M/S TOSHIBA CORPORATION vs. COMMISSIONER OF INCOME TAX, (INTL. TAX)-3, NEW DELHI AND ANR.

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W.P.(C)-8629/2022HC Delhi2022:DHC:213630 May 20222 pages
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What did the High Court hold?

The High Court held that it found no grounds to interfere with the impugned order dated 5th May, 2022. The reasoning was based on the petitioner not having claimed financial hardship, which meant the criterion of irreparable injury was not satisfied. The Court clarified that the 20% deposit made by the petitioner would abide by the final order of the Commissioner in the appeal and would be refundable if the petitioner succeeded. The Court directed the CIT(A) to dispose of the petitioner's appeal expeditiously, preferably within six months. The time to comply with the 5th May, 2022 order was extended by four weeks.

What were the facts?

The petitioner, M/s Toshiba Corporation, filed a writ petition challenging an order dated 5th May, 2022, which directed them to deposit 20% of the disputed amount. This order stemmed from proceedings under Sections 201(1)/201(1A) of the Income Tax Act, 1961, and a demand notice under Section 156 of the Act, both dated 12th November, 2021, for Assessment Year 2016-17. The petitioner also sought a direction for the expeditious disposal of their appeal by the Commissioner of Income Tax (Appeals). The High Court noted that while deciding a stay application, the Assessing Officer and CIT(A) must consider a prima facie case, balance of convenience, and irreparable injury. The petitioner did not claim financial hardship, thus not satisfying the irreparable injury criterion.

What were the issues?

1. Whether the High Court should interfere with the impugned order dated 5th May, 2022, directing the Petitioner to deposit 20% of the disputed amount, considering the criteria for stay applications (prima facie case, balance of convenience, irreparable injury) under the Income Tax Act, 1961. Assessee's Contention: The petitioner sought a direction for the expeditious disposal of their appeal and challenged the order directing a 20% pre-deposit. The judgment does not explicitly record the petitioner's arguments regarding the merits of the pre-deposit order itself, beyond seeking its review in the context of the stay application criteria. Revenue's Contention: The judgment does not record any specific arguments made by the revenue.

Which sections of the Income-tax Act were involved?

Section 201(1),Section 201(1A),Section 156

AI-generated summary — verify with the full judgment below

W.P.(C) No.8629/2022 Page 1 of 2 $~35 * IN THE HIGH COURT OF DELHI AT NEW DELHI + W.P.(C) 8629/2022 & CM APPL.25939/2022 M/S TOSHIBA CORPORATION ..... Petitioner Through: Mr. Deepak Chopra and Mr. Ankul Goyal, Advocates. versus COMMISSIONER OF INCOME TAX, (INTL. TAX)-3, NEW DELHI AND ANR. ..... Respondents Through: Mr. Ruchir Bhatia, Advocate. % Date of Decision: 30th May, 2022 CORAM: HON'BLE MR. JUSTICE MANMOHAN HON'BLE MS. JUSTICE MANMEET PRITAM SINGH ARORA J U D G M E N T MANMOHAN, J (Oral): 1. Present writ petition has been filed challenging the order dated 5th May, 2022 directing the Petitioner to deposit 20% of the disputed amount as well as order under Sections 201(1)/201(1A) of the Income Tax Act, 1961 [for short ‘the Act’] and the demand notice issued under Section 156 of the Act both dated 12th November, 2021 for the Assessment Year 2016-17. Petitioner also seeks a direction to the respondent to dispose of the Petitioner’s appeal expeditiously. 2. Admittedly, while deciding the stay application, the Assessing Officer 2022:DHC:2136-DB

W.P.(C) No.8629/2022 Page 2 of 2 and the CIT(A) have to consider three primary issues i.e. prima facie case, balance of convenience and irreparable injury. 3. In the present case, the petitioner has not claimed financial hardship. Accordingly, the third factor i.e. irreparable injury is not satisfied. 4. Consequently, this Court finds no ground to interfere with the impugned order dated 5th May, 2022. 5. This Court clarifies that the benefit of the amount deposited by the petitioner in pursuance to the order dated 5th May, 2022 shall not be given to the three payees and the said pre-deposit amount shall abide by the final order to be passed by the Commissioner in the appeal. Needless to state that, in the event, Petitioner succeeds in its appeal, the Petitioner shall be entitled to refund of the entire amount deposited by it. 6. However, this Court directs the CIT(A) to dispose of the Petitioner’s appeal as expeditiously as possible, preferably, within six months from today. At the request of learned counsel for the petitioner, this Court also extends the time to comply with the order dated 5th May, 2022 for a period of four weeks. 7. With the aforesaid direction, the present writ petition and pending application stand disposed of. MANMOHAN, J MANMEET PRITAM SINGH ARORA, J MAY 30, 2022 AS 2022:DHC:2136-DB

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