M/S.Match Point Tennis Academy India Private Limited v. Assistant Commissioner F Income Tax

Order by Income Tax Amount Payable to Claimant after Deducting Payment to Income Tax Department Demand Draft to be issued to Income Tax Department as per the Garnishee order as per Garnishee Order Savithri Naidu 18,82,65,30 14,70,29,795 4,12,35,511 14,70,29,795 Raji Naidu 7,27,95,918 5,82,68,034 1,45,27,884 5,82,68,034 Vikram Naidu 10,71,02,04 11,65,51,246 10,71,02,041 Match Point Tennis Academy 4,18,36,735 4,18,36,735 Total 41,00,00,00 32,18,49,075 9,76,00,130 31,23,99,870 The same may be taken on record"

¶32It is in this background, the Liquidator issued an Email communication dated 20.11.2025 to the Petitioner company viz., M/s Match Point Tennis Academy and the individual petitioners regarding disbursement under Section 53 of the Insolvency and Bankruptcy Code, 2016, wherein it is stated that apart from the amount has been paid to the Respondent as per the Garnishee Order, the remaining amount payable to the Petitioner company viz., M/s Match Point Tennis Academy and the individual petitioners will be disbursed accordingly.

¶33The aforesaid Email communication dated 20.11.2025 issued by the liquidator to the Petitioner company viz., M/s Match Point Tennis Academy and the individual petitioners is extracted hereunder:- "We are in the process of distributing the sale proceeds and we will be paying your full admitted claim to your bank account provided in the claim form. I have already communicated vide letter dated 15.11.2025 through speed post in respect of garnishee notice issued to me by the Income Tax Department and amount payable by you will be paid to the department and your realisation of 4 Crore as per the Supreme Court Order. After paying an amount of Rs.31239987 to income tax as per garnishee order, The following are the payment will be effected today and if there is any error in the account number pls revert before 4pm. IFSC CODE ACCOUNT NO NAME AMOUNT SBIN000423 10163056714 Mrs. Savithri R Naidu 41235511/- HDFC00000 0010100004307 Mr. N. Rajiv Naidu 14527884/- HDFC00000 0010200001076 M/s. Match Point Tennis Academy 41836735/- Upon payment of the above said claim amount, all dues payable by the company in Liquidation is settled in full and Company in Liquidation has no further liability towards you and all the cases filed against the company in liquidation shall be withdrawn forthwith except those matters pending before NCLT."

¶34Pursuant to the aforesaid Email communication dated

20.11.2025, the bank account of the Petitioner company viz., M/s Match Point Tennis Academy with the 2nd Respondent Bank was blocked in the light of the garnishee order from the Income Tax Department which was communicated to the petitioner in W.P. No.47754 of 2025 namely, Rajiv Naidu (Managing Director of the Petitioner company in W.P. No.47005 of 2025) vide communication dated 26.11.2025.

¶35On consideration of the overall facts and circumstances of the case, it is evident that the individual petitioners and the petitioner Company have received a sum of Rs.9,76,00,130/- from and out of Rs.41 crores, after adjusting and factoring Rs.4,00,00,000/-, which has been deposited before the Fast Track Court-III, Saidapet in C.C.No.121 of 2018, pursuant to the order of the Hon'ble Supreme Court in SLP (Crl) No.9773/2025 dated 01.09.2025, thus filed by one Mrs.Bhuvaneswari Udayakumar, the Director of the Company under liquidation.

¶36Since the individual petitioners and the petitioner company viz., M/s Match Point Tennis Academy had failed to obtain stay of recovery of the amount, a sum of Rs.31,14,67,542/- was transferred by the liquidator as against a sum of Rs.32,18,49,075/- claimed by the Income Tax Department towards the tax due confirmed against the respective petitioners.

¶37A sum of Rs.9,76,00,130/- has been paid to Mrs.Savithri R Naidu, the petitioner in W.P. No. 47735 of 2025, Mr. N. Rajiv Naidu, the petitioner in W.P. No. 47754 of 2025 and M/s. Match Point Tennis Academy, the petitioner in W.P. No. 47005 of 2025 leaving Rs.9,32,328/- in the hands of the liquidator.

