JUDGMENT
Surjit Singh, J.
1. Heard.
2. Writ petitioner is a Company, incorporated under the Companies Act. It is an Income Tax Assessee. Due to some dispute between the Directors of the Company, negative income tax return was submitted for the accounting year 2001-02, which the Assessing Officer treated as positive income statement and ordered for the payment of certain amount of money, by way of income tax for the said year.
3. The writ petitioner filed a statutory appeal before the Commissioner of Income Tax (Appeals) – respondent No. 2, because according to it the order was bad, inasmuch as even if the return was treated as a positive one, the petitioner was entitled to exemption under Section 80- IB of the Income Tax Act, in view of the Government policy for granting exemption to industrial units for the development of industry in the State of Himachal Pradesh. At the same time, the petitioner moved an application to the Assessing Officer for deferment of the demand raised, in respect of income tax for the accounting year 2001-02. The Assessing Officer instead of acceding to the request of writ petitioner for deferment of demand, issued a notice on the very day of making of the said application, calling upon the petitioner to show cause why penalty be not imposed for non-payment of taxes.
4. Now the writ petitioner has approached this Court, seeking a direction to the respondents not to effect the recovery of the tax assessed by the Assessing Officer and also not to take any proceedings for imposition of penalty in view of the provisions of Section 80-IB of the Income Tax
5. Respondents No. 1 and 3 in their reply have stated that the writ petition is not maintainable and that even for seeking stay of recovery of the tax, the remedy available to the writ petitioner is to approach the Commissioner of Income Tax (Appeals). Writ petitioner’s plea is that the Commissioner of Income Tax (Appeals) does not have any power to stay the operation of the order of the Assessing Officer in respect of the demand for tax.
6. After having heard the learned Counsel for the parties and having been taken through a judgment of the Hon’ble Supreme Court in the matter of Jute Corporation of India Ltd. v. Commissioner of Income tax and Anr. , as also looking to the general principle that the appeal is a continuation of the original proceedings, we feel that the Commissioner of Income Tax (Appeals) should be having inherent jurisdiction to stay the order of the order of assessment passed by the Assessing Officer.
7. Since the writ petitioner has already filed an appeal before the Commissioner of Income Tax (Appeals), we have no hesitation in holding that the present writ petition is not maintainable. In this view of the matter we are supported by the judgments of the Hon’ble Supreme Court in Rajureshwar Associates v. State of Maharashtra and Ors. ; State of Punjab and Ors. v. Punjab Fibres Ltd. and Ors. and S.J.S. Business Enterprises (P) Ltd. v. State of Bihar and Ors. .
8. However, considering the fact that we had issued an interim stay order, on the request of the writ petitioner, vide order dated 10.6.2005, we dispose of this writ petition with a direction to the Commissioner of Income Tax (Appeals), that is respondent No. 2, to dispose of the statutory appeal filed before him by the writ petitioner, within two months from the receipt of the copy of this order and also to decide the application of the writ petitioner, which it has already filed for staying the operation of the order of Assessing Officer, during the pendency of that appeal, by a speaking order, within fifteen days. Till then (i.e. during the period of 15 days) no coercive steps will be taken for effecting the recovery of tax imposed and demanded by the Assessing Officer.
9. Copy of the order be delivered to the counsel representing respondents No. 1 and 3 today itself, who says that he will be delivering it to respondent No. 2 within next three days.
10. The stay granted by this Court, vide order dated 10.6.2005 merges in this order. Needless to say that in case the writ petitioner feels aggrieved by the order of Commissioner of Income Tax (Appeals) on the application for stay or the final order in the appeal, it may approach the appropriate forum/ Court, as permissible under the law.