Madras HC sets aside CIT’s
order directing Kaliagnar TV (‘assessee’) to pay 20% demand as a condition
precedent for staying demand of approx. Rs. 90 cr for AYs 2009-10 and 2010-11,
arising out of Sec. 68 addition in relation to the 2G matter; HC notes that
such direction was given by CIT / AO relying on CBDT Instruction No.1914 read
with the Office Memorandums of February, 2016 and July, 2017; Accepts
assessee’s stand that in view of pendency of appeals, the collection of
disputed demands arising out of unduly high pitched assessments should be
stayed till the appeals are heard and disposed of in terms of CBDT Instruction
96 of 1969; Firstly, HC notes that while CIT had held that the assessment
orders cannot be treated as high pitched, he had not given any reason as to why
in his opinion, the assessment is not high pitched; Next, HC rejects Revenue’s
stand that Instruction no. 96 was superseded by subsequent Instruction no. 1914
of 1993, cites Delhi HC ruling in Taneja Developers & Infrastracture Ltd.
to hold that Instruction No.96 is still in force and it binds the AOs; Further
remarks that the prima facie effect of the Special Court’s judgment (wherein
the accused persons including assessee have been acquitted) was required to be
considered by the CIT while examining the prayer for stay, especially since the
Assessee's consistent case has been that the income tax proceedings is a mirror
image of the proceedings initiated by the CBI.; On Revenue’s stand that no such
situation is contemplated to be considered for stay under CBDT Instruction
No.1914, HC clarifies that the instruction issued by the Board are illustrative
and not exhaustive; Lastly, HC makes it clear that this Court has not rendered
any finding on merits, directs assessee to file a stay petition before CIT(A)
who shall pass order on stay petition on merits after affording hearing
opportunity to assessee.:HC
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