{"id":4568,"date":"2012-03-22T10:07:53","date_gmt":"2012-03-22T10:07:53","guid":{"rendered":"http:\/\/itatonline.org\/archives\/?p=4568"},"modified":"2012-03-22T10:07:53","modified_gmt":"2012-03-22T10:07:53","slug":"nishith-madanlal-desai-vs-cit-bombay-high-court","status":"publish","type":"post","link":"https:\/\/itatonline.org\/archives\/nishith-madanlal-desai-vs-cit-bombay-high-court\/","title":{"rendered":"Nishith Madanlal Desai vs. CIT (Bombay High Court)"},"content":{"rendered":"\n\n
Click here to download the judgement (nishit_desai_stay_order.pdf) <\/strong> <\/a><\/p><\/td>\n<\/tr>\n<\/table>\n


\nAO & appellate authorities are not mere tax gatherers; have duty to be fair to the assessee<\/p>\n

<\/strong><\/p>\n

The assessee, a professional, offered income of Rs.19.41 crores. The AO passed an assessment order u\/s 143(3) assessing the total income at Rs.22.43 crores and raised a demand of Rs.1.18 crores. The assessee filed a stay application before the CIT (A) who directed that a refund of Rs. 78 lakhs due for a subsequent year be adjusted and the balance of Rs.41 lakhs be paid. The CIT (A) held that considering \u201cthe financial status and affairs<\/em>\u201d of the assessee, the payment of the balance demand would not cause financial hardship. The assessee filed a Writ Petition to challenge the rejection of the stay application. HELD by the Court allowing the petition:<\/p>\n

The power which is vested in the AO u\/s 220(6) and on the CIT (A) to grant a stay of demand is a judicial power<\/strong>. It is necessary for both the AO as well as the appellate authorities constituted under the Income-tax Act to have due regard to the fact that their function is not merely to act as tax gatherers, but equally as quasi judicial authorities, they owe a duty of fairness to the assessee<\/strong>. This seems to be lost sight<\/strong> of in the manner in which the authority has acted in the present case. The parameters for the exercise of the jurisdiction to grant a stay of demand has been set out in several judgments of this Court, including in KEC International vs. B.R.Balakrishnan<\/strong> 251 ITR 158. The assessee\u2019s submissions on merits require consideration. The CIT (A) ought to have devoted a more careful consideration to the issue as to whether a stay of demand was warranted. As out of a total demand of Rs.1.18 crores, Rs.78 lakhs has been adjusted, the balance has to be stayed.<\/p><\/blockquote>\n

\nSee also M\/s Maheshwari Agro Industries vs. UOI<\/a><\/strong> (Rajasthan High Court) on high-pitched assessments<\/p>\n<\/div>\n

<\/p>\n","protected":false},"excerpt":{"rendered":"

The power which is vested in the AO u\/s 220(6) and on the CIT (A) to grant a stay of demand is a judicial power<\/strong>. It is necessary for both the AO as well as the appellate authorities constituted under the Income-tax Act to have due regard to the fact that their function is not merely to act as tax gatherers, but equally as quasi judicial authorities, they owe a duty of fairness to the assessee<\/strong>. This seems to be lost sight<\/strong> of in the manner in which the authority has acted in the present case. The parameters for the exercise of the jurisdiction to grant a stay of demand has been set out in several judgments of this Court, including in KEC International vs. B.R.Balakrishnan<\/strong> 251 ITR 158. The assessee\u2019s submissions on merits require consideration. The CIT (A) ought to have devoted a more careful consideration to the issue as to whether a stay of demand was warranted. As out of a total demand of Rs.1.18 crores, Rs.78 lakhs has been adjusted, the balance has to be stayed<\/p>\n

Read more ›<\/a><\/div>\n

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