Recovery of Tax – Stay of Demand – Subsequent events should be taken into consideration.

The assessment in respect of the assessment years 2010-11 and 2011-12 was reopened by the Income-tax Department by issuing notice u/s. 148. Assessments for these years were carried out afresh by the Assessing Officer imposing an additional tax demand of Rs.64 lakhs. The Petitioner had filed appeals against the said order which were pending before the Commissioner of Income-tax (Appeals). The Petitioner also moved an application for stay of the demand. On this, application, the Commissioner of Income-tax (Appeals) passed orders granting stay of interest and in respect of the tax amount, the petitioner was permitted to deposit the same in 16 installments. However, the Petitioner committed default in making payment of the very first installment because of which the bank account of the Petitioner was attached. The order was challenged by filing a writ petition in the High Court which was dismissed.

Before the Supreme Court it was pointed out that up to now the Petitioner had paid a sum of Rs.27.7 lakh in all. It was also pointed out by the learned counsel for the Petitioner that the main reason for reopening of the assessment for the aforesaid years by issuance of notice u/s. 148 was certain proceedings under the Central Excise Act. A copy of the decision dated September 16, 2015, paused by the Customs, Excise and Service Tax Appellate Tribunal was filed before the Supreme Court by way of additional document, revealing that in appeal against the Order-in- Original of the Excise Department, the CESTAT had set aside the said order and remitted the case back to the adjudicating authority for fresh adjudication.

According to the Supreme Court, in view of the aforesaid subsequent event, it would be appropriate if the petitioner approached the Commissioner of Income-tax (Appeals) once again with an application for stay bringing the aforesaid events to the notice of the Commissioner of Income-tax (Appeals). The Supreme Court was confidant that the Commissioner of Income-tax (Appeals) would consider the application on its own merits and pass orders thereon within a period of four weeks from the date of filing the application. The Supreme Court disposed the special leave petition accordingly.