By TIOL News Service

CHENNAI, NOV 21, 2018: THE ISSUE BEFORE THE HIGH COURT IS - Whether Revenue Authorities should refrain themselves from initiating recovery proceedings, during pendency of appeal & stay petition against order of assessment & demand. YES IS THE VERDICT.

Facts of the case:

The assessee, an individual, had preferred the present petition challenging the proceedings, whereby he was called upon to pay the demand of tax with interest on the reason that mere filing of appeal against the order of assessment was not a bar for recovering the tax due.

High Court held that,

++ it is seen that in respect of A.Y 2011-2012, an order of assessment was passed and the matter was taken up for appeal by the assessee before the CIT(A) and further before the ITAT. It is further seen that the Tribunal has remitted the matter back to the AO to re-examine the matter afresh in the light of the material available on record and thereafter, decide the issue afresh in accordance with law. Consequently, the AO has passed an order of assessment and the rectification petition filed by the assessee has also came to be dismissed. The assessee therefore went on appeal before the FAA along with the stay petition. It is not in dispute that the stay petition is pending before the FAA and in the meantime, recovery proceedings came to be issued;

++ the grievance of the assessee before this Court is that since the stay petition is pending before the FAA, the AO is not justified in issuing the demand without even waiting for an order to be passed by the FAA in the stay petition. The Revenue's counsel admitted the fact that the stay petition filed by assessee is still pending before the FAA. When such being the factual position, this Court is of the view that it is for the FAA to consider the stay petition and pass orders on the same on merits and in accordance with law, without loss of further time.

(See 2018-TIOL-2443-HC-MAD-IT)