Page |1

IN THE HIGH COURT OF JUDICATURE AT ALLAHABAD

LIST OF RELEVANT DATE AND EVENTS

IN
CIVIL MISC. WRIT PETITION NO. ………………OF 2024
(Under Article 226 of Constitution of India)
District – Ghaziabad

Panchsheel Buildtech Private Limited

…Petitioner
Versus
Principal Commissioner of Income Tax, Ghaziabad & Ors.
…Respondents

S.No. Date Events

1. The Petitioner is a private limited company,
incorporated on 20.12.2006 and registered
with the Registrar of Companies, Delhi and
since then consistently engaged in the
business of developing residential and
commercial complexes and activities
incidental thereto, mainly in the National
Capital Region.
2. 16.10.2018 That the return of income for the
Assessment Year 2018-19 was furnished by
the Petitioner under section 139(1) of the
Income Tax Act, 1961 (“the Act”) declaring
therein total income at Rs. 11,19,34,820/-.
3. 22.09.2019 That the said return was processed under
section 143(1) of the Act. Subsequently, the
case of the Petitioner was selected for
scrutiny through CASS and a notice was
issued under section 143(2) of the Act under
E-Assessment Scheme, 2019.
4. September, Various notices were issued u/s 142(1) of
 Page |2

2019 to the Act which were duly complied by the

September Petitioner, barring few details insisted
2021 during the prevailing covid pandemic,
manifesting a total ignorance about the
accounting principles applicable to the case
and nature of business of the Petitioner,
despite the fact that furnishing of such
voluminous details was notpossible due to
technical limitation of the Portal of the
Department.
5. 28.09.2021 An assessment order u/s 143(3) r/w 144B
of the Act was passed by the Respondent
No. 4, wherein the total income of Petitioner
was assessed at Rs. 3,77,31,50,149/-, as
against the returned income of Rs.
11,19,34,820/-i.e., at more than 34 times
the returned income. The huge, arbitrary,
and unlawful additions made in the order
resulted in exorbitant demand of Rs
181,11,29,230/- determining a tax liability
of 44 times of the tax liability admitted by
the Petitioner in its return of income.
6. 27.10.2021 Aggrieved by the impugned assessment
order, the Petitioner filed an appeal u/s
246A of the Act within the time provided in
the Actbefore National Faceless Appeal
Centre.
7. 24.06.2022 The Petitioner filed a grievance petition
before the ‘Local Committee to deal with
Taxpayers’ Grievance from High Pitched
Scrutiny Assessment’constituted by
Respondent No. 5 to expeditiously deal with
Taxpayer’s grievance arising from High
Pitched Scrutiny Assessment.
8. 01.07.2022 The Petitioner filed an application for stay
on recovery of high-pitched demand of Rs
 Page |3

181,11,29,230/-before Respondent No. 1.

9. 26.09.2022 Respondent No. 1 issued directions to
Respondent No. 2 for not enforcing the
recovery of above-mentioned outstanding
demand till decision of Committee on High
Pitched Assessment. Accordingly, the
demand was stayed.
10. 15.02.2023 Respondent No. 2, without any change in
circumstances purportedly requested
Respondent No. 1 for vacation of stay of
demand.
11. 17.02.2023 Respondent No. 1,in a highly arbitrary
manner, abruptly vacated the order of stay
of demandwithout giving any opportunity of
being heard to the Petitioner and directedit
tomake payment of 20% of the total demand
i.e., Rs. 36,22,25,846/- by 23.02.2023.
12. 27.02.2023 Respondent No. 2 issued notice u/s 221(1)
of the Actresorting to coercive measures for
recovery by attaching all the bank accounts
of the Petitioner, including escrow accounts,
thereby, bringing business operations of the
Petitioner to halt.
13. 15.03.2023 Petitioner filed a petition before Respondent
No. 1 praying to review the order dated
17.02.2023 and keep in abeyance the
demand arising out of High-Pitched
assessment order of AY 2018-19, pending
decision of the Local Committee to deal with
Taxpayers’ Grievance from High Pitched
Scrutiny Assessment.
14. 15.03.2023 Petitioner filed a request before Respondent
No. 2 for withdrawal of unlawful attachment
of various Escrow Bank Accounts including
those maintained under the terms of
Government of India funded stressed fund
 Page |4

“SWAMIH”
15. 21.03.2023 Respondent No. 1 rejected the stay petition
and directed the Petitioner to pay at least
15% of the outstanding demand
immediately.
16. 21.03.2023 Petitioner being not in position to deposit
such a huge sum, requested Respondent
No. 1 to grant reasonable time and
opportunity allowing it to take suitable
recourse against order rejecting stay of
demand.
17. 23.03.2023 The Petitioner again requestedRespondent
No. 1 to considerits directions in the light of
gross and glaring inconsistences in the
assessment order. It was brought to the
notice of Respondent No. 1 that additions of
Rs.366.10 crores were made instead of
making additions of Rs.21.80 crores, had
the Respondent No.4 followed its own
analogy adopted in the assessment order,
because of ex-facie glaring errors such as (i)
deviation from the principle adopted in the
assessment order in allowance of
construction cost, (ii) estimation of revenue
from abandoned projects, and (iii) addition
of expenses not claimed in the P&L Account.
Request was made to ignore the effect of
glaring prima facie mistakes and accordingly
stay should be granted on deposit of 15%
demand that would have been raised had
the principles adopted in the assessment
order were correctly followed by Respondent
No. 4. Thereafter, tax of Rs. 2,75,68,000/-
was deposited by the Petitioner, bringing the
total recovery of taxes to Rs. 2,82,07,644/-,
therebymeeting the requirements of CBDT’s
 Page |5

Instruction No. 1914 dated 21.03.1996 and

the Office Memorandum [F.NO.404/72/93-
ITCC], dated 31-7-2017 as applied to the
enforceable demand.
18. Pursuant to abovementioned request, all the
bank accounts, attached in the meantime,
were released by the Respondent No. 2, with
the tacit approval of the higher authorities,
however, no formal stay order was passed
by Respondent No. 1.
19. 27.03.2023 Petitioner filed an application before
National Faceless Assessment Centre,
seeking withdrawal of the appeal with liberty
to file revision application u/s 264 of the Act
as Section 251(1)(a) of the Act does not
grant power to ‘set aside’ the assessment
order, which became impending in view of
the glaring infirmities.
20. 28.03.2023 The National Faceless Assessment Centre
dismissed the appeal as withdrawn.
21. 11.04.2023 The Petitioner filed a revision petition u/s
264 of the Act before Respondent No. 1 and
3, raising the legal and factual grounds
impeaching the maintainability of the
impugned assessment order. One of the
prayers in the revision petition was to stay,
pending disposal of the instant application
for revision, the proceedings for recovery of
the disputed demand created by the
impugned order.
22. 12.04.2023 There remained a stoic silence for almost a
to year, giving rise to legitimate expectation on
03.01.2024 the part of the Petitioner that the issue of
rest of the outstanding demand would be
raised only after arriving at a decision on
the pending revision application. However,
 Page |6

no notice was issued in respect of pending

264 Petition by the Respondent No.1, for the
reasons unknown to the Petitioner.
23. 04.01.2024 To its utter shock and surprise, a fresh
notice u/s 221(1) was issued by Respondent
No. 2 on 04.01.2024 asking the Petitioner to
deposit entire outstanding demand of
Rs.178.32 crores along with interest u/s
220(2) of the Act.
24. 23.01.2024 A detailed reply was furnished by the
Petitioner, to the said notice, again bringing
the necessary facts and circumstances of
the case to the notice of Respondent No. 2,
inter-alia, stating:
a. That there is no change in surrounding
circumstances of the assessee company
since March, 2023 to till date, which
warranted fresh coercive action for
recovery in matter which has already
been put to rest post release of escrow
accounts and payment of more than 20%
of the demand calculated after ignoring
the glaring inconsistencies in the
assessment order.

b. The revision application of assessee

company filed under Section 264 of the
Act is still pending adjudication before
Respondent No. 1 and the Petitioner is
hopeful of getting the adequate relief.

