Acceptance of letters without acknowledgment is unacceptable: HC

Brief of the case :

The Hon’ble Bombay High court in the case of Piramal Fund Management Pvt. Ltd. vs. DCIT held that income tax officer to whom an application is made should give an acknowledgment of having received and accepted the application on face if the same is found in prescribed manner with prescribed details. Not giving acknowledgment even after accepting the application is unacceptable conduct on the part of officer.

 Facts of the case:

• The Assessing Officer for the Assessment Year 2012-13 had by order dated 19th January, 2016 raised a demand of Rs.52.08 crores. Assessee (Petitioner) challenged the assessment before CIT(A) by filling an appeal on 24^th Feb, 2016. Thereafter, the petitioner filed its application for stay in terms of section 220(6) of the Income Tax Act, 1961. This was along with an application dated 17th February, 2016 for stay of penalty proceedings.
• The Assessing Officer accepted the stay application, however, he did not provide an acknowledgment of having accepted and received the stay application dated 17th February, 2016.
• This action on the part of the Assessing Officer led the petitioner to file this petition on 23rd February, 2016. Immediately thereafter, the Assessing Officer provided an acknowledgment to the stay application in terms of Section 220(6) of the Act dated 17th February, 2016 on 23rd February, 2016 to the petitioner.
• AO in his affidavit stated that the petitioner should have filed its application for stay at the ASK center located in Aayakar Bhavan, where the Income Tax Department has made arrangements for acceptance of tapal(correspondences) addressed to all the officers located at Aayakar Bhavan.
• Assessee complained such as an irresponsible conduct of AO.

 Held by Hon’ble High Court:

• The court observed that conduct on the part of the Assessing Officer to accept a stay application without giving acknowledgment of its receipt is unacceptable. It is least expected of an Officer that when a person files an application / letter, which is accepted by him, an acknowledgement should be forthwith given to the party filing the application or letter.
• In case he refuses to accept the letter he should state on the letter the reason why it is not being accepted with a line or two for the refusal to accept. In case he does accept it and give an acknowledgment in accordance with the law.
• The stay application is still pending decision. Normally, it is the AO who has to decide to accept or reject the application but looking at the manner in which the petitioner has been dealt with by the Assessing Officer in regard to its stay application dated 17^th Feb,2016 , in the interest of justice court held that the application for stay filed by the petitioner be heard by another Officer different from the Assessing Officer.
• The Officer to deal with the petitioner’s stay application dated 17^th Feb,2016 is to be nominated by the Revenue.