2023 (8) TMI 1078

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....said order are extracted hereafter: "2. The principal grievance of the petitioner is, that the respondents/revenue have adjusted against the refund payable qua Assessment Year (AY) 2022-23, demands outstanding with respect to AYs 2011-12, 2012-13 and 2013-14. 3. Mr Ajay Vohra, learned senior counsel, who appears on behalf of the petitioner, says that there are several flaws with regard to the steps taken by the respondents/revenue: (i) First, the adjustment made is more than 20% which is contrary to the Office Memorandum [in short, "OM"] dated 29.02.2016, as amended by OM dated 31.07.2017. (ii) Second, it disregards the fact that an appeal vis-a-vis the aforementioned AYs is pending adjudication with the ....

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....is right, which is, for making an adjustment over and above the stipulated percentage i.e., 20% of the disputed demand, in terms of the aforementioned OM dated 29.02.2016, the concerned officer will have to furnish reasons and satisfy himself, as to why disputed tax cannot be collected by other means if it ultimately bears fruition. 8. Accordingly, issue notice. 8.1 Mr Shailendera Singh, learned senior standing counsel accepts notice on behalf of the respondents/revenue. 9. Mr Singh will return with instructions. 9.1 In case instructions are received to resist the petition, a counter-affidavit will be filed before the next date of hearing. 10. List the matter on 07.08.2023." 2. Before we proce....

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....en drawn to the following part of the said communication: "Further in response to notice issued by CPC u/s 245 of Income Tax Act, 1961 the assessee company has agreed with disputed demand with the plea that" the assessee company has filed appeals before Ld CIT(A) against the penalty orders. Your honour is requested to kindly stay the disputed demand and not to treat the assessee in default till the disposal of first appeals before Ld. CIT(Appeals)". Even though the CPC has adjusted full disputed demand instead of adjusting 20 % demand as per CBDT circular. The same has caused working capital and cash flow issues to the company." 7. Besides this, our attention has also been drawn to the response dated 03.10.2022 to the notice iss....

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....ing heard is prayed. Thanking You" [Emphasis is ours] 8. It is the submission of the learned counsel for the petitioner/assessee that the AO did not provide any time to respond to the intimation dated 02.03.2023 proposing adjustment of outstanding demand against the refund due to the petitioner/assessee. Furthermore, according to the counsel for the petitioner/assessee, the AO was required to apply his mind and pass an appropriate order. 8.1 In this context, the counsel for the petitioner/assessee relies upon the judgment of a Division Bench of the Bombay High Court in Hindustan Unilever v. DCIT [2015] 377 ITR 281 (Bom). 9. Having heard the counsels for the parties, we are of the view that the impugned action of the AO in ....