2012 (4) TMI 268

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....s preferred by the petitioner before the Assessing Officer on 09.1.2012. On 23.1.2012, the respondents Assistant Commissioner passed an order on the application aforesaid, that reads as under: "I have carefully gone through the contents of your letter dated 09.1.2012. The issue raised by you in the said letter have already been dealt with at length while passing the assessment order in your case for A.Y. 2008-09. It is pertinent to mention here that merely filing an appeal against the assessment order before the appellate authority is not sufficient reason to stay the recovery of demand. Moreover, the Ld. CIT(A) has already adjudicated the issues in favour of the department. The UIT has sufficient funds for payment of demand as is appare....

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....me-tax. As the Department was not following the above mentioned instructions and so the matter was presented before the honourable Rajsthan High Court in the case of His Late Highness Maharaja Shri Bhagwat Singhji of Mewar v. Income-tax appellate Tribunal & Ors. Reported in (1996) 133 CTR at page 97. In this matter the honourable High Court have held that proposition cannot be disputed that the circulars issued by the CBDT are binding on the authorities exercising powers under the taxing statute and have sufficient force of law. From the perusal of the Instruction No. 96 F. No. 1/6/69-ITCC dated 21st August, 1969 it is clear that where the income determined on assessment was substantially higher than the returned income, twice the latter....

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....at it shall be the responsibility of the AO and the TRO to collect every demand that has been raised "except the following", which includes "(d) demand stayed in accordance with the pars B and C below". Para B relates to stay petitions. As extracted above, sub-cl. (iii) of para B clearly indicates that a higher/superior authority could interfere with the decision of the AO/TRO only in exceptional circumstances. The exceptional circumstances have bee indicated as - "where the assessment order appears to be unreasonably high pitched or where genuine hardship is likely to be caused to the assessee". The very question as to what would constitute the assessment order as being reasonably high pitched in consideration under the said Instruction No....