¶38Paragraph No.34 of the Counter Affidavit filed by the 2nd respondent captures the same, which is reproduced hereunder:- "3. While rejecting the stay petition filed by the three individuals/assessee vide order dated 21.08.2025, the respondent/Assistant Commissioner of Income Tax, Central CIR 3(1), Chennai, has rejected the same in the light of para 4(B)(b) of CBDT dated 29.02.2016 bearing reference No.F.No.404/72/93-ITCC. The relevant clause reads as under:

¶4In order to streamline the process of grant of stay and standardize the quantum of lump sum payment required to be made by the assessee as a pre-condition for stay of demand disputed before CIT (A), the following modified guidelines are being issued in partial modification of Instruction No.1914:

(A) In a case where the outstanding demand is disputed before CIT (A), the assessing officer shall grant stay of demand till disposal of first appeal on payment of 15% of the disputed demand, unless the case falls in the category discussed in para (B) hereunder.

(B) In a situation where,

(a) the assessing officer is of the view that the nature of addition resulting in the disputed demand is such that payment of a lump sum amount higher than 15% is warranted (e.g. in a case where addition on the same issue has been confirmed by appellate authorities in earlier years or the decision of the Supreme Court or jurisdictional High Court is in favour of Revenue or addition is based on credible evidence collected in a search or survey operation, etc.) or,

(b) the assessing officer is of the view that the nature of addition resulting in the disputed demand is such that payment of a lump sum amount lower than 15% is warranted (e.g. in a case where addition on the same issue has been deleted by appellate authorities in earlier years or the decision of the Supreme Court or jurisdictional High Court is in favour of the assessee, etc.), the assessing officer shall refer the matter to the administrative Pr.CIT/CIT, who after considering all relevant facts shall decide the quantum/proportion of demand to be paid by the assessee as lump sum payment for granting a stay of the balance demand.

(C) In a case where stay of demand is granted by the assessing officer on payment of 15% of the disputed demand and the assessee is still aggrieved, he may approach the jurisdictional administrative Pr. CIT/ CIT for a review of the decision of the assessing officer.

(D) The assessing officer shall dispose of a stay petition within 2 weeks of filing of the petition. If a reference has been made to Pr. CIT/ CIT under para 4 (B) above or a review petition has been filed by the assessee under para 4 (C) above, the same shall also be disposed of by the Pr. CIT/CIT within 2 weeks of the assessing officer making such reference or the assessee filing such review, as the case may be.

(E) In granting stay, the Assessing Officer may impose such conditions as he may think fit. He may, inter alia,-

(i) require an undertaking from the assessee that he will cooperate in the early disposal of appeal failing which the stay order will be cancelled:

(ii) reserve the right to review the order passed after expiry of reasonable period (say 6 months) or if the assessee has not cooperated in the early disposal of appeal, or where a subsequent pronouncement by a higher appellate authority or court alters the above situations,

(iii) reserve the right to adjust refunds arising, if any, against the demand, to the extent of the amount required for granting stay and subject to the provisions of section 245.

¶5These instructions/guidelines may be immediately brought to the notice of all officers working in your jurisdiction for proper compliance."

¶39In the light of the above CBDT Circular dated 29.02.2016 bearing Reference No.F.No.404/72/93-ITCC, all references to 15% of the disputed demand was later enhanced to 20% of the disputed tax by Office Memorandum bearing Ref.No.F.No.404/72/93-ITCC dated 31.07.2017.

¶40The learned Senior Counsel for the individual petitioners and also the learned Senior Counsel for the petitioner company in W.P.No.47005 of 2025 submits that either 20% of the disputed tax or 15% of the disputed tax as the case may be, shall be appropriated towards the pre-deposit for a condition to stay the recovery of the demand confirmed in the respective Assessment Orders passed against the individual petitioners and the petitioner company and the balance amount shall be refunded back to them.

¶41On the other hand, the learned Senior Standing Counsel for the Income Tax Department would submit that as per the Paragraph No. 4 (B)

(a) of the Office Memorandum (CBDT) dated 29.02.2016, where addition is based on credible evidence collected during search or survey operation, the Assessing Officer is merely required to refer the matter to the Administrative Pr.CIT/CIT and after considering all the relevant facts shall decide the quantum/proportion of demand to be paid by the assessee as lump sum payment for granting a stay of the demand.