The authorized representative of the

Petitioner also met the Respondent No. 2
and the matter was adjourned to
01.02.2024, for proper appreciation of facts
and future course of action.
 Page |7

01.02.2024 The authorized representative of the

& Petitioner duly visited the office of the
02.02.2024 Respondent No. 2 on 1st as well as 2nd
February, 2024, however, the Respondent
No. 2 was unavailable in the office on both
days. The fact of the Authorized
representative having visited the office of
Respondent No. 2, on both days, was duly
noted by the staff of the Respondent No. 2.
No further date was communicated from the
office of JAO.
25. 03.02.2024 The banker of the Petitioner ‘Kotak
Mahindra Bank’ informed the Petitioner that
its 22-bankaccounts including escrow
accounts have been attached by Respondent
No. 2 u/s 226(3) of the Act directing the
bank to pay to the Income Tax Department
the amount due from Bank or held by Bank
on account of the Petitioner Company,
thereby, bringing to halt the business
operations of the Petitioner.
26. 16.02.2024 The Respondent No 1, after a lapse of almost
a year, held the request of the Petitioner,
dated 23.03.2023, for grant of stay on
recovery of balance demand in view of
deposit/recovery of more than 15% of the
demand which could have been raised
according to own estimate of Respondent
No-4, to be a repetitive petition to defer
paying of outstanding demand and
threatened to resort to coercive measures in
the event of failure to deposit 15% of the
outstanding demand. However, the
pendency of revision Petition before the
Respondent No. 1, herself, has been
thoroughly ignored, in arbitrarily rejecting
 Page |8

the request of the Petitioner. The action on

the part of Respondent no.1 is only a cover
up for the arbitrary attachments of bank
accounts by Respondent No.2.
Through this communication, the Petitioner
also came to know that the Local Committee
on High Pitched Scrutiny Assessment, after
a lapse of 20 months, considered the case of
assessee as “Not High-Pitched Scrutiny
Assessment”, vide its letter F.No. Pr.
CCIT/KNP/JCIT(T&J)/HPSA/2023-24/7225
dated 05.02.2024. The committee neither
gave any opportunity of being heard to the
Petitioner nor provided intimation of its
decision, depriving the Petitioner from
taking further legal recourse in the matter.
27. The Petitioner is constrained to approach
this Hon'ble Court due to the arbitrary and
unlawful coercive measures of recovery of
tax demand already initiated by the
Respondents and threatening further for
resorting to such methods in the event of
failure to deposit 15% of the unlawfully
raised irrecoverable demand which turns
out to be Rs.27 crores approximately. The
fact remains that the coercive recovery
thrust upon the Petitioner constitutes
approximately 200% of the demand which
could have been raised, if the approach
adopted by Respondent No. 4 was correctly
followed.

On the contrary, Respondent No. 1 has

maintained a blatantly inactive approach in
adjudicating the revision petition u/s 264 of
the Act pending since April 11, 2023.
 Page |9

Further, ‘Local Committee to deal with

Taxpayers’ Grievance from High Pitched
Scrutiny Assessment’has failed in serving its
very purpose of dealing with the grievances
of tax payers by inordinately delaying its
decision and failing to even communicate
the same to the aggrieved parties. A glaring
example of which is the case of Petitioner,
where after a lapse of 20 months, its case is
stated to have been considered as “Not
High-Pitched Scrutiny Assessment”. A fact,
came to be known by the Petitioner through
letter dated 16.02.2024 of the Respondent
No.1.

Therefore, the Petitioner has no alternative

remedy left but to approach this Hon’ble
Court for issuance of appropriate writ, order
or directions for staying the coercive
recovery measures till adjudication of
Revision Petition along with withdrawal of
unlawful attachment of the bank accounts
of the Petitioner. In addition, the Petitioner
also prays for a time-bound adjudication of
the Revision Petition filed u/s 264 of the Act
pending before Respondent No.1. Hence,
this Writ Petition
Date:
(NIKHIL AGARWAL )&(S.K. MISHRA)
AOR No.A/N-205/2012, AOR No. A/S-2306/2013
Advocates
Counsel for the Petitioner
Chamber No.42
High Court, Allahabad.
IN THE HIGH COURT OF JUDICATURE AT ALLAHABAD
 P a g e | 10

CIVIL MISC. STAY APPLICATION NO. OF 2024

(Under Chapter XXII Rule 1 of the High Court Rule)

ON BEHALF OF

Panchsheel Buildtech Private Limited Petitioner/ Applicant

IN

CIVIL MISC. WRIT PETITION NO. ………………OF 2024

(Under Article 226 of Constitution of India)

Panchsheel Buildtech Private Limited,

G-124, Shop No. 5, Dilshad Colony,
Dilshad Garden, Delhi 110 092.
[PAN: AAECP3492N]
Through its Director, Rahul kumar Singhwal

...Petitioner.
Versus
1.Principal Commissioner of Income Tax,Ghaziabad
C.G.O. Complex - 1, First Floor,
Hapur Chungi, Ghaziabad, UP
Email: Ghaziabad.pcit@incometax.gov.in

2.Assistant Commissioner of Income Tax,

Circle-2(1)(1), Ghaziabad.
C.G.O. Complex – 1, Purani Hapur Chungi,
Ghaziabad, U.P. – 201002
Email: ghaziabad.dcit2.2.1@incometax.gov.in

3.Principal Chief Commissioner of Income Tax

UP West and Uttarakhand
16/69, Aaykar Bhawan
Civil Lines, Kanpur - 208001
 P a g e | 11

4.National Faceless Assessment Centre,

Through Principal Chief Commissioner of Income Tax (NaFAC)
Income Tax Department, Delhi
4th Floor, Mayur Bhawan, Connaught Lane
Barakhamba, New Delhi, Delhi – 110001

5. Branch Manager,
Kotak Mahindra Bank,
Connaught Place,
New Delhi-110001. …Respondents

MOST RESPECTFULLY SHOWETH:

1. That the petitioner is filing the accompanying writ petition under

article 226 of the Constitution of India inter-alia challenging the
recovery proceedings initiated under the provisions of Income Tax
Act ‘1961 , during pendency of the revision application filed by the
petitioner under Section 264 of the Income Tax Act, in the said
application a specific prayer for interim relief for stay of demand
during pendency was prayed , upon which appropriate orders have
not been passed till date , nor the revision petition has yet been
decided.
2. That for the full factsand circumstances have been stated in the
accompanying writ petition, which may kindly be read in support of
the present application.
3. That in these circumstances and in the facts and circumstances
mentioned in the accompanying writ petition, it is expedient and
necessary in the interest of justice that this Hon’ble Court may most
graciously be pleased to stay :

a) the effect and operation of the recovery proceedings initiated vide

notice u/s 221(1) of the Act date 4.01.2024 (enclosed as
Annexure no-16 to the writ petition), during the pendency of
the accompanying writ petition;
 P a g e | 12

b) the effect and operation of the notice u/s 226(3) dated

02.02.2024, issued to the Branch Manager, Kotak Mahindra
Bank, Connaught place, New Delhi-110001, respondent no.5, for
attaching the bank account of the petitioner, issued by
Respondent No.3, (enclosed as Annexure No.1to the writ
petition),during the pendency of the accompanying writ petition ;

c) Pass such other order which this Hon’ble Court may deem fit and
proper under the circumstances of the case, otherwise the
applicant petitioner shall suffer irreparable loss and injury

PRAYER
It is most respectfully prayed that this Hon’ble Court may graciously
be pleased to:
a) the effect and operation of the recovery proceedings initiated vide
notice u/s 221(1) of the Act date 4.01.2024 (enclosed as
Annexure no-16 to the writ petition), during the pendency of
the accompanying writ petition;

b) the effect and operation of the notice u/s 226(3) dated

02.02.2024, issued to the Branch Manager, Kotak Mahindra
Bank, Connaught place, New Delhi-110001, respondent no.5, for
attaching the bank account of the petitioner, issued by
Respondent No.3, (enclosed as Annexure No.1 to the writ
petition), during pendency of the accompanying writ petition;

c) Pass such other order which this Hon’ble Court may deem fit and
proper under the circumstances of the case, otherwise the
applicant petitioner shall suffer irreparable loss and injury.

