Pavani Structurals Private Limited; Pavani Estates; Pavani Housing & Finance v. Commissioner of Income Tax (Central) & Anr.

1. FACTS OF THE CASE

The four Pavani group writs challenged demand and bank notices dated 28 January 2005. The Tribunal appeals had already been heard on 27 August 2004 and judgments were awaited. Earlier proceedings involved conditional instalments, restricted stay and disputed responsibility for adjournments.

Source: PDF pp.1–5

2. DISCUSSION BY THE COURT

The Court declined to resolve the adjournment dispute. It considered the completed Tribunal hearing and the Departmental Representative’s recorded assurance against coercive measures material. Disposal at admission did not mean that Revenue admitted the petitioners’ affidavit allegations.

Source: PDF pp.4–5

3. JUDICIAL DECISION

The authorities were directed to withdraw the section 226(3) notices to the identified banks and take no coercive steps until pronouncement of the Tribunal judgments. Thereafter recovery could proceed according to law and the appeal results.

Source: PDF pp.5–6

4. OUTCOME

All four writs were disposed of without costs. The protection ended with pronouncement, not with exhaustion of every possible later appeal. No underlying assessment or disputed affidavit fact was adjudicated.

Source: PDF pp.4–6

5. Expert Comments

AKHB editorial analysis, distinct from the Court’s findings.

The timing of the appeal distinguished this recovery dispute

The Tribunal had already heard the appeals and reserved judgment. That circumstance, together with the recorded assurance, supported protection against collection in the intervening period. The order should not be recast as an automatic stay whenever an appeal is filed.

Source: PDF pp.4–5

Withdrawal of notices did not extinguish the demand

The Court removed the immediate bank-recovery mechanism and imposed a defined restraint. It expressly permitted later lawful recovery depending on the appeal result, preserving the distinction between temporary collection protection and substantive tax relief.

Source: PDF pp.5–6

Unresolved allegations remain unresolved

The Bench expressly protected Revenue from treating affidavit statements as admitted and declined to decide who caused adjournments. A case account should therefore rely on the undisputed reserved-judgment position, not assign procedural fault as an established finding.

Source: PDF pp.4–5