¶42It is submitted by the learned Senior Standing Counsel for the Respondent that since there was no stay operating against the Income Tax Department, the Income Tax Department has directed the 2nd Respondent/Official Liquidator to transfer the amount and it is in the background, the amounts were transferred to the Respondent by the Liquidator.

¶43There is no dispute that a sum of Rs.45,00,00,000/- was admitted towards the claim of the respective petitioner pursuant to the direction of the National Company Law Tribunal, Chennai. Out of the aforesaid amount of Rs.45,00,00,000/-, a sum of Rs.41,00,00,000/- have been allocated as the amount payable factoring the Order dated 01.09.2025 of the Hon'ble Supreme Court in SLP (Crl) No.9773 of 2025.

¶44The individual petitioners and the petitioner company viz., M/s. Match Point Tennis Academy are on appeal before the Appellate Authority against the respective assessment orders. These appeals have to be disposed of in due course of time by the Appellate Authority.

¶45Pending such disposal of the appeal pending before the Appellate Authority, the Income Tax Department is entitled to recover the amount subject to any stay order under Section 220(6) of the Income Tax Act, 1961. The Hon'ble Supreme Court in Pr.CIT vs. LG Electronics India (P.) Ltd., [2018] 18 SCC 447 has held as under:- "The subjects circular which has extracted above also indicates that the issue can be decided by the Principal Commissioner of Income Tax Department or the Commissioner of Income Tax Department, wherever the demand has been confirmed pursuant to a search proceedings. The Principal Commissioner of Income Tax/Commissioner of Income Tax can either decide the amount to be transferred."

¶46While passing the impugned orders, rejecting the stay petitions filed by the individual petitioners, the Respondent's Commissioner has not referred the matter to the Principal Commissioner of Income Tax or CIT(A) as is contemplated in Paragraph No. 4 (B) (a) of the Office Memorandum

(CBDT) dated 29.02.2016, that ought to have been followed by the Respondent as the Respondent is bound by the Circular issued by Central Board of Direct Taxes (CBDT) in terms of decision of Hon'ble Supreme Court.

¶47That apart, when a particular thing has to be done in a particular manner, that must be done only in that way and all other methods of performance are necessarily forbidden, as held by the Hon'ble Supreme Court in A.R.Antulay Vs.R.S.Nayak & another, AIR 1988 SC 1531.

¶48Since the amount has already been transferred directly by the 2nd Respondent to the Income Tax Department, the cases are remitted back for suitable orders to be passed by the Principal Commissioner of Income Tax/CIT (A) in terms of Paragraph No. 4(B)(a) of the Office Memorandum (CBDT) dated 29.02.2016. While passing such an order, such officer shall also take note of the above decision of the Hon'ble Supreme Court in Pr.CIT vs. LG Electronics India (P.) Ltd., referred to supra as well.

¶49In view thereof, the individual petitioners and the petitioner company viz., M/s. Match Point Tennis Academy are permitted to operate the Bank accounts which have been attached. The Principal Commissioner of Income Tax Department shall pass appropriate orders in accordance with law, within a period of three weeks from the date of receipt of a copy of this order.

¶50These Writ Petitions are being disposed of with the above observation. No costs. Connected Miscellaneous Petitions are closed.

11.02.2026 jd To

¶1Office of the Assistant Commissioner of Income Tax, Central CIR 3(1), No.46, Old No.108, Mahatma Gandhi Road, Chennai 600 034.

¶2The Official Liquidator, M/s.Landmark Housing Projects Chennai Pvt. Ltd. (In Liquidation), No.397, Precision Plaza, 3rd Floor, Anna Salai, Teynampet, Chennai 600 018.

¶3The Branch Manager, HDFC Bank Ltd, T-31 7th Avenue, MG Road, Besant Nagar, Chennai – 600 090.

