2026 (5) TMI 905

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....ssessing Officer and an appeal is pending before the CITA for Assessment Year 2023-24. The issues involved herein are as follows:- i) Whether the Department can adjust a refund against the disputed demand when a Stay Application and Appeal are pending. ii) Whether such adjustment violates the principles of natural justice and statutory safeguard under the income Tax Act. iii) The Learned counsel for the petitioner submits that the refund for Assessment Year 2021-22 has been determined and has become due to the petitioner. Without issuing any notice or affording any opportunity of hearing the respondents adjusted the said refund against the demand for Assessment Year 2023-24. It is further contended that for Assess....

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....nd relating to other assessment years are arbitrary and not sustainable in law. Accordingly, the respondent Income Tax Authority concerned is directed to refund the amount in excess of 20% which has been recovered from the refund of assessment years 2010-11 and 2017-18 for recovery of the demand arising out of the assessment orders relating to assessment years 2011-12, 2012-13 and 2013-14 against which appeals are pending before the CIT (Appeals), within a period of four weeks from the date of communication of this order subject to verification of the actual amount recovered and for this purpose respondent Income Tax Authority concerned shall afford an opportunity of hearing to the petitioner if required for clarification in support of such....

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....r the purpose of any clarification in respect of the petitioner's claim as regards the amount recovered. 17. it is submitted that the appeal that has been preferred before the CIT (Appeals) under Section 246A of the Income Tax Act, 1961 has been pending since 2021. In such view of the matter, the appellate authority being the respondent no. 6 herein is requested to expedite the hearing of the appeal and dispose of the same as early as possible." 5. The learned counsel appearing for the respondent submits that under Section 245 the Assessing Officer is empowered to set off refund against any tax due under the Act. 6. It is further contended that pendency of a stay application or appeal does not automatically bar adjustment. Th....