IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 21ST DAY OF FEBRUARY, 2019 BEFORE THE HON’BLE MRS.JUSTICE S.SUJATHA WRIT PETITION No.8099 OF 2019 (T – IT) BETWEEN:
M/S. FIRE LUXUR DEVELOPERS PVT. LTD., A COMPANY INCORPORATED UNDER THE COMPANIES ACT, HAVING ITS OFFICE AT NO.239, THE EMPYREAN, ANCHE MUSKUR VILLAGE, LAKKUR HOBLI, CHIKKATHIRUPATHI POST, MALUR TALUK-563130.
REP. BY ITS AUTHORISED SIGNATORY MR. RAHUL JAIN, S/O. SHRI. RAVI CHAND JAIN, AGED ABOUT 52 YEARS.
... PETITIONER (BY SRI. HARISH.V.S, ADV.,) AND:
THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE 3(1) (1), ROOM NO.227, 2ND FLOOR, BMTC BUILDING, 6TH BLOCK, KORAMANGALA, BENGALURU-560 095.
... RESPONDENT (BY SRI. K.V.ARAVIND, ADV.,) THIS WP IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO DIRECT THE RESPONDENT TO WITHDRAW THE GARNISHEE NOTICES ISSUED TO THE PETITIONER'S BANKERS RELEVANT TO THE ASSESSMENT YEAR 2016-17 ANNEXURE-J DATED 12.02.2019.
THIS PETITION COMING ON FOR PRELIMINARY HEARING THIS DAY, THE COURT MADE THE FOLLOWING:
O R D E R The petitioner has sought for a writ of mandamus, directing the respondent to withdraw the Garnishee notices dated 12.02.2019 issued to the petitioner’s bankers relating to the Assessment Year 2016-2017.
2. It is the contention of the petitioner that pursuant to the assessment order passed under S.143(3) of the Income Tax Act, 1961 (‘the Act’ for short) relating to the assessment year in question, demand notice was issued by the respondent. A sum of Rs.81,66,632/- being ten percent of the disputed demand was paid by the assessee on 25.01.2019. It is further contended that First Appeal has been filed by the petitioner challenging the assessment order and the stay application filed by the petitioner has been disposed of by the respondent on 06.02.2019. Being aggrieved, the petitioner has filed the petition before the First Appellate Authority and during the pendency of the stay application before the First Appellate Authority, the garnishee notices were issued by the respondent. Subsequent to the filing of the writ petition, the department has recovered the amount of Rs.1,48,72,743/- from the bankers of the petitioner on 20.02.2019 by way of a Demand Draft and the same is not encashed so far. Accordingly, learned counsel for the petitioner seeks for a direction to the respondent to restore back the said amount to the account of the petitioner and permit the petitioner to agitate the matter before the Appellate Authority where the stay application is pending for consideration, directing the First Appellate Authority to dispose of the same within a time frame.
3. Learned counsel for the revenue would submit that in terms of the Office Memorandum (F.NO.404/72/93- ITCC) dated 29.02.2016, in case if the assessee is aggrieved by the order of stay, he / it has to move before the administrative Pr. CIT/CIT for a review of the decision of the Assessing Officer. The assessee has preferred an appeal before the Commissioner of Income-tax (Appeals) which is not maintainable. Hence, the petitioner having deposited ten per cent of the demand, if the balance ten percent is paid which is the order required to be passed by the Competent Officer in terms of the Notification dated 29.02.2016, the same shall be considered by the respondent.
4. Having heard the rival submissions of the learned counsel appearing for the parties, this Court finds that there is considerable force in the arguments advanced by the learned counsel for the revenue. That the Assessing Officer was empowered to grant an interim order of stay provided 20% of the disputed demand is paid by the assessee. However, it is not in dispute that 10% of the disputed demand is already paid by the assessee. In such circumstances, justice will be met if a direction is issued to the petitioner to deposit 10% of the balance disputed amount before the respondent within a period of two weeks.
Writ petition stands disposed of directing the respondent to restore the amount if any collected from the petitioner’s bankers pursuant to the garnishee notices issued impugned herein and withdraw the garnishee notices subject to the undertaking to be given by the petitioner that 10% of the disputed demand would be deposited within a period of two weeks from today.
Sd/- JUDGE sac*