# Uttar Pradesh Bhumi Sudhar Nigam Lko v. Principal Commissioner of Income Tax & Ors

- **Citation:** (2016) 1 ILRA 231
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2016-02-03
- **Case number:** Misc. Bench No. 2238 of 2016
- **Bench:** Amreshwar Pratap Sahi, Attau Rahman Masoodi
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/uttar-pradesh-bhumi-sudhar-nigam-lko-v-principal-commissioner-of-income-tax-ors-43412
- **Pages:** 4

## Headnote

Income Tax Act 1961-Section 220(6)-
Pendency of Appeal-against assessment
order
assessee
to
approach
before
assessment officer-to get interim protection.
Held: Para-12
In the circumstances of the case, we leave
it open to the petitioner to approach the
assessing officer under Section 220 (6) of
the Act within a period of two weeks from
today and in case any application is filed by
the petitioner before the assessing officer,
he
shall
pass
necessary
order
after
affording an opportunity to the petitioner
within three months from the date of filing
of any such application. Until decision on
the application, filed if any, or until decision
of the appeal itself within a period of three
month, the recovery proceedings in relation
to the assessment year 2012-2013 for the
disputed amount shall remain in abeyance
and the same shall abide by to the outcome
of the appeal.
Case Law discussed:
[1994] 208 ITR 461 (All); (2010) 321 ITR 491
(All.); (1969) 71 ITR 815; (1985) 154 ITR 172;
AIR 1956 All. 130; AIR 1957 Andhra Pradesh
114; AIR 1957 Andhra Pradesh 671.

