The Delhi High Court has reserved its decision regarding a plea brought forth by Congress seeking a halt to Income Tax recovery proceedings, which aim to collect over Rs 105 crore in outstanding taxes. This plea challenges the dismissal of a previous appeal by the Income Tax Appellate Tribunal (ITAT) regarding penalties imposed for discrepancies found in certain tax returns.
The ITAT had previously rejected Congress’s request to stay Income Tax Department actions, including recovery measures and freezing of their bank accounts. After extensive hearings, the Division Bench of Justice Yashwant Verma and Justice Purushaindra Kumar Kaurav chose to defer their ruling.
During the proceedings, the bench questioned the Congress’s representatives about apparent inactivity in their office since 2021. They highlighted a perceived disregard for established procedures and criticized the handling of the matter by the petitioner.
Furthermore, the bench found no fundamental issues with the ITAT’s previous order. It dismissed the Congress’s argument that a 20 percent deposit in 2021 should have warranted a stay on proceedings, emphasizing the need to evaluate each case individually.
The bench also noted the lack of recovery actions initiated by the Assessing Officer following the rejection of the appeal by the CIT (Appeals) in March 2023. It criticized the Congress’s lack of preparedness during multiple hearing occasions before the Tribunal.
Despite Senior Advocate Vivek Tankha’s request for a 10-day postponement to approach the High Court, the bench declined, stating it lacked the authority to grant such a delay.
Representatives from the Income Tax Department defended their actions, emphasizing the Congress’s failure to comply with payment requests dating back to July 6, 2021. They asserted that their actions were lawful and necessary to recover outstanding dues.
Notably, the Income Tax Department had already retrieved Rs 65 crore from the Congress’s accounts out of the total outstanding tax dues of Rs 115 crore. In response, Congress has complained to the ITAT, seeking a stay on further actions until the resolution of their appeal.