number F.No.404/72/93 ITCC dated 31.07 2017 as follows: 'OFFICE MEMORANDUM F. No. 404/72/93-ITCC dated 31.07.2017 Subject: Partial modification of Instruction No. 1914 dated 21.3.1996 to provide for guidelines for stay of demand at the first appeal stage. Reference: Board s O.M. of even number dated 29.2.2016 Instruction No. 1914 dated 21.3.1996 contains guidelines issued by the Board regarding procedure to be followed for recovery of outstanding demand, including procedure for grant of stay of demand. Vide O.M. N0.404/72/93-ITCC dated 29.2.2016 revised guidelines were issued in partial modification of instruction No 1914, wherein, inter alia, vide para 4(A) it had been laid down that in a case where the outstanding demand is disputed before ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd you are requested to pay the demand immediately. Notice u/s.221(1) of the Income Tax Act, 1961 is enclosed herewith.' 14. The disposal of the request for stay by the petitioner leaves much to be desired. I am of the categoric view that the Assessing Officer ought to have taken note of the conditions precedent for the grant of stay as well as the Circulars issued by the CBDT and passed a speaking order. Of course the petition seeking stay filed by the petitioner is itself cryptic. However, as noted by the Supreme Court in the case of Commissioner of Income tax vs Mahindra Mills, ((2008) 296 ITR 85 (Mad)) in the context of grant of depreciation, the Circular of the Central Board of Revenue (No. 14 (SL- 35) of 1955 dated April 11, 1955) requires the officers of the department to assist a taxpayer in every reasonable way, particularly in the matter of claiming and securing reliefs. .... Although, therefore, the responsibility for claiming refunds and reliefs rests with the assessees on whom it is imposed by law, officers should draw their attention to any refunds or reliefs to which they appear to be clearly entitled but which they have omitted to claim for some reaso ..... 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