SC criticises ICICI Bank for not defreezing Newsclick's bank accounts despite stay on tax recovery steps

19/11/2024

NEW DELHI, Nov 18: The Supreme Court today disposed of a miscellaneous application whereby, it allowed news portal Newclick's plea seeking direction against the ICICI bank, Saket, New Delhi, to comply with the August 9 order of the Court.
In the instant miscellaneous application, the petitioners raised the issue that after the Court's August 9 order, the de-freezing of their bank accounts has not begun as the bank is relying on December 15, 2023, communication of the Deputy Commissioner of Income Tax (Central)-1.
By an order dated August 9, the Court disposed of a plea filed by NewsClick for a stay on the income tax demand and directed that pending disposal of the appeal filed before the Income Tax Appellate Tribunal (ITAT), there shall be a stay of further recovery of an outstanding amount. This order was passed taking into consideration that approximately 30 per cent of the demand has been recovered.
The division bench of Justices BV Nagarathna and Nongmeikapam Kotiswar Singh passed the order in an SLP filed by the Newsclick against the Delhi High Court's order rejecting a stay on the income tax demand. On July 8, the Court issued a notice in the SLP.
To provide a brief background, the news portal had claimed that the respondent-tax authorities, vide orders passed in February and November 2023, arbitrarily rejected its application for a stay of demand during the pendency of its appeal before the Commissioner of Income-Tax (Appeals) against Assessment Order dated December 30, 2022. These orders further directed it to pay 20% of the demand before applying afresh for a stay of demand during the pendency of its appeal before the Commissioner of Income Tax (Appeals).
Following this, the petitioner moved before the Income Tax Appellate Tribunal. The Tribunal had upheld the findings of the AO and refused to stay the income tax demand. Against this, a Writ petition was filed before the Delhi High Court. However, the same was dismissed as the Court did not find any reason to interfere with the Appellate Tribunal's order. Challenging this order, the instant Special Leave Petition was filed by NewsClick.
It may also be mentioned that earlier, the Delhi High Court had observed that Newsclick's plea of financial stringency based on its balance sheet inspired no confidence. The Court noted that, as per the assessing officer, the news portal's accounts were not properly maintained. Against this order also, an SLP was filed, however, the same was withdrawn with the liberty to move the the Income Tax Appellate Tribunal.
Today, when the bench was apprised that its order had not been complied with, Justice Nagarathna deprecated the bank for complying with the early communication despite the fact that the Order passed by the Supreme Court is subsequent to that.
She said: "So, on Union's letter? The bank does not act on Supreme Court's order but on Union's letter."
The Court was informed that the bank is not a party to the miscellaneous application. However, advocate Sameer Parekh (Standing Counsel for ICICI Bank) appeared and informed the Court that he was not aware of this matter. He added that if the petitioner informs them, he will take care of that.
The Court ordered: "We deprecate the omission on the part of the ICICI bank in not complying with order of this court dated August 9, 2024 and instead seeking to comply with communication dated 15 Dec, 2023, issued by Deputy Commissioner, Income Tax. It is needless to observe that this court's order dated August 9 is subsequent to the aforesaid communication. In circumstances, the direction is issued to the ICICI Bank, Saket, New Delhi, to comply with order dated August 9 both in letter and spirit."
Kamat added that the Court may clarify that December 15 has been stayed because if they try to recover from some other bank account, if any, the petitioner will again have to come before the Court.
On this, Justice Nagarathna orally remarked: "No recovery in respect of this. If they can't understand our simple English, we cannot help them."
Case Details: PPK NEWSCLICK STUDIO PVT. LTD. VS. DEPUTY COMMISSIONER OF INCOME TAX., DIARY NO. -Diary No. 48875-2024
Appearances: Devadatt Kamat (Senior Advocate) & Advocate Rohit Sharma (for Petitioners) & Advocate Chinmayee Chandra (for Union)

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