TaxTMI 
TaxTMI 
2013 (7) TMI 199
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....he Income Tax Act, considered the petitioner's application for stay of demand for the assessment year 2010-2011 vide assessment order dated 6.3.2013 passed by him under Sections 143 (3)/144 of the Income Tax Act, assessing the petitioner's income at Rs.25,47,06,391/- as against the returned income of Rs.9,89,64,181/-. The Assessing Officer added Rs.12,52,16,415/- applying the G.P. rate of 40.12 % after rejecting books of accounts under Section 145 of Income Tax Act, and disallowed the excess excise duty of Rs.3,05,25,795/-. 3. The petitioner has filed an appeal against the assessment order, after which he approached the Assessing Authority for stay of demand. 4. The Assessing Officer considered the facts and circumstances of the case and ....
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....e, the collection of the tax in dispute should be held in abeyance till the decision on the appeals, provided there were no lapse on the part of the assessee." 6. It is submitted by Shri Anand that as indicated in the instruction no.96 dated 21.8.1969 of CBDT, if the assessed income is more than twice the returned income, the guidelines given by CBDT will be applicable for staying the demand in totality, and not to treat the assessee as defaulter until the first appeal is decided. He relies upon instruction no.95 dated 14.9.1970; instruction no.635 dated 12.11.1973; clarification to instruction no.95 dated 13.7.1976; instruction no.1067 dated 21.6.1977; instruction no.1158 dated 27.3.1978; instruction no.1282 dated 4.10.1979; instruction n....
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....sons for doing so. Merely filing an appeal against the assessment order will not be sufficient reason to stay the recovery of demand. It also states that higher superior authority should interfere with the decision of the A.O. only in exceptional circumstances where the assessment order appears to be unreasonably high pitched or where genuine hardship is likely be caused to the assessee." 9. Section 220 (6) of the Income Tax Act, 1960 gives a discretion to the Assessing Authority to treat an assessee as not being in default in respect of the amount in dispute in the appeal, even though the time for payment had expired and the appeal has remained undisposed of. The discretion conferred under Section 220 (6) has to be exercised in accordance....
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....t order as being reasonably high pitched in consideration under the said Instruction No. 96 and, there it has been noted by way of illustration that assessment at twice the amount of the returned income would amount to being substantially higher or high pitched. In the case before this Court in Valvoline Cummins Ltd. (supra) the assessee's income was about eight (8) times the returned income. This Court was of the view that was high pitched. In the present case, the assessed income is approximately 74 times the returned income and obviously, this would fall within the expression 'unreasonably high pitched. In view of these circumstances, we direct that the impugned notices shall be kept in abeyance till the jurisdictional Comm....
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.... law has an abiding value in our legal regime. No public authority including the revenue can ignore the principle or precedent. 13. In our opinion, unlike the cases under Section 35F of the Central Excise Act, a strong prima facie case is not the indicator nor would be a motivating factor or consideration in exercising the discretion under Section 220 (6) of the Act. It is a different matter where the assessing officer ignores the settled principle of law or a binding decision of the Court, the guiding principles for excercising discretion for holding that the assessee is not in default, if he deposits part of the amount is, where the assessment order appears to be unreasonably high-pitched or where genuine hardship is likely to be caused ....