Date:
(NIKHIL AGARWAL )&(S.K. MISHRA)
AOR No.A/N-205/2012, AOR No. A/S-2306/2013
Advocates
Counsel for the Petitioner
Chamber No.42
High Court, Allahabad.
 P a g e | 13

IN THE HIGH COURT OF JUDICATURE AT ALLAHABAD

Civil Misc. Writ Petition No. ........ of 2024

(Under Article 226 of the Constitution of India)

[District: Ghaziabad]

Panchsheel Buildtech Private Limited,

G-124, Shop No. 5, Dilshad Colony,
Dilshad Garden, Delhi 110 092.
[PAN: AAECP3492N]
Through its Director, Rahul kumar Singhwal

...Petitioner.
Versus
1. Principal Commissioner of Income Tax,Ghaziabad
C.G.O. Complex - 1, First Floor,
Hapur Chungi, Ghaziabad, UP
Email: Ghaziabad.pcit@incometax.gov.in
2. Assistant Commissioner of Income Tax,
Circle-2(1)(1), Ghaziabad.
C.G.O. Complex – 1, Purani Hapur Chungi,
Ghaziabad, U.P. – 201002
Email: ghaziabad.dcit2.2.1@incometax.gov.in
3. Principal Chief Commissioner of Income Tax
UP West and Uttarakhand
16/69, Aaykar Bhawan
Civil Lines, Kanpur - 208001

4. National Faceless Assessment Centre,

Through Principal Chief Commissioner of Income Tax (NaFAC)
Income Tax Department, Delhi
4th Floor, Mayur Bhawan, Connaught Lane
Barakhamba, New Delhi, Delhi – 110001
 P a g e | 14

5. Branch Manager,
Kotak Mahindra Bank,
Connaught Place,
New Delhi-110001. …Respondents

To,
The Hon’ble the chief Justice and his other companion
Judges of the aforesaid Court.
The humble petition on behalf of the above named
petitioner Most Respectfully showeth as under:-
1. That this is the first Writ Petition on behalf of the Petitioner herein
which is filed before this Hon’ble Court for the relief claimed
hereinafter and no other writ petition is either filed or pending before
this Hon’ble Court or its Lucknow Bench for the relief claimed or
sought for.

2. That the Petitioner herein is not in receipt of any notice of caveat from
any of the respondents till date.

3. The Petitioner, in the absence of any other alternate remedy,is

constrained to approach this Hon'ble Court due to the fact:
3.1 That unwarranted coercive measures initiated by the
Respondents by arbitrarily attaching bank accounts through
notice dated 02.02.2024issued u/s 226(3) of the Act, to the
Branch Manager, Kotak Mahindra Bank, Connaught place, New
Delhi-110001, and bringing to halt the business operations of
the Petitioner for recovery of an unreasonable tax demand
raised through a high-pitched assessment order for the A.Y.
2018-19, despite the pendency of revision petition filed u/s 264
of the Act. A true copy of the notice u/s 226(3) dated
02.02.2024,to the Branch Manager, Kotak Mahindra Bank,
Connaught place, New Delhi-110001, for attaching the bank
account of the petitioner, issued by Respondent No. 3, is
annexed herewith as Annexure No. 1.
3.2 That Respondent No 1, after a lapse of almost a year, vide her
order dated 16.02.2024 held the request of the Petitioner, dated
 P a g e | 15

23.03.2023, for grant of stay on recovery of balance demand in

view of deposit/recovery of more than 15% of the demand which
could have been raised according to own estimate of
Respondent No-4, to be a repetitive petition and threatened to
resort to coercive measures in the event of failure to deposit
15% of the outstanding demand. The direction for depositing
Rs.27 crores approximately, issued unlawfully by the
Respondent No.1, burdens the Petitioner with a liability to
deposit approximately 200% of the demand which could have
been raised, if the approach adopted by Respondent No. 4 was
correctly followed. A true copy of the order so passed on
16.02.2024 by the Respondent No.1 is annexed herewith as
Annexure No. 2.
3.3 That through thecommunication dated 16.02.2024, the
Petitioner also came to know that the ‘Local Committee on High
Pitched Scrutiny Assessment’, after a lapse of 20 months,
purportedly considered the case of assessee as “Not High-
Pitched Scrutiny Assessment”. The committee, failing in serving
its very purpose, neither gave any opportunity of being heard to
the Petitioner nor provided intimation of its decision, depriving
the Petitioner from exercising its legal rights, resulting in gross
miscarriage of justice.

1. Territorial jurisdiction and description of Respondents

1.1. That the Respondent No. 2 is the Jurisdictional Assessing
Officer of the Petitioner functioning as Assistant Commissioner
of Income Tax, Circle 2(1)(1), Ghaziabad, under the charge of
Respondent No. 1 i.e., Principal Commissioner of Income Tax,
Ghaziabad, U.P. West,falling within the territorial jurisdiction of
this Hon’ble Court.
1.2. The Respondent No. 3 is the Principal Chief Commissioner of
Income Tax, for the Region UP West and Uttarakhand, and
holds overall administrative superintendence over Respondent
No. 1 and 2. He is also the key member of the Local Committee
on High Pitched Assessment.
 P a g e | 16

1.3. The Respondent No. 4 is heading the National Faceless

Assessment Centre, Delhi under whose administrative control
the assessment unit of NaFAC has passed the arbitrary high-
pitched assessment order.

2. That the Petitioner is a private limited company, incorporated on

20.12.2006 under The Companies Act 1956, registered with the
Registrar of Companies, Delhi, and is consistently engaged in the
business of developing residential and commercial complexes and
activities incidental thereto, mainly in the National Capital Region.

3. That On 16.10.2018, the Petitioner filed its return of income for the
Assessment Year 2018-19 under section 139(1) of the Income Tax
Act, 1961, declaring therein a total income of Rs. 11,19,34,820/-. A
true copy of the ITR -V of the Petitioner for AY 2018-19 dated
16.10.2018 is annexed herewith as Annexure No. 3.

4. That the said return was processed under section 143(1) of the Act,
and the case of the Petitioner was selected for scrutiny through CASS,
leading to the issuance of a notice under section 143(2) of the
Actunder E-Assessment Scheme, 2019. A true copy of the notice u/s
143(2) of the Act dated 22.09.2019 is annexed herewith as Annexure
No. 4.

5. That various notices were issued u/s 142(1) of the Act by the
Respondent No.4 which were duly complied by the Petitioner by
furnishing all the relevant details crucial to determination of the
income of the Petitioner according to the method of accounting
consistently followed by it and duly accepted by the Department for
last many years. However, few details were insisted by the
Respondent No.4 despite the fact that furnishing such voluminous
details was not possible due to the technical limitation of the Portal of
the Department. Such details were insisted upon by the Respondent
No. 4 during the prevailing covid pandemic, manifesting a total
ignorance about the accounting principles applicable to the case and
nature of business of the Petitioner.
 P a g e | 17

6. That ignoring the details filed by the Petitioner as well as the returns
and completed assessments of the preceding assessment years
available on record, the Respondent No.4 passed an arbitrary
assessment order on 28.09.2021, unlawfully invoking section 145(3)
of the Act, assessing the total income of the Petitioner at Rs.
377,31,50,149/- as against the returned income of Rs.
11,19,34,820/-. The huge, arbitrary and unlawful additions made in
the order resulted in an exorbitant demand of Rs. 181,11,29,230/-. A
true copy of the assessment order dated 28.09.2021 is annexed
herewith as Annexure No. 5.

