Court denies intervention under Article 226 in tax assessment challenge, grants installment scheme.

The court declined to intervene under Article 226 of the Constitution of India in a case challenging a re-assessment order for the assessment year 2014-15 under the Income Tax Act, 1961. An order was issued granting an installment payment scheme to the petitioner, requiring the payment of five equated monthly installments starting from February 2020. The petitioner was permitted to file a stay application before the Commissioner of Income Tax (Appeals) within two weeks, with a directive to remit 10% of the disputed tax amount immediately. Failure to comply would result in the revival of the Assessing Authority's order.

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Issues:
Challenge to re-assessment order for assessment year 2014-15 under the Income Tax Act, 1961.

Analysis:
The petitioner challenged an order of re-assessment for the assessment year 2014-15 under the Income Tax Act, 1961. One of the grounds raised was the absence of a separate speaking order by the Assessing Authority, citing the Supreme Court's judgment in the case of GKN Driveshafts (India) Ltd. vs. Income Tax Officer and Others (259 ITR 19). The petitioner also objected to the flawed basis of the proceedings initiated. Despite this, the petitioner filed a statutory appeal before the Commissioner of Income Tax (Appeals) within the stipulated time. Consequently, the court declined to intervene under Article 226 of the Constitution of India.

The petitioner requested an interim stay of demand, which was considered by the court. An order was issued on 17.02.2020, granting a scheme of installment payment to the petitioner. The installment scheme included five equated monthly installments to be paid by the 30th of each month, starting from February 2020. The petitioner confirmed not having made any payments towards the disputed demand, which amounted to Rs. 42,43,57,970, with a tax component of Rs. 25,11,05,384.

The court permitted the petitioner to file a stay application before the Commissioner of Income Tax (Appeals) within two weeks. It directed the petitioner to remit 10% of the disputed tax amounting to Rs. 25,11,05,384 immediately. The stay application, if filed within the specified timeline and upon compliance with the imposed terms, would be heard and disposed of within four weeks from the date of filing. Failure to file the stay application within the given timeline would result in the revival of the Assessing Authority's order, leading to the automatic vacation of the earlier granted stay.

Consequently, the writ petition was disposed of in the mentioned terms, and connected miscellaneous petitions were closed without any costs being imposed.

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