Court limits AO's authority on remand, upholds refund adjustment, sets aside order review. Petitioner directed to pay balance.

The court held that the AO exceeded the scope of remand by revisiting the issue of granting a waiver beyond the initial 85%. The court upheld the adjustment of the refund amount but set aside the review of the previous order. The petitioner was directed to deposit the balance within two weeks, partially allowing the writ petition without costs.

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Issues Involved:
1. Non-compliance with the court's previous order.
2. Entitlement to stay of recovery of demands for AY 2014-15.
3. Consideration of top line credit adjustment and license fee adjustment.
4. Treatment of refund standing to the credit of the petitioner.
5. Review and scope of remand by the AO.

Issue-wise Detailed Analysis:

1. Non-compliance with the Court's Previous Order:
The petitioner contended that the court's order in W.P.(C) 1874/2017 had not been given effect to. The court had previously directed the AO to reconsider specific issues raised by the petitioner and make an appropriate order under Section 220(6) of the Income Tax Act, 1961.

2. Entitlement to Stay of Recovery of Demands for AY 2014-15:
The petitioner sought a stay of recovery of demands amounting to Rs. 4,18,13,06,110/- by depositing Rs. 62,71,95,920/-. The petitioner relied on the Central Board of Direct Taxes (CBDT) Office Memorandum (OM) dated 29.02.2016, which allowed for a stay of demand in excess of 15% under certain conditions. The court noted that the AO had initially granted a stay of demand subject to a substantial relief of 85%.

3. Consideration of Top Line Credit Adjustment and License Fee Adjustment:
The petitioner argued that the AO had not considered the top line credit adjustment and license fee adjustment, which amounted to substantial sums. The court had previously directed the AO to specifically address these issues. The AO, in the impugned order, concluded that the issues related to unearned revenue and depreciation on the increased cost of spectrum remained contentious and thus, the demand would remain unenforceable until the disposal of the appeal.

4. Treatment of Refund Standing to the Credit of the Petitioner:
The petitioner claimed a refund of Rs. 27,93,09,100/- for AY 2015-16 and AY 2016-17. The AO, in the impugned order, stated that the processing of the refund for AY 2015-16 could not be done due to a pending notice under Section 143(2). Similarly, for AY 2016-17, the necessary ticket for processing the ITR had not been forwarded by the CPC. Consequently, the refund could not be considered for passing the order under Section 220(6).

5. Review and Scope of Remand by the AO:
The court observed that the AO had exceeded the scope of remand by revisiting the entire issue of whether the relief of 85% waiver of demand deposit could be given. The court clarified that the AO was only required to consider whether further relief could be granted beyond the 85% waiver, as per the court's previous order. The AO's action of reviewing the previous order was not within the scope of the remand.

Conclusion:
The court held that the AO could not have revisited the matter as if there were a fresh or open remand. The court upheld the relief granted by the AO regarding the adjustment of the refund amount of Rs. 27,93,09,100/-. However, the impugned order, to the extent it reviewed the previous order of 22nd February 2017, was set aside. The petitioner was directed to deposit the balance amount of Rs. 34,78,86,820/- within two weeks, which would be sufficient compliance with the court's orders. The writ petition was partially allowed without any order as to costs.

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