7. That aggrieved by the impugned assessment order, the Petitioner filed

an appeal u/s 246A of the Act before National Faceless Appeal Centre
on 27.10.2021 within stipulated time as prescribed under law.

8. That aggrieved by the said High-Pitched assessment order, the

Petitioner also filed a grievance petition before the 'Local Committee to
deal with Taxpayers' Grievance from High Pitched Scrutiny
Assessment' constituted under the directions of Respondent No. 5 on
24.06.2022to expeditiously deal with Taxpayer’s grievance arising
from High Pitched Scrutiny Assessment. A true copy of the Grievance
Petition dated 24.06.2022 is annexed herewith as Annexure No. 6.It
is regretfully stated that the said petition remains pending
manifesting total apathy of the Respondents towards the measures
contemplated for the expeditious resolution of taxpayers’ grievances.

9. That thereafter the Petitioner also filed an application for stay on the
recovery of the high-pitched demand before Respondent No. 1 on
01.07.2022, and theRespondent No. 1appreciating the
unenforceability of the demand so raised, issued directionsvide order
dated 26.09.2022 to Respondent No. 2 for not enforcing the recovery
of above-mentioned outstanding demand till decision of the Local
Committee on High Pitched Scrutiny Assessment.

10.That on 15.02.2023, Respondent No. 2, without any change in

circumstancespurportedly requested Respondent No. 1 for the
 P a g e | 18

vacation of stay on recovery of demand. The Respondent No. 1, in a

highly arbitrary manner, abruptly vacated the stay on recovery of
demandwithout providing any opportunity of hearing to the Petitioner
and directed it, vide order dated 17.02.2023, to make payment of 20%
of the outstanding demand i.e. Rs.36,22,25,846/- by 23.02.2023. A
true copy of the order dated 17.02.2023 is annexed herewith as
Annexure No. 7.

11.That on 27.02.2023, Notice of demand u/s 221(1) of the Act was

issued by Respondent No. 2. Thereafter, the Respondent No.2
resorted to coercive measures for recovery by attaching all the bank
accounts of the Petitioner including escrow accounts held with
lenders, thereby, bringing business operations of the Petitioner to
halt. A true copy of the notice of demand dated 27.02.2023 is
annexed herewith as Annexure No. 8.

12.That on 15.03.2023,Petitioner filed a petition before Respondent No. 1

praying to review the order dated 17.02.2023 and keep in abeyance
the demand arising out of High-Pitched assessment order of AY 2018-
19, pending decision of the Local Committee to deal with Taxpayers’
Grievance from High Pitched Scrutiny Assessment. A true copy of the
petition dated 15.03.2023 filed by Petitioner is annexed herewith as
Annexure No. 9.

13.That on 15.03.2023, itself, the Petitioner also filed a request before

Respondent No. 2 for withdrawal of unlawful attachment of various
Escrow Bank Accounts including those maintained under the terms
of Government of India funded stressed fund “SWAMIH”. A true copy
of request dated 15.03.2023 is annexed herewith as Annexure No.
10.

14.That on 21.03.2023, Respondent No. 1 rejected the petition and

directed the Petitioner to pay at least 15% of the outstanding demand
immediately. A true copy of the order dated 21.03.2023 passed by
Respondent No. 2 is annexed herewith as Annexure No. 11.
 P a g e | 19

15.That not being in position to deposit such a huge sum, on the same
day, the Petitioner requested Respondent No. 1 to grant reasonable
time and opportunity allowing it to take suitable recourse against
order dated 21.03.2023. A true copy of the letter dated 21.03.2023
filed by Petitioner is annexed herewith as Annexure No. 12.

16.That the Petitioner again requested Respondent No. 1 to consider its

directions in the light of gross and glaring inconsistences in the
assessment order. It was brought to the notice of Respondent No. 1
that additions of Rs.366.10 crores were made instead of making
additions of Rs.21.80 because of ex-facie glaring errors such as (i)
deviation from the principle adopted in the assessment order in
allowance of construction cost, (ii) estimation of revenue from
abandoned projects, and (iii) addition of expenses not claimed in the
P&L Account. Request was made to ignore the effect of glaring prima
facie mistakes and accordingly stay should be granted on deposit of
15% demand that would have been raised had the principles adopted
in the assessment order were correctly followed by Respondent No. 4.
Thereafter, tax of Rs. 2,75,68,000/- was deposited by the Petitioner,
bringing the total recovery of taxes to Rs. 2,82,07,644/-, thereby
meeting the requirements of CBDT’s Instruction No. 1914 dated
21.03.1996 and the Office Memorandum [F.NO.404/72/93-ITCC],
dated 31-7-2017 as applied to the enforceable demand.A true copy of
the letter dated 23.03.2023 filed by Petitioner is annexed herewith as
Annexure No. 13.

17.That pursuant to abovementioned request, all the bank accounts,

attached in the meantime, were released by the Respondent No. 2,
with the tacit approval of the higher authorities, however, no formal
stay order was passedby Respondent No. 1. It is submitted that the
Petition has been using the said bank accounts freely since then.

18.That on 27.03.2023, Petitioner filed an application before National

Faceless Assessment Centre, seeking withdrawal of the appeal with
liberty to file revision application u/s 264 of the Act as Section 251(1)
(a) of the Act does not grant power to ‘set aside’ the assessment order,
which became impending in view of the glaring infirmities.The
 P a g e | 20

National Faceless Assessment Centreallowed the request of the

Petitioner and dismissed the appeal as withdrawn. A true copy of the
order dated 28.03.2023 is annexed herewith as Annexure No. 14.

19.That on 11.04.2023 the Petitioner filed a revision petitionu/s 264 of

the Act before Respondent No. 1 and 3, raising the legal and factual
grounds impeaching the maintainability of the assessment order,
which is pending adjudication till date. The revision petition explicitly
highlighted the ex-facie glaring mistakes, lack of understanding of the
applicable accounting principles and standards of recognition of
revenue on the part of the assessment unit, hypothetical basis of
estimation of revenue through a method unknown to law. A true
copy of the revision petition dated 11.04.2023 filed by the Petitioner is
annexed herewith as Annexure No. 15.It may kindly be noted that
one of the prayers in the revision petition was to stay the dcemand,
pending disposal of the instant application for revision, the
proceedings for recovery of the disputed demand created by the
impugned order. However, no formal order for stay of recovery of
balance demand was passed.

20.That a stoic silence for almost a year, allowed a legitimate expectation

on the part of the Petitioner that the issue of recovery of rest of the
outstanding demand would be raised only after arriving at a decision
on the pending revision application. It is pertinent to note that no
notice of any manner was issued by the Respondents to the
Petitioner, till 03.01.2024.

21. That to its utter shock and surprise, a fresh notice u/s 221(1) was
issued by Respondent No. 2 on 04.01.2024 asking the Petitioner to
deposit entire outstanding demand of Rs.178.32 crores along with
interest u/s 220(2) of the Act. A true copy of the notice u/s 221(1) of
the Act dated 04.01.2024 is annexed herewith as Annexure No. 16.

22.That on 23.01.2024, a detailed reply was furnished by the Petitioner,

to the said notice, again bringing the necessary facts and
circumstances of the case to the notice of Respondent No. 2, inter-
alia, stating:
 P a g e | 21

a. There is no change in surrounding circumstances of the

assessee company since March, 2023 to till date, which
warranted fresh coercive action for recovery in matter which has
already been put to rest post release of escrow accounts and
payment of more than 20% of the demand calculated after
ignoring the glaring inconsistencies in the assessment order.
b. The revision application of Assesse Company filed under Section
264 of the Act is still pending adjudication and the Petitioner is
hopeful of getting the adequate relief.

