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TMI Blog2019 (3) TMI 1478X X X X Extracts X X X X X X X X Extracts X X X X ..... Commissioner of Income Tax-1, the first respondent herein, on 08.03.2019 at 02:30 pm along with a stay petition covering the three (3) aspects as referred to aforesaid. ii) After hearing the petitioner, the Principal Commissioner of Income Tax shall pass a reasoned and speaking order in accordance with law and in accordance with the circulars issued by Central Board of Direct Tax (CBDT) within a period of two (2) weeks from the date of conclusion of the personal hearing i.e. on or before 22.03.2019. - W.P. No.5425 of 2019 And WMP. Nos.6166 & 6168 of 2019 - - - Dated:- 1-3-2019 - Dr. Justice Anita Sumanth For the Petitioner : Mr.R.Sivaraman For the Respondent : Ms.Hema Muralikrishnan, Senior Standing Counsel ORDER This Writ Petition is disposed at the stage of adjourned admission by consent expressed by both learned counsel, Mr.R.Shivaraman, learned counsel appearing for the petitioner and Ms.Hema Mulikrishnan, learned senior standing counsel appearing for the respondents. 2. The Writ Petition challenges an order dated 07.02.2019, passed by the 1st respondent rejecting the application for stay filed by the petitioner. The petitioner had suffered an order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncome-tax Officer, Non-Corporate Ward 2(4), Chennai. Sir, Sub: Stay Petition filed by the assessee M/s.Shriram Finance, Mookambika Complex, 4th floor, 4 Lady Desikachari Road, Mylapore, Chennai 600 004 dated 04.02.2018 PAN AAAFS2596P Reg. Ref : Assessee's petition filed in 04.02.2019. ***** Kindly refer to the above. I am directed to convey the comments of the Pr. Commissioner of Income-Tax-1, Chennai as follows: Petition rejected vide Board's Instruction. AO to collect 20% demand. Yours faithfully, *********** (G.RADHAKRISHNAN) Income-tax Officer (HQ) O/o. Pr.Commissioner of Income-Tax -1 Chennai. Copy to: 1.The JCIT NCR-2, Chennai. 2.The assessee, M/s.Shriram Finance Mookambika Complex, 4th floor, 4 Lady Desikachari Road, Mylapore, Chennai. It is as against the aforesaid order, the petitioner has filed the present writ petition before this Court. 5. This Court had occasion to consider challenge to orders in stay applications that cryptic and non speaking relying wholly on the circular issued by Central Board of Direct Taxes (CBDT). I have, in the aforesaid order, concluded that circulars / in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in order to streamline recovery procedures. This instruction is accordingly being issued in supersession of all earlier instructions on the subject and reiterates the existing Circulars on the subject. 2. The Board is of the view that, as a matter of principle, every demand should be recovered as soon as it becomes due. Demand may be kept in abeyance for valid reasons only in accordance with the guidelines given below : A. Responsibility: i. It shall be the responsibility of the Assessing Officer and the TRO to collect every demand 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 coll ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aking from the assessee that he will co-operate in the early disposal of appeal failing which the stay order will be cancelled. d. reserve the right to review the order passed after expiry of a reasonable period, say up to 6 months, or if the assessee has not co-operated in the early disposal of appeal, or where a subsequent pronouncement by a higher appellate authority or court alters the above situations; e. reserve a right to adjust refunds arising, if any, against the demand. iii. Payment by instalments may be liberally allowed 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 dem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by appellate authorities in earlier years or the decision of the Supreme Court /or jurisdictional High Court is in favour of Revenue or addition is based on credible evidence collected in a search or survey operation, etc.) or, (b) 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.), 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to remit 20% of the disputed demand, granted ample discretion to the authority to either increase or decrease the quantum demanded based on the three vital factors to be taken into consideration. 13. In the present case, the assessing officer has merely rejected the petition by way of a non-speaking order reading as follows: 'Kindly refer to the above. This is to inform you that mere filing of appeal against the said order is not a ground for stay of the demand. Hence your request for stay of demand is rejected and 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, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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