TaxTMI 
TaxTMI 
2009 (1) TMI 87
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....e CIT (A) has disposed of the stay applications by directing the petitioner to pay 10% of the demands raised for A.Y. 2005-06 and A.Y. 2006-07 by 30-1-2009 and further directed the petitioner to pay a sum of Rs.50 lakhs by 27^th of every month till the appeals are heard and disposed of. 3. The petitioner - trust which was established in the year 1993 to impart education in different branches had obtained registration under Section 12A of the Income Tax Act, 1961 ('Act' for short) on 17-1-1994 as a result whereof the income of the assessee was exempted from payment of income tax. 4. On 20-7-2005, the premises of Shri M. N. Navale, principal trustee of the petitioner was searched wherein cash amounting to Rs.1.20 crores as well as....
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....alf of the petitioner submitted that the C.I.T. (A) having fixed the appeals for final hearing on 4-2-2009 ought to have stayed the demands till the disposal of the appeals. He submitted that the petitioner - trust duly registered under Section 12A of the Act is exempted from payment of tax. However, high-pitched assessments have been made by arbitrarily denying the exemption and huge demands have been raised. Relying on the C.B.D.T. instruction No.96 dated 21-8-1969, Mr.Mistry submitted that where the income determined was substantially higher than the returned income, say twice the later amount or more, the assessing officer was bound to hold in abeyance the collection of tax in dispute till the decision on the appeals provide....
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.... payment of Rs.1.5 crores by 30-1-2009 and if that order is enforced, it would cripple the operations of the petitioner and adversely affect the career of over 36,500 students and more than 5000 employees. He submitted that the cash and bank balance of the petitioner as on 17-1-2009 was Rs.1.18 crores whereas the liabilities as on 17-1-2009 was Rs.40.93 crores. Moreover, the petitioner is running a free General and Dental Hospital and its liability is to the tune of Rs.2.34 crores. Accordingly, Mr. Mistry submitted that it is impossible for the petitioner to pay 10% of the demand which comes to approximately Rs.1.5 crores. Alternatively, Mr. Mistry submitted that the petitioner may be directed to furnish bank guarantee in the su....
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....not comparable with the assessments made for A.Y. 1999-2000 to A.Y. 2004-2005. Therefore, absolute stay granted for those years have no bearing while dealing with the stay applications for A.Y. 2005-06 and A.Y. 2006-07. 12. Perusal of the assessment order for A.Y. 2006-07 shows that the addition of Rs.22.45 crores has been made as undisclosed income on account of donations received for granting admission to the students. In para 5 of the assessment order, the A.O. has referred to the letters addressed by reputed persons including M.L.A. and M.P. to the principal trustee requesting for reduction in fees / donations from the students named therein. In para 5.2, the A.O. has referred to a sample slip found at the residence of Mr....
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....ioner should be directed to deposit the tax as ordered by the C.I.T. (A) is the question before us. 15. It is contended by the petitioner that every document seized during the course of search has been properly explained. However, in the absence of any specific statement made before the A.O. or in the writ petition to the effect that no donation has been received or whatever donation received has been accounted for in the books maintained by the petitioner, we find it difficult to accept the contention of the petitioner. 16. Reliance placed by the petitioner on the Board's instruction No.96 is misplaced because the said instruction is not intended to cover cases where the income of the Public Trust is found to have been siphoned of in....
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....ore us, the dispute is regarding the income allegedly earned by the petitioner and the liability to tax income at the hands of the petitioner trust having registration under Section 12A of the Act. Moreover, the instruction / circular issued by the Board empowers the tax authorities to grant total stay of demand in appropriate cases till the disposal of the appeal. Even Section 220 (6) of the Act confers powers on the assessing officer to exercise discretion and treat the assessee as being not in default in respect of the amount in dispute on such conditions as he deems fit, even though time for payment has expired and the appeal is pending. Thus, the decision of the Apex court relied upon by the Counsel for the revenue is distinguish....