It was accordingly prayed that the recovery proceedings in the instant

case be kept in abeyance till the disposal of the revision application
pending adjudication before Respondent No.1

A true copy of the reply dated 23.01.2024 filed by the Petitioner is

annexed herewith as Annexure No. 17.

23.The authorized representative of the Petitioner also met the

Respondent No. 2 and the matter was adjourned to 01.02.2024, for
proper appreciation of facts and future course of action.

24.The authorized representative of the Petitioner duly visited the office

of the Respondent No. 2 on 1st as well as 2nd February, 2024, however,
the Respondent No. 2 was unavailable in the office on both days. The
fact of the Authorized representative having visited the office of
Respondent No. 2, on both days, was duly noted by the staff of the
Respondent No. 2. No further date was communicated from the office
of JAO.

25.The banker of the Petitioner ‘Kotak Mahindra Bank’ informed the

Petitioner that its 22-bank accounts including escrow accounts have
been attached by Respondent No. 2 u/s 226(3) of the Act directing the
bank to pay to the Income Tax Department the amount due from
Bank or held by Bank on account of the Petitioner Company, thereby,
 P a g e | 22

bringing to halt the business operations of the Petitioner.It is

surprising to note that no copy of such 226(3) notices were provided
to the Petitioner which is in violation of the provisions of section
226(3)(iii) of the Act.

26.That the AO without deciding the reply dated 23.01.2024, filed by the
petitioner, in response to the notice dated 4.01.2024 issued under
Section 221(1) and without considering the issue that the revision
application filed by the petitioner is still pending as well as the
interim prayer therein has not been decided, has proceeded with the
issuance of recovery/attachment proceedings by means of sending
direct attachment notices to the banks.

27.That the Respondent No 1, after a lapse of almost a year, vide

communication dated 16.02.2024, held the request of the Petitioner,
dated 23.03.2023, for grant of stay on recovery of balance demand in
view of deposit/recovery of more than 15% of the demand which
could have been raised according to own estimate of Respondent No-
4, to be a repetitive petition to defer paying of outstanding demand
and threatened to resort to coercive measures in the event of failure
to deposit 15% of the outstanding demand. The coercive recovery
thrust upon the Petitioner constitutes approximately 200% of the
overall demand which could have been raised, if the approach
adopted by Respondent No. 4 was correctly followed. However, the
pendency of revision Petition before the Respondent No. 1, herself,
has been blatantly ignored, in arbitrarily rejecting the request of the
Petitioner. In doing so, the Respondent No. 1 has also ignored the
specific prayer made in the revision petition, at point no (c), thereof,
to stay, pending disposal of the application for revision, the
proceedings for recovery of the disputed demand created by the
impugned order. The action on the part of Respondent no.1 is only a
cover up for the arbitrary attachments of bank accounts by
Respondent No.2.

28.That through the communication dated 16.02.2024, the Petitioner

also came to know that the Local Committee on High Pitched Scrutiny
Assessment, after a lapse of 20 months, considered the case of
 P a g e | 23

Petitioner as “Not High-Pitched Scrutiny Assessment”, vide its letter

F.No. Pr. CCIT/KNP/JCIT(T&J) /HPSA/2023-24/ 7225 dated
05.02.2024. The Committee neither gave any opportunity of being
heard to the Petitioner nor provided intimation of its decision,
depriving the Petitioner from taking further legal recourse in the
matter. It is respectfully submitted that the Committee has failed in
serving its very purpose of dealing with the grievances of tax payers
by not only inordinately delaying its decision but also failing to even
communicate the same to the aggrieved parties. The case of the
Petitioner is the classic example of the callous disregard for the rights
of the tax-payers, where after a lapse of 20 months its case is stated
to have been considered as “Not High -Pitched Scrutiny Assessment”
without even communicating the same to the Petitioner.

29.That since, the communication and basis of holding the assessment

order impugned in the grievance petition before the Committee as
“Not High-Pitched Scrutiny Assessment” has not been provided, the
Petitioner is unable to follow appropriate legal recourse and reserves
its right to appropriately challenge the same, as and when received.

30.That the glaring inconsistencies and arbitrariness in the impugned

assessment order passed by Respondent No. 4 which is the basis for
initiation of coercive recovery measures, establishing the balance of
convenience in favour of Petitioner, are as under:

30.1. The grievance pertains to the outstanding demand for the A.Y.
2018-19, return for which was filed in the regular course,
declaring an income of Rs.11.90 crores on a turnover of
Rs.228.36 crores recognized by regularly followed Percentage of
Completion Method (‘POCM’) method of accounting, prescribed
by the ICAI guidelines and affirmed by draft ICDS issued by
Respondent No. 5 itself.

30.2. However, Respondent No. 4 completed the assessment of the

Petitioner for A.Y. 2018-19 vide assessment order dated
28.09.2021, estimating revenue at 565.20 crores for further
estimating income of Rs.377.31 crores, at almost 34 times the
 P a g e | 24

returned income raising an unnerving demand of Rs. 181.11

cores which is 44 times of tax liability worked out in the
ITR

30.3. The assessment order has been passed purely on estimates,

adopting a method absolutely unknown to law:

i. by estimating the stage of completion of projects on the basis

of lapse of time, which was far away from the actual
construction carried out;

ii. by notionally assuming the proportionate cumulative cost of

construction till 31.03.2018 on the basis of estimated stage
of completion and

iii. by further assuming the notional revenue adding 15% mark

up as GP on the estimated cumulative cost of construction
on the basis of lapse of time.

The entire estimates were based on preliminary details of (i) date

of commencement, (ii)date of completion and (iii) estimates cost
of project; given as preliminary information for RERA
registration, at a time when RERA was introduced as a totally
new concept. Thus, the assessment was concluded in thorough
disregard of the applicable accounting principles, available
audited financial details for preceding, current and subsequent
assessment years as well as the completed assessments for five
immediately preceding assessment years.

30.4. Apart from above referred inherent defects, the assessment also
suffered from the following glaring mistakes:

i. Incorrect Trading Addition of Rs.336.80 crores based on

estimated Revenue and adding 15% mark up on estimated
Cumulative Cost; however,
 P a g e | 25

a. incorrectly allowing deduction of cost of construction on

the basis of Actual Cost as per the audited books of
account, instead of estimated Cumulative Cost;
b. making addition of estimated Revenue of Rs.63.25 crores
from abandoned projects.

ii. Addition of Rs.29.30 crores on account of borrowed cost

which was never claimed as revenue expenditure in the P&L
account by the Petitioner.

The glaring and catastrophic effect of the above inherent errors

has resulted in assessment of the Petitioner at effective G.P. rate
of 70% of the estimated Revenue in contrast to adoption of
estimated G.P. rate of 15% by the Respondent No.4 for arriving
at the Estimated Revenue in question. The humongous effect of
inconsistencies in the resultant tax demand, had the
Respondent No. 4 been consistent in its own stand, isshown as
under:

Income & demand - as per the own stand of NaFAC:

(in Rs. Lacs)
Revenue as per assessment order: 56,518.64
Less: estimated revenue from
6,325.79
abandoned project
Remaining revenue as per A.O. 50,192.85
GP considering markup 15% - Ld.
(50,192.85/115*15) 6,546.89
A.O.'s own estimate

Add: Other income (Note no. 9 of 357.

Financials) 47
6,904.3
Total Revenue
6
Less: Indirect Expenses (Note no. 3,604.
22+23+24+25 of Financials) 80
3,299.5
Net Profit as per AO’s method
6
1,119.
Less: Amount already taxed in ITR
35
Balance impugned amount to be 2,180.
taxed 21
 P a g e | 26

Proportionate demand (for convenience):

Demand on addition of Rs. 36,612.15 lacs made in the 18,111.
assessment order 29
Demand on addition of Rs. 2,180.21 lacs @ M.M.R.
1078.50
(18,111.29/36,612.15*2,180.21)

30.5. Accordingly, tax of Rs. 2,75,68,000/- was deposited by the

Petitioner, in addition to the demand recovered by Respondent
no.2 through bank attachment making the total recovery at Rs.
2,82,07,644/-i.e. more than 20% of the demand calculated as
above. Accordingly, a request to grant stay from recovery of the
balance demand was made, in view of CBDT’s Instruction No.
1914 dated 21.03.1996 and the Office Memorandum
[F.NO.404/72/93-ITCC],dated 31-7-2017.

