Law:

Section:

Section 220 of the Income-tax Act, 1961 - Collection and recovery of tax - When tax payable and when assessee deemed in default - Assessment years 1994-95 and 1998-99 - Consequent upon a demand of Rs. 35.52 crores raised against assessee-company, assessee approached Assistant Commissioner with a prayer for stay of demand till disposal of its appeal against Commissioner (Appeals)'s order, on ground of its bad financial position and severe liquidity position - Assistant Commissioner, however, directed assessee to pay Rs. 5 crores immediately and balance in six equal monthly instalments in next six months - Whether since assessee had been conferred with right of appeal along with right to file an application for stay of demand appealed against before Tribunal, until application of assessee for stay of demand appealed against was considered and order was passed by Tribunal, demand appealed against was to be stayed - Held, yes Dr. A.K. Saraf for the Petitioner. S. Saikia and D. Baruah for the Respondent. JUDGMENT 1. Heard Dr. A.K. Saraf, learned counsel for the petitioner, and Mr. U. Bhuyan, standing counsel for the Income-tax Department. 2. For the assessment year 1994-95, assessment was made against the petitioner-company. As per the said assessment Rs. 8,95,70,016 was demanded from the petitioner-company. A sum of Rs. 40,49,749 was, however, adjusted against the said demand out of the refund due to the petitioner for the assessment year 1996-97. The petitioner preferred an appeal before the Commissioner of Income-tax (Appeals), Guwahati. The said appeal has been rejected but the order passed by the appellate authority was communicated to the petitioner only on February 12, 2002. Consequent upon rejection of the appeal, the demand of Rs. 8,55,20,267 has been raised against the petitioner by the Assistant Commissioner of Income-tax, Dhubri Circle, by his notice dated February 8, 2002. 3. For the assessment year 1996-97, the petitioner was assessed to a demand of Rs. 2,16,69,927. The said demand, however, has been adjusted by the Department due to the petitioner. The petitioner filed an appeal before the Commissioner of Income-tax (Appeals), Guwahati, against the…

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