## Text

1 All. Uttar Pradesh Bhumi Sudhar Nigam Lko. Vs. Principal Commissioner of Income Tax & Ors.
231
ORIGINAL JURISDICTION
TAXATION SIDE
DATED: LUCKNOW 03.02.2016
BEFORE
THE HON'BLE AMRESHWAR PRATAP SAHI, J.
THE HON'BLE ATTAU RAHMAN MASOODI, J.
Misc. Bench No. 2238 of 2016
Uttar Pradesh Bhumi Sudhar Nigam Lko.
 ...Petitioner
Versus
Principal Commissioner of Income Tax &
Ors.
 Respondents
Counsel for the Petitioner:
Pradeep Agarwal
Counsel for the Respondents:
Manish Misra
Income Tax Act 1961-Section 220(6)-
Pendency of Appeal-against assessment
order
assessee
to
approach
before
assessment officer-to get interim protection.
Held: Para-12
In the circumstances of the case, we leave
it open to the petitioner to approach the
assessing officer under Section 220 (6) of
the Act within a period of two weeks from
today and in case any application is filed by
the petitioner before the assessing officer,
he
shall
pass
necessary
order
after
affording an opportunity to the petitioner
within three months from the date of filing
of any such application. Until decision on
the application, filed if any, or until decision
of the appeal itself within a period of three
month, the recovery proceedings in relation
to the assessment year 2012-2013 for the
disputed amount shall remain in abeyance
and the same shall abide by to the outcome
of the appeal.
Case Law discussed:
[1994] 208 ITR 461 (All); (2010) 321 ITR 491
(All.); (1969) 71 ITR 815; (1985) 154 ITR 172;
AIR 1956 All. 130; AIR 1957 Andhra Pradesh
114; AIR 1957 Andhra Pradesh 671.
(Delivered by Hon'ble A. R. Masoodi, J.)
1. Heard Sri Pradeep Agarwal,
learned counsel for the petitioner and Sri
Manish Misra, learned counsel who has
accepted
notice
on
behalf
of
the
respondents.
2. By means of this writ petition, the
petitioner has assailed the recovery notice
issued by the assessing officer on
3.11.2015 in respect of the amount due
for the assessment year 2012-13.
3. The contention of the learned
counsel for the petitioner is that the
petitioner has already filed an appeal
against the assessment order passed by the
assessing authority in relation to the
assessment year 2012-13 and has also
filed an application for the grant of
interim stay against the assessment order.
The appeal as well as interim stay
application are pending before the C.I.T.
(Appeals) i.e. respondent no. 2.
4. Referring to Section 220 (6) of
the Income Tax Act, 1961, it is argued
that since the assessee has preferred an
appeal against the assessment order, it is
not open to the authorities to proceed with
the recovery pursuant to the assessment
order once the appeal is pending. This
argument has been raised on the strength
of Section 220 (6) of the Income Tax Act
and the same is extracted below:
"220 (6) Where an assessee has
presented an appeal under section 246,
the Assessing] Officer may, in his
discretion, and subject to such conditions
as he may think fit to impose in the
circumstances of the case, treat the
assessee as not being in default in respect
of the amount in dispute in the appeal,
232
 INDIAN LAW REPORTS ALLAHABAD SERIES
even though the time for payment has
expired, as long as such appeal remains
undisposed of."
5. The aforesaid provision clearly
refers to the appeal filed under Section
246 or 246-A of the Act and to this extent
there is no dispute with regard to the
pendency of appeal being filed by the
petitioner alongwith an application for
interim stay. However, the difficulty has
arisen due to the fact that the appellate
authority not being empowered with the
jurisdiction of granting interim stay under
the appellate jurisdiction, can it be said
that such a jurisdiction is either ancillary
or incidental to the appellate power under
Section 246 or 246-A particularly when
Section 220(6) of the Act regulates the
situation in a different manner.
6. The assessing officer, it is
provided under the Statute, while the
appeal remains undisposed of, may
impose the conditions as he thinks fit in
the circumstances of the case so as to treat
the assessee as not being in default in
respect of the amount in dispute. The
plain reading of Section 220(6) of the Act
rather imposes a restriction on the
appellate authority not to entertain any
interim stay application leaving the matter
open to be dealt with by the assessing
authority during the course of pendency
of appeal, inter alia, by establishing his
due co-operation in the pending appeal or
pointing out the failure on the part of the
appellate authority to decide the appeal
despite his cooperation.
7. The intention of the statute is very
clear to the extent that an assessee during
pendency of an appeal has primarily to
satisfy the assessing officer under Section
220(6) at the first instance for seeking
deferment as regards the execution of an
assessment order. In the present case, the
petitioner admittedly has filed an appeal
alongwith an application for interim stay
but the fact remains that the petitioner has
not approached the assessing officer
under Section 220 (6) for the exercise of
his discretion to defer the recovery
proceedings.
8. Learned counsel for the petitioner
while arguing the matter, has referred to
the judgements rendered in the case of
Prem Prakash Tripathi v. Commissioner
of Income-tax and others, [1994] 208 ITR
461 (All) and the judgement reported in
(2010) 321 ITR 491 (All.): Smita
Agarwal (Individual) v. Commissioner of
Income Tax and others, and it is urged,
that in terms of the law settled by this
Court,
the
proposition
that
during
pendency
of
an
appeal,
recovery
proceedings have to be stayed during
pendency of appeal or at least till the
disposal of interim stay application, is
inevitable.
9. From a perusal of the aforesaid
decisions, it is seen that the High Court
has read the authority of dealing with the
interim stay applications by the first
appellate authority under Section 246 or
246-A, keeping in view the law laid down
by the apex court in the case of ITO V. M.
K. Mohammed Kunhi (1969) 71 ITR 815,
wherein the following observation has
been made:
"But the Appellate Tribunal must be
held to have the power to grant stay as
incidental or ancillary to its appellate
jurisdiction."
10. The apex court in the decision
mentioned supra while dealing with the
1 All. Uttar Pradesh Bhumi Sudhar Nigam Lko. Vs. Principal Commissioner of Income Tax & Ors.
233
provision of Section 255 (5) of the Act,
opined that once the tribunal had an
authority to regulate its procedure to deal
with the appeals, in that situation the
power to grant stay can be read as
incidental or ancillary to its appellate
