Law: Income Tax Ordinance, 2001

Section: 183,190

Income Tax Ordinance (XLIX of 2001)----Ss.183 & 190---Penalty for non-payment of tax---Appeal before Appellate Tribunal---Stay granted against recovery---Show-cause notice for imposition of penalty for non-payment of tax---Validity---Taxation Officer had power to impose penalty in those cases in which the default in making payment of any tax was deliberate or otherwise on the part of an assessee but not because of a stay order granted by a competent authority, as such default was caused by operation of law which was protected under the principle that such passing of the stay order was material for suspending the demand and even its date of communication did not make it effective from that date---Person in whose favour stay order operates could not be held to have failed to make payment and demand would not become final when matter was sub judice before Court which had stated its recovery and that even the demand of department to levy or pay additional tax during the period in which stay was in operation was without lawful authority and of no legal effect---Stay order in effect provisionally suspends or makes demand non existent---Further, stay was granted against the recovery of tax demand---Propriety demands that department should not opt for coercive measures till the decision of appeal---Appellate Tribunal directed that not only the cocercive measures for recovery of tax demands but also the proceedings like imposing penalty be also not initiated against the assessee till the time when stay order holds the field---Stay petition was granted for another 60 days or till the decision of main appeal whichever was earlier---Miscellaneous application was accepted by the Appellate Tribunal. THIS ORDER PASSED BY: In this case a stay was granted for 60(sixty) days vide order in M.A. (Stay) No.50(IB)/2009 dated 23-6-2009 till 15-8-2009. This miscellaneous application has been filed by the assessee-applicant for the titled year to grant further stay against the recovery of tax demand amounting to Rs.5,929,610 till the decision of main appeal which is still pending for adjudication before the Income Tax Appellate Tribunal. 2. The learned AR states that the Department…

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