31.That the arbitraryattachment of bank accounts by the Respondent

No. 3, including escrow accounts held alongwith the lenders by the
Petitioner, besides being highly unfair and arbitrary, is also in gross
violation of binding judicial precedents, holding unequivocally that
the funds lying in an escrow bank account cannot be appropriated by
the authorities as the balance does not belong to the assessee.
Reliance is placed on the following judicial precedents:
a. AAA Portfolios Pvt. Ltd. v. DCIT, W.P.(C) No.1272/2013
[Delhi High Court]
b. Shaw Wallace and Co. v. UOI, [2004] 267 ITR 248 [Calcutta
High Court]
c. Surinder Nath Kapoor v. Union of India: 1988 Supp SCC 626
32.That the CBDT, being the Apex Body of tax administration, has
shown its concern in the public domain, time and again, against the
tendency of making high-pitched assessments, by coming out with
various circulars and instructions from time to time. One of such
Instructions/ Circular F.No.225/101/2021-ITA-II, 3 Government of
India, Ministry of Finance, Department of Revenue, Central Board of
Direct Taxes dated 23.04.2022 issued under Section 119 of the
Income Tax Act, 1961. A copy of the CBDT instructions dated
23.04.2022 is annexed herewith as Annexure No. 18.
 P a g e | 27

33.That this Hon’ble Court in Harish Chandra Bhati v. PCIT Noida and
Others, Writ Tax No. 465 of 2022, vide order dated 19.05.2022 in
respect of aforesaid circular providing for constitution of local
committees observed that the personal affidavit of Revenue Secretary
referring taxpayer for an alternative administrative remedy for
grievance settlement prima facie appears to be wholly unsatisfactory
and a complete eyewash to address the problem being faced by
assesses on account of conflicting orders by NFAC, Delhi in as much
it merely provides a forum for complaint without any relief to
the complaint and without fixing any responsibility of the erring
officers. The Hon’ble Court observed that the CBDT itself
acknowledged the vide instructions/ circular dated 09.11.2015, the
tendency to frame high pitched and unreasonable assessment orders
and such grievances leads to harassment of taxpayers. However,
despite constitution of said local committees, the tendency to frame
high pitched and unreasonable assessment orders is persisting as
also acknowledged by CBDT vide circular dated 23.04.2022.
Thereafter, the Hon’ble Court issued certain directions in the nature
of mandamus which inter alia acknowledged the fact that Local
Committees have not yet been constituted and directed the
respondents to ensure that constitution and functionality of
local committees within 15 days and that grievance petition
shall be disposed of within two months and the result and action
be communicated to the assessee within next 4 weeks and also
issued directions for publicity about CBDT instructions and
communication addresses of such committees in newspapers and
website of Income tax Department. Even, under these
circumstances, the grievance of the Petitioner has not been lawfully
redressed till date, for which it cannot be blamed.

34.That as averred in the preceding paragraphs of the petition, the

assessment order is highly erroneous, unjustified and high-pitched,
raising a demand of 44 times the tax payable on income returned by
the Petitioner. The Petitioner has taken all necessary steps to get the
unjustified additions deleted. Presently, the projects of Petitioner are
dependent on borrowed interest-bearing funds. The coercive recovery
 P a g e | 28

action of the department will lead to stoppage of its business affecting

large number of stakeholders.

35.In present case as explained above, the coercive action for recovery of
demand will cause irreparable damage to the Petitioner. The
Petitioner company is highly indebted to the tune of approximately
435 crores and has even availed huge funding from the Special
Window for Affordable and Mid-Income Housing (SWAMIH)
Investment Fund which is a social impact fund specifically formed for
completing stressed and stalled residential projects which is a wholly-
owned subsidiary of the State Bank of India and substantially funded
by Government of India for the respite of the general public. Even the
escrow accounts maintained on the directions/ requirements of
stressed funds have been attached causing reasonable hardship in
running day to day business. The coercive recovery action may
destroy the Petitioner company for good because multiple proceedings
in different legal fora and enforcement authorities will get initiated
and resources will be wasted in handling them rather than
concentrate on construction and development of projects.

36.It is submitted that CBDT has from time to time issued various
instructions in relation to recovery of outstanding demand. In this
regard comprehensive guidelines were issued vide Instruction No
1914 dated 02.12.1993. That instruction was partially modified vide
OM dated 29.02.2016 and was further amended by OM dated
31.07.2017. It may be seen that clause 4(B)(b) of OM dated
29.02.2016 provides that the Assessing Officer is empowered to allow
stay of demand on payment of lump sum amount lower than 15%
(changed to 20% by OM dated 31.07.2017) after referring the
matter to the PCIT who may, after considering all relevant facts may
decide quantum of demand to be paid for granting stay of balance.

37.Furthermore, the aforesaid discretion vested in Respondent no. 2 is in

line with the ratio of CBDT Instruction No.95, date 21.08.1969 which
still holds the field in the facts and circumstances of the case of
Petitioner, as mentioned above, and the concern of CBDT in relation
to the High-Pitched assessments. Reliance is placed upon the case of
 P a g e | 29

N. Jegatheesan v. Deputy Commissioner of Income-tax, Non-

Corporate Circle-2, Madurai, [2015] 64 taxmann.com 339
(Madras), dated 18.11.2015, Madras HC

“17. It is clear that it is incorrect to state that CBDT Instruction

No.1914, dated 02.12.1993 supersedes all previous instructions.
Although instruction No.1914 specifically states that it is in
supersession of earlier instructions, the position obtaining after the
decision of the case in Volvoline Cummins Ltd. v. Dy. CIT [2008]
307 ITR 103/171 Taxman 241 (Delhi) is not altered at all. This is
so, the CBDT Instruction No.95, dated 21.08.1969 was issued
with the consent of the informal consultative committee held on
13th May, 1969 formed under the business rules of the
Parliament, which even now holds the field.

Hence, I am of the opinion that the tendency of making high

pitched assessments by the Assessing Officer is not unknown and
it may result in serious prejudice to the assessee and miscarriage
of justice & sometimes may even result into insolvency or closure
of the business if such power was to be exercised only in a pro-
revenue manner. Hence, I am of the opinion that the powers under
Sections 220(3) & 220(6) of the IT Act have to be exercised in
accordance with the letter and spirit of CBDT Instruction No.95,
dated 21.08.1969, which is binding on all the assessing
authorities created under the Act.
Therefore, the impugned order passed by the respondent without
considering CBDT Instruction No.95, dated 21.08.1969 is against
the principles laid down in the judgments stated supra. In the
absence of any specific bar to provide an opportunity in the
provision, the respondent ought to have provided an opportunity to
get absolute stay till the disposal of the appeal as well as in
consideration of the reasons to treat the assessee as 'not being in
default', in order to avoid interest and penalty. Whereas in this
case the Assessing Officer had failed to provide an opportunity of
being heard prior to disposal of the application under Section
220(3) for stay. Hence, I am of the opinion that the impugned
orders are liable to be set aside.”

