2020 (2) TMI 734

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....ecomes substantive and therefore, the petitioner was liable to pay a sum of Rs. 2,62,76,350/- as tax due for the said Assessment Year. The impugned order dated 28.03.2016 in W-I(2)/Tpr/2015-16 is pursuant to a representation of the petitioner dated 19.02.2016 and 03.02.2016. The petitioner has been asked to pay the demand and produce challan. 3. The facts of the case are that the petitioner manufacturer of hosiery item had signed an agreement dated 01.04.2009 with M/s.Eastman Exports Global Clothing Private Limited. Under the agreement, the said company had advanced a sum of Rs. 6.5 crores to the petitioner to improve the desired infrastructure facility. In the books of account of the petitioner, the aforesaid amount was treated as an ad....

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....ure could not be allowed under Section 37(1) of the Income Tax Act, 1961, the aforesaid amount paid to the petitioner was to be protectively assessed till the issue was finally decided in the case of M/s. Eastman Exports Global Clothing Private Limited. 9. The petitioner preferred an appeal before the Commissioner of Income Tax (Appeals) against the protective Assessment Order dated 18.03.2013 of the Assessing Officer. The said appeal was disposed by the Commissioner of Income Tax (Appeals) by an order dated 23.06.2014 with the following observations:- "In view of the fact that the amount ofRs. 6,50,00,000 has been confirmed as capital expenditure in the case of M/s.Eastman Exports Global Routing Private Limited, the protective ....

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....ondent has also filed a further appeal before this High Court and therefore the present writ petition is liable to be dismissed as premature. 14. I have considered the arguments advanced by the learned counsel for the petitioner and the Senior Standing Counsel for the respondent. 15. The question of making protective demand based on the assessment of the person who paid the amount the petitioner appears to be incorrect as assessment cannot be made subject to outcome of collateral proceedings of another person. 16. Assessment has to be completed based on the accounts of the petitioner. It cannot be left open ended as has been done in the case of the petitioner. The petitioner has also successfully challenged the assessment order dat....