jurisdiction. The situation in the present
case is different inasmuch as during
pendency of an appeal under Section 246
or 246-A, the power of interim stay
instead of being conferred upon the
appellate authority is rather, vested with
the assessing officer by virtue of Section
220 (6). The power conferred on the
assessing officer in view of the aforesaid
provision
by
its
very
nature,
is
discretionary but at the same time it is to
be read so long as an appeal remains
pending or undisposed of by the appellate
authority under Section 246 or 246-A of
the Act. The assessee, in such a situation,
is left with no other remedy except to
approach the assessing officer for the
exercise of his discretioni conferred under
Section 220 (6). The intention of
restricting
the
power
of
appellate
authority to grant interim stay may have a
purpose of dealing with such appeals by
the
appellate
authority
expeditiously
which in the event of grant of interim stay
would prolong the proceedings due to
non-cooperation of the assessee like in the
present case where appeal is pending
since last about a year.
11. It is not the case of the petitioner
that he has filed any application under
Section 220 (6) of the Act for seeking an
order of interim stay within the scope of
said provision but what is argued is that the
assessee once having exercised the right of
appeal, is entitled to a protection of not
being treated to be an assessee in default as
a natural consequence of the mere filing of
an appeal. In our considered opinion, this
proposition in the context of the case laws
referred to above is not the correct
proposition of law and is contrary to the
legislative intention. The scheme of the Act
provides a specific remedy under Section
220 (6) and the same having not been
invoked by the petitioner in the present
case, does not entitle him to the protection
as has been prayed for on the ground of
mere pendency of the appeal or till the
disposal of interim stay application. From
the perusal of impugned notice dated
3.11.2015, we do find that the assessing
authority has not considered the aspect of
the pendency of appeal nor the grievance
raised by the petitioner to this effect has
been considered in accordance with law but
at the same time it is found that the
petitioner has not brought any material
whatsoever to the knowledge of the
assessing authority. Although the petitioner
has also made a reference to some circulars
issued by CBDT but the same are not filed
before the Court nor before the assessing
authority, therefore, the Court has no choice
except to interpret the intention of
legislation from its plain reading. In civil
disputes Order XLI Rule 5 and 6 Code of
Civil Procedure, 1908 specifically confer
jurisdiction on the appellate court or the
court passing the decree for stay of
orders/decree appealed against or for
imposing conditions to secure the ends of
justice. The benefit of Section 144 CP.C. is
also available to a litigant in all judicial
proceedings, therefore, the exclusion of
power of interim stay at the first appellate
stage under Income Tax Act, 1961 has to be
read in the manner provided for in Section
220 (6) of the Act but not otherwise. The
provisions of Section 144 C.P.C. may not
be applicable to the proceedings under the
Income Tax Act, 1961 but the principles do
apply. It is true that an appeal is the
continuity of proceedings but the legislative
234
 INDIAN LAW REPORTS ALLAHABAD SERIES
intention of securing the interest of revenue
by imposing just conditions at the first
appellate stage, can also not be held to be
arbitrary and reading a principle contrary to
the intention of Section 220 (6) amounts to
adding
something
in
the
appellate
jurisdiction which the law neither expressly
nor by implication does provide. The apex
court judgement placed reliance upon in the
Division Bench judgements cited before us,
does appear to have led to the incorporation
of Rule 35-A in the Rules of 1963 but no
such amendment was made in pursuance of
the apex court judgement incorporating any
such provision which may authorise the
appellate
authority
at
the
stage
of
proceedings under Section 246 or 246-A to
pass an interim stay order. The position of
law becomes further doubtful when it is
noticed that the writ petition in the case of
Prem
Prakash
Tripathi
(supra)
was
dismissed, as such a direction issued therein
becomes binding merely between the
parties and is not a judgement in rem. On
the other hand, looking to the scheme of the
Act and law laid down by the apex court in
the case of Assistant Collector of Central
Excise v. Dunlop India Ltd. (1985) 154 ITR
172 and the judgements reported in AIR
1956 All. 130: Goverdhan Lal Jagdish
Kumar v. Commissioner of Income Tax and
others;
AIR
1957
Andhra
Pradesh
114:Vetcha Sreeamamurthy v. Income Tax
Officer and another and AIR 1957 Andhra
Pradesh
671:
Shrimathi
Mokhamatla
Mondamma and another v. Shrimathi
Mokhamatla Venkatalakshmidevi, we are
not in agreement with the proposition of law
as has been canvassed by the learned
counsel for the petitioner in the writ
petition. It is, however, open to the CBDT
to issue guidance to the assessing authority
to deal with the matters, during pendency of
the appeals filed under Section 246 and
246-A so that the recovery of revenue of
direct taxes may not suffer a set back and
the
assessee
is
equally
relieved
of
unnecessary torture.
12. In the circumstances of the case,
we leave it open to the petitioner to
approach the assessing officer under
Section 220 (6) of the Act within a period
of two weeks from today and in case any
application is filed by the petitioner
before the assessing officer, he shall pass
necessary
order
after
affording
an
opportunity to the petitioner within three
months from the date of filing of any such
application.
Until
decision
on
the
application, filed if any, or until decision
of the appeal itself within a period of
three month, the recovery proceedings in
relation to the assessment year 2012-2013
for the disputed amount shall remain in
abeyance and the same shall abide by to
the outcome of the appeal.
13. With the aforesaid observations,
the writ petition is disposed of.
-------
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: LUCKNOW 25.02.2016
BEFORE
THE HON'BLE RAJAN ROY, J.
Service Single No. 3426 of 2016
Mohd. Ishtiaq
 ...Petitioner
Versus
State of U.P. & Ors.
...Respondents
Counsel for the Petitioner:
Alok Mishra
Counsel for the Respondents:
C.S.C., Amit Kr. Singh Bhaduriya
Indian Evidence Act-Section 107 and
108-presumption of Civil death father of