38.That reliance is also placed upon the case of Valvoline Cummins

Ltd. v. Deputy Commissioner of Income-tax, Circle 17(1), [2008]
171 Taxman 241 (Delhi), dated 20.05.2008, wherein it was held as
under:
“40. It may be recalled that the returned income of the assessee
was Rs. 7.25 crores, but the assessed income is Rs. 58.68 crores,
which is almost 8 times the returned income. In this regard, learned
 P a g e | 30

counsel has drawn our attention to Instruction No. 96, dated 21-8-
1969 [See Taxman's Direct Taxes Circulars Vol. 2, XIth edition, p.
3356] issued by the CBDT, which deals with the framing of an
assessment which is substantially higher than the returned income.
The relevant portion of the Instruction reads as follows: —
"1384. Income determined on assessment was substantially higher
than returned income - Whether collection of tax in dispute is to be
held in abeyance till decision on appeal.—(1) One of the points that
came up for consideration in the 8th meeting of the Informal
Consultative Committee was that income-tax assessments were
arbitrarily pitched at high figures and that the collection of disputed
demands as a result thereof was also not stayed in spite of the
specific provision in the matter in section 220(6).
(2) The then Deputy Prime Minister had observed as under:
'. . . where the income determined on assessment was substantially
higher than the returned income, say, twice the latter amount or
more, the collection of the tax in dispute should be held in abeyance
till the decision on the appeals, provided there were no lapse on the
part of the assessee.'
(3) The Board desire that the above observations may be brought to
the notice of all the Income-tax Officers working under you and the
powers of stay of recovery in such cases up to the stage of first
appeal may be exercised by the Inspecting Assistant
Commissioner/Commissioner of Income-tax."
41. A perusal of paragraph 2 of the aforesaid extract would show
that where the income determined is substantially higher than the
returned income, that is, twice the latter amount or more, then the
collection of tax in dispute should be held in abeyance till the
decision on the appeal is taken. In this case, as we have noted
above, the assessment is almost 8 times the returned income.
Clearly, the above extract from Instruction No. 96, dated 21-8-1969
would be applicable to the facts of the case.
42. Learned counsel for the assessee has drawn our attention to
several decisions of various High Courts which have interpreted the
aforesaid Instruction in the way that we have read it. Some of these
decisions are N. Rajan Nair v. ITO [1987] 165 ITR 650 (Ker.), R.
Mani Goyal v. CIT [1996] 217 ITR 641 (All.) and I.V.R. Construction
Ltd. v. Asstt. CIT [1998] 231 ITR 519(AP).
43. Under the circumstances, we are of the view that the assessee
would, in normal course, be entitled to an absolute stay of the
demand on the basis of the above Instruction.”

39. Thatthe actions of the respondents are contrary to the binding

instructions issued by CBDT, relating to restraint of recovery during
 P a g e | 31

pendency of further proceedings in relation to high pitched demands,

in exercise of powers under Section 119 of the Act.

40. That in these circumstances and in the facts and circumstances

mentioned in the writ petition, it is expedient and necessary in the
interest of justice that this Hon’ble Court may most graciously be
pleased to stay :

a) the effect and operation of the recovery proceedings initiated vide

notice u/s 221(1) of the Act date 4.01.2024 (enclosed as
Annexure no-16 to the writ petition), during the pendency of
the present writ petition;

b) the effect and operation of the notice u/s 226(3) dated

02.02.2024, issued to the Branch Manager, Kotak Mahindra
Bank, Connaught place, New Delhi-110001, respondent no.5, for
attaching the bank account of the petitioner, issued by
Respondent No.3, (enclosed as Annexure No.1 to the writ
petition),during the pendency of the present writ petition;

c) Pass such other order which this Hon’ble Court may deem fit and
proper under the circumstances of the case, otherwise the
applicant petitioner shall suffer irreparable loss and injury

41. That under the circumstances the Petitioner has no other equally,
efficacious, alternative, speedy remedy other than to approach this
Hon’ble Court under Article 226 of Constitution of India.

42.That the present writ petition is being filed inter-alia on the following
grounds, which are independent and without prejudice to each
other:-

GROUNDS

A. Becausethe Respondents have initiated arbitrary and unlawful

coercive measures for the recovery of tax demand, including the
 P a g e | 32

attachment of bank accounts of the Petitioner, without proper

justification or adherence to legal principles.

B. Because the Respondent No. 2 was himself not available in the

office on the date fixed for hearing on the recovery notice u/s 221
i.e. 01.02.2024 and even day after and therefore the arbitrary
action of attachment of its bank accounts without communicating
any further time or date to the Petitioner amounts to gross violation
of justice.

C. Because the AO without deciding the reply dated 23.01.2024, filed

by the petitioner, in response to the notice dated 4.01.2024 issued
under Section 221(1) and without considering the issue that the
revision application filed by the petitioner is still pending as well as
the interim prayer therein has not been decided, has proceeded
with the issuance of recovery/attachment proceedings by means of
sending direct attachment notices to the banks.

D. Because the initiation of coercive recovery measures without

disposing of the interim prayer made in the revision petition filed by
the petitioner under section 264 of the Act, is highly arbitrary,
violative of principles of natural justice and amount to gross
miscarriage of justice.
E. Because, only the communication and not the basis of holding the
assessment order impugned in the grievance petition before the
Committee as “Not High-Pitched Scrutiny Assessment” has not
been provided, the Petitioner is unable to follow appropriate legal
recourse and reserves its right to appropriately challenge the same,
as and when received.

F. Because the order dated 16.02.2024 passed by the Respondent

No.1, without considering and deciding its specific prayer in the
revision petition and disposing of the lawful request of the
Petitioner summarily holding the same as repetitive petition is
highly arbitrary, without application of mind and fails to deal with
the contentions of the Petitioner.
 P a g e | 33

G. Because the directions contained in order dated 16.02.2024 to

deposit 15% of the unlawfully raised irrecoverable demand which
turns out to be 27 crores approximately is highly unjustified as it
fails to consider that it burdens the Petitioner with a liability to
deposit approximately 200% of the demand which could have been
raised, if the approach adopted by Respondent No.4 was correctly
followed.

H. Becausethe purported decision by ‘Local Committee on High

Pitched Scrutiny Assessments’ after a lapse of 17 months without
giving any opportunity of being heard to the Petitioner is against
the principles of natural justice and is bad in law. Further, the
failure of the committee to communicate its decision displays the
callous approach of the Respondents towards taxpayers’ grievances
and prevents the Petitioner to exercise its legal rights, leading to
further prejudice to the Petitioner and leaving it remediless.

I. Becausethe assessment order passed by Respondent No. 4 is

erroneous and unjustified, as it is based purely on estimates and
adopts a method unknown to law. The order fails to adhere to
applicable accounting principles and disregards audited financial
details, resulting in exorbitant and unjustifiable tax demands.

J. Because the attachment of bank accounts by Respondent No. 2 is

in violation of established judicial precedents, including cases such
as AAA Portfolios Pvt. Ltd. v. DCIT and Shaw Wallace and Co. v.
UOI, which emphasize the need for fairness and legality in tax
recovery measures.

K. Because failure to provide copies of attachment notices to the

Petitioner is in gross violation of the provisions of section 226(3)(iii)
of the Act manifests the arbitrary approach of the Respondents and
renders the attachment proceedings as bad in law.

L. Because the coercive recovery actions, if allowed to proceed, will

severely disrupt the Petitioner's business operations, including
 P a g e | 34

construction projects financed through borrowed funds. This

disruption will have cascading effects, including delays in project
completion, non-payment to suppliers and contractors, violation of
regulatory commitments, and adverse publicity, potentially leading
to insolvency or closure of the business.

M. Because the coercive recovery action, will cause irreparable

damage to the Petitioner without any corresponding tangible benefit
to the revenue. Given the Petitioner's substantial indebtedness and
reliance on funds from the SWAMIH Investment Fund, the
attachment of escrow accounts, wherein the funds do not belong to
the petitioner will further exacerbate financial hardships and
impede business operations.

N. Because the Petitioner's request for a stay on recovery is in line

with CBDT instructions and judicial pronouncements, including
CBDT Instruction No. 95 dated 21.08.1969 and relevant judicial
precedents such as Valvoline Cummins Ltd. v. Deputy
Commissioner of Income-tax, which mandate a cautious approach
in cases of high-pitched assessments.

