ORDER
R. K. Gupta, J.M.
1. This is a stay application filed by assessee seeking stay of demand pending against assessee. At the time of hearing it was submitted by the learned authorised representative that the various reference applications are pending before the Hon’ble High Court. The assessee is a petty agriculturist and there is no other source of income. It was further stated that about 56.600 kgs. of gold was found with the assessee and which was lying in the Treasury with the Collector, Chittorgarh and the orders of the Rajasthan High Court are that same is not to be returned to assessee till further orders. It was further stated that the appeal of the State and of Shri Gunwant Lal, who claims to be the real owner and revision petition of the applicant are pending for disposal before the Hon’ble High Court. The value of the impugned gold is being assessed in the hands of Shri Gunwant Lal. It was further stated that the gold is already in possession of Collector of Chittorgarh and there is no any other source for payment of such a huge demand. It was further submitted by the learned authorised representative that the similar issue was involved in case of other person and the Indore Bench of the Tribunal has confirmed the addition in that case. The case is reported in 58 ITD 459 (sic). Therefore, it was argued that the same item is considered in two hands and the matter is sub judice before High Court. Therefore, for these reasons also the matter should be stayed till the disposal of the reference application pending before the Hon’ble High Court. It was also argued that the matter is not reached to its finality therefore, the matter is pending and the Tribunal is the only authority who is having power to grant the stay. On this point reliance is placed on CIT vs. vs. Banshi Dhar & Sons (1986) 157 ITR 665 (SC). It was further submitted that the assessed income is many a times than the returned income. Therefore, also the demand should be stayed. On this point reliance is placed on Maharana Shri Bhagwat Singhji of Mewar vs. ITAT (1997) 223 ITR 192 (Raj).
2. On the other hand, learned Departmental Representative objected the stay of demand. He further submitted that the assessee has not denied the ownership of the seized gold. Therefore, the order of the AO are correct and the demand should not be stayed.
3. After hearing rival submissions and considering the facts on record, we are of the view that this is a fit case for stay of demand as we noted that assessee has no other source of income except the agricultural income. The reference application is pending before High Court. The other appeals are also pending which are in regard to ownership of the confiscated gold on which basis the additions were made in the hands of assessee. In case of CIT vs. Bansidhar & Sons and CIT vs. Chathuram Bhadani, etc. reported in (supra) the Hon’ble Supreme Court has held that “In an appropriate case, if the assessee feels that a stay of recovery pending disposal of the reference is necessary or is in the interest of justice, then the assessee is entitled to apply before the appellate authority to grant a stay until disposal of the reference by the High Court or until such time as the appellate authority thought fit. But in case the appellate authority acted without jurisdiction or in excessive jurisdiction or in improper exercise of the jurisdiction, then the decision of such appellate authority can be corrected by the High Courts by issuing appropriate writs under Arts. 226 & 227 of the Constitution”. Before holding so, the Hon’ble Supreme Court has observed that “The High Court does not have inherent power or incidental power in the matter of a reference pending before it to grant stay of realisation of tax or to grant injunction. That must remain within the jurisdiction of the appellate authority and pendency of a reference does not detract from that jurisdiction of the appellate authority”. By following the observations and the decisions of the apex Court, we find that proper power for stay of demand rests with Tribunal only. We also find some weight in the contention of the learned authorised representative that assessed income is much more than the income earned by the assessee during the year. It was also argued that the assessed income is not only much more but many a times of the income earned by the assessee and the earned income is only of agricultural income. On this point the reliance was placed on a decision of Rajasthan High Court in case of Maharana Shri Bhagwat Singhji of Mewar vs. ITAT (supra). In this case the Hon’ble High Court has held that the “Circular issued by the CBDT are binding on the authorities exercising power under taxing statute and have sufficient force of law. In view of Instruction No. 96 [F. No. 1/6/69/(ITCC) dt. 21st August, 1969], of the Board, it is clear that where the income determined on assessment was substantially higher than the returned income, twice the latter amount or more, the collection of the tax in dispute should be held in abeyance till the decision of the appeals”. In the present case the reference applications are pending before the Hon’ble jurisdictional High Court and pendency of reference application does not detract from that jurisdiction of the Tribunal. Therefore, in our considered view the matter regarding stay of recovery of demand rests only with the Tribunal and by exercising the powers vested in Tribunal as per the decision of the apex Court, we are of the view that the recovery of the demand should be stayed till the disposal of the reference application before the High Court. However, the assessee is directed not to dispose of any movable/immovable assets till the disposal of the reference application. The assessee is further directed to furnish an undertaking to this effect before the AO, if not furnished before it. We order accordingly.
4. In the result, the stay application is allowed.