Supreme Court Orders Petitioner to Seek Stay of Demand with Income Tax Commissioner

The Supreme Court directed the petitioner to approach the Commissioner of Income Tax (Appeals) for a stay of demand after a subsequent event affected the assessment. The Court expressed confidence in the CIT (Appeals) to review promptly, considering new developments, and make a decision within four weeks of filing. Special leave petitions were disposed of accordingly.

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Issues: Reopening of assessment under Income Tax Act, default in payment leading to attachment of bank account, challenge of order in High Court, subsequent event affecting assessment, direction to approach CIT (Appeals) for stay.

In this judgment, the Supreme Court dealt with a case where the Income Tax Department reopened assessments for the years 2010-2011 and 2011-2012, resulting in a demand of Rs. 64 lakhs. The petitioner appealed this order, which was pending before the Commissioner of Income Tax (Appeals) (CIT (Appeals)). The petitioner sought a stay of the demand, which was partially granted, allowing installment payments. However, the petitioner defaulted on the first installment, leading to the attachment of their bank account. The High Court dismissed the writ petition challenging this order.

The petitioner had paid Rs. 27.7 lakhs so far. The main reason for the assessment reopening was linked to proceedings under the Central Excise Act. The petitioner submitted additional documents showing a decision by the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), which set aside the Excise Department's order for fresh adjudication.

Considering this subsequent event, the Supreme Court directed the petitioner to approach the CIT (Appeals) again for a stay, highlighting the new developments. The Court expressed confidence that the CIT (Appeals) would review the application promptly and make a decision within four weeks of filing. Consequently, the special leave petitions were disposed of by the Supreme Court.

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