O. Because the actions of the respondents are contrary to the binding

instructions issued by CBDT, relating to restraint of recovery
during pendency of further proceedings in relation to high pitched
demands, in exercise of powers under Section 119 of the Act.

That on the facts and grounds stated above, the petitioner prays for the
following reliefs:-

PRAYER

In view of the facts and circumstances stated hereinabove, it is most

respectfully prayed that this Hon'ble Court may be pleased to:

a. issue a suitable writ order or direction in the nature of

certiorari, quashing the recovery proceedings initiated vide
notice u/s 221(1) of the Act date 4.01.2024 (enclosed as
Annexure no-16 to the writ petition);
 P a g e | 35

b. issue a suitable writ order or direction in the nature of

prohibition, restraining or prohibiting the respondents, their
servants and agents in proceeding in any manner pursuant to
the recovery proceedings initiated vide notice u/s 221(1) of the
Act date 4.01.2024 (enclosed as Annexure no-16 to the writ
petition);

c. issue a suitable writ order or direction in the nature of

certiorari, quashing the notice u/s 226(3) dated 02.02.2024, to
the Branch Manager, Kotak Mahindra Bank, Connaught place,
New Delhi-110001, for attaching the bank account of the
petitioner, issued by Respondent No. 3, (enclosed as Annexure
No. 1to the writ petition);

d. issue a suitable writ order or direction in the nature of

prohibition, restraining or prohibiting the respondent no 6,
their servants and agents, from remitting any amount pursuant
to the notice issued u/s 226(3) dated 02.02.2024, to the issued
by Respondent No. 3, (enclosed as Annexure No. 1to the writ
petition);

e. issue a suitable writ order or direction in the nature of

mandamus commanding the respondent number 1 to at least
pass appropriate orders and decide the interim prayer for stay
of the demand as prayed for in the revision petition filed by the
petitioner under 264 of the Act;
f. issue a suitable writ order or direction in the nature of
mandamus commanding the respondent number 1 to decide
the revision petition filed by the petitioner under 264 of the Act,
expeditiously in accordance with law within a fixed time frame;
g. issue any other or suitable writ, order or direction as this
Hon'ble Court may deems fit and proper in the interest of
justice and equity.

Date:
 P a g e | 36

(NIKHIL AGARWAL )&(S.K. MISHRA)

AOR No.A/N-205/2012, AOR No. A/S-2306/2013
Advocates
Counsel for the Petitioner
Chamber No.42
High Court, Allahabad.
 P a g e | 37

IN THE HIGH COURT OF JUDICATURE AT ALLAHABAD

************
AFFIDAVIT
IN
CIVIL MISC. WRIT PETITION NO. OF 2024
(Under Article 226 of the Constitution of India)
DISTRICT : GHAZIABAD

Panchsheel Buildtech Private Limited,

G-124, Shop No. 5, Dilshad Colony,
Dilshad Garden, Delhi 110 092.
[PAN: AAECP3492N]
Through its Director, Rahul kumar Singhwal

...Petitioner.
Versus
1. Principal Commissioner of Income Tax,Ghaziabad
C.G.O. Complex - 1, First Floor,
Hapur Chungi, Ghaziabad, UP
Email: Ghaziabad.pcit@incometax.gov.in

2. Assistant Commissioner of Income Tax,

Circle-2(1)(1), Ghaziabad.
C.G.O. Complex – 1, Purani Hapur Chungi,
Ghaziabad, U.P. – 201002
Email: ghaziabad.dcit2.2.1@incometax.gov.in

3. Principal Chief Commissioner of Income Tax

UP West and Uttarakhand
16/69, Aaykar Bhawan
Civil Lines, Kanpur - 208001

4. National Faceless Assessment Centre,

Through Principal Chief Commissioner of Income Tax (NaFAC)
Income Tax Department, Delhi
4th Floor, Mayur Bhawan, Connaught Lane
 P a g e | 38

Barakhamba, New Delhi, Delhi – 110001

5. Branch Manager,
Kotak Mahindra Bank,
Connaught Place,
New Delhi-110001. …Respondents

Affidavit of Mr. Rahul Kumar Singhwal aged 35

years, son Ashok Kumar, Resident of KD-3, Kavi

nagar, Ghaziabad, U.P.-201002

(Religion – Hindu, Occupation – business

Adhaar no. - 829324348762)
Deponent

I, the deponent, above named do hereby solemnly affirm

and state on oath as under :-

1. That the deponent is the director of the petitioner company

and is looking after the aforesaid case on its behalf, as such
she is fully acquainted with the facts of the case deposed
below.
I, the deponent, above named do hereby declare that the
contents of paragraph no.1 of the affidavit and the contents of
paragraph nos. of the
writ petition are true to my personal knowledge and the
contents of paragraph nos. of the writ
petition are based on perusal of papers and the contents of
paragraph nos. Nil of the writ petition are based on
information received and the contents of paragraph nos.
of the writ petition are based on legal advice, which
I believe to be true that no part of it is false, and nothing
material has been concealed in it.
 P a g e | 39

So help me God.

(Deponent)

I, Sanjay Kumar Mishra, Advocate, High Court,

Allahabad, do hereby declare that the person making this
affidavit and alleging himself to be the deponent is the same
and I know him by perusal of papers produced before me by
him.

(Advocate)

Adv. Roll No.A/S2306/2013

Solemnly affirmed before me on this ………….day

of…………. 2024, at about ………A.M./P.M. by the deponent
who has been identified by the aforesaid person.

I have satisfied myself by examining the deponent who

has understood its contents, which has been read over and
explained to the deponent by me.

(Oath Commissioner)
 P a g e | 40

IN THE HIGH COURT OF JUDICATURE AT ALLAHABAD

INDEX

IN

Civil Misc. Writ Petition No. ........ of 2024

(Under Article 226 of the Constitution of India)

[District: Ghaziabad]

Panchsheel Buildtech Private Limited

...Petitioner
Versus
Principal Commissioner of Income Tax, Ghaziabad & Ors.
...Respondents

S. Particular date Annexure Page

No.
1. List of dates and
events.
2. Civil Misc. Stay
Application
(Under Chapter XII
Rule 1 of the High
Court Rules Read
with Section 151 of
the Civil Procedure
Code)
3. CIVIL MISC. WRIT
PETITION (U/A 226
of the Constitution
of India)
4. A true copy of the 02.02.2024 1
notice u/s 226(3)
issued by Respondent
No. 3.
5. A true copy of the 16.02.2024 2
 P a g e | 41

order so passed by the

Respondent No.1.
6. A true copy of the ITR 16.10.2018 3
-V of the Petitioner for
AY 2018-19
7. A true copy of the 22.09.2019 4
notice u/s 143(2) of
the Act d
8. A true copy of the 28.09.2021 5
assessment order
9. A true copy of the 24.06.2022 6
Grievance Petition
10. A true copy of the 17.02.2023 7
order

11. A true copy of the 27.02.2023 8

notice of demand
12. A true copy of the 15.03.2023 9
petition filed by
Petitioner.
13. A true copy of request 15.03.2023 10
14. A true copy of the 21.03.2023 11
order passed by
Respondent No. 2.
15. A true copy of the 21.03.2023 12
letter filed by
Petitioner.
16. A true copy of the 23.03.2023 13
letter filed by
Petitioner.
17. A true copy of the 28.03.2023 14
order.
18. A true copy of the 11.04.2023 15
revision petition filed
by the Petitioner.
19. A true copy of the 04.01.2024 16
notice u/s 221(1) of
the Act .
20. A true copy of the 23.01.2024 17
reply filed by the
Petitioner.
21. A copy of the CBDT 23.04.2022 18
instructions.

22. Affidavit along with ID

Proof
23. Vakalatnama
 P a g e | 42

Date:
(NIKHIL AGARWAL )&(S.K. MISHRA)
AOR No.A/N-205/2012, AOR No. A/S-2306/2013
Advocates
Counsel for the Petitioner
Chamber No.42
High Court, Allahabad.