C.SARAVANAN, J. jd W.P.No.47005 of 2025

11.02.2026

IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 11.02.2026 CORAM THE HONOURABLE MR.JUSTICE C.SARAVANAN W.P.Nos.47005, 45910, 47735, 47743, 47754 of 2025 and W.M.P.Nos.52517, 52518, 52521, 52523, 51192, 51193, 51196, 51197, 51200, 53284, 53287, 53289, 53297, 53302, 53305, 53314, 53319, 53320 of 2025 W.P.No.45910 of 2025 1. Savithri Naidu 2. Rajiv Naidu 3. Vikram Naidu 4. M/s. Match Point Tennis Academy (India) Private Limited Rep by its Managing Director Mr. Rajiv Naidu Residing at 7, 1st Avenue, Sasthri Nagar, Adyar, Chennai – 600 020. … Petitioners Vs. 1. Office of the Assistant Commissioner of Income Tax, Central CIR 3(1), No.46, Old No.108, Mahatma Gandhi Road, Chennai 600 034. 2. The Official Liquidator, M/s.Landmark Housing Projects Chennai Pvt. Ltd. (In Liquidation), No.397, Precision Plaza, 3rd Floor, Anna Salai, Teynampet, Chennai 600 018. … Respondent W.P.No.47005 of 2025 M/s. Match Point Tennis Academy (India) Private Limited Rep by its Managing Director Mr. Rajiv Naidu Residing at 7, 1st Avenue, Sasthri Nagar, Adyar, Chennai – 600 020. ... Petitioner Vs. 1. The Assistant Commissioner of Income Tax, Office of the Assistant Commissioner of Income Tax, Central CIR 3(1), No.46, Old No.108, Mahatma Gandhi Road, Chennai – 600 034. 2. The Branch Manager, HDFC Bank Ltd, T-31 7th Avenue, MG Road, Besant Nagar, Chennai – 600 090. ... Respondents W.P.No.47735 of 2025 Savithri Naidu … Petitioner Vs. Assistant Commissioner of Income Tax, Office of the Assistant Commissioner of Income Tax, Central CIR 3(1), No.46, Old No.108, Mahatma Gandhi Road, Chennai – 600 034. … Respondents W.P.No.47743 of 2025 Vikram Naidu … Petitioner Vs. Assistant Commissioner of Income Tax, Office of the Assistant Commissioner of Income Tax, Central CIR 3(1), No.46, Old No.108, Mahatma Gandhi Road, Chennai – 600 034. … Respondent W.P.No.47754 of 2025 Rajiv Naidu … Petitioner Vs. Assistant Commissioner of Income Tax, Office of the Assistant Commissioner of Income Tax, Central CIR 3(1), No.46, Old No.108, Mahatma Gandhi Road, Chennai – 600 034. … Respondent Prayer in W.P.No.45910 of 2025: Writ Petition filed under Article 226 of the Constitution of India, for issuance of a Writ of Certiorarified Mandamus, calling for the records of the 1st Respondent with respect to the impugned notice dated 01.09.2025 issued by the 1st Respondent to the 2nd Respondent vide DIN and No:ITBA/COM/F/17/2025-26/1080234761(1) and QUASH the same as non-est, invalid and illegal in the eyes of law and consequently, DIRECT the 1st Respondent to refund the sum of 31,23,99,870/- (Rupees Thirty One Crores Twenty Three Lakhs Ninety Nine Thousand Eight Hundred and Seventy only) which was disbursed by the 2nd Respondent to the 1st Respondent in pursuance to the impugned notice dated 01.09.2025 issued by the 1st Respondent to the 2nd Respondent. Prayer in W.P.No.47005 of 2025: Writ Petition filed under Article 226 of the Constitution of India, for issuance of a Writ of Certiorarified Mandamus, calling for the records of the 1st Respondent with respect to the impugned Notice dated 10.02.2022 issued by the 1st Respondent to the 2nd Respondent vide DIN & Notice No: ITBA/COM/F/17/2021-22/1039595154(1) and quash the same as non-est, invalid and illegal in the eyes of law and consequently, direct the 1st Respondent to direct the 2nd Respondent to defreeze the bank account of the Petitioner with the 2nd Respondent Bank bearing Account No.00102000010761. Prayer in W.P.No.47735 of 2025: Writ Petition filed under Article 226 of the Constitution of India, for issuance of a Writ of Certiorari, calling for the records of the Respondent with respect to the impugned order dated 21.08.2025 bearing DIN Letter No: ITBA/COM/F/17/2025- 26/1079847710(1) passed by the Respondent and QUASH the same as being invalid and non-est in the eyes of law. Prayer in W.P.No.47743 of 2025: Writ Petition filed under Article 226 of the Constitution of India, for issuance of a Writ of Certiorari, calling for the records of t