Case Law Details
CIT Vs Durr India Pvt. Ltd. (Madras High Court)
In the case of CIT Vs Durr India Pvt. Ltd., the Madras High Court reviewed an appeal by the Revenue contesting the Income Tax Appellate Tribunal’s (ITAT) order that had granted a stay beyond the statutory limit of 365 days under Section 254(2A) of the Income Tax Act. The Revenue argued that the ITAT’s extension of the stay to 718 days was inappropriate, especially as the delay was attributed to the assessee. However, the ITAT had previously determined that the assessee complied with conditions of prior stay orders and had made payments that reduced the outstanding demand. The Tribunal noted that the delay in resolving the appeal was not the fault of the assessee, primarily due to the need for a Special Bench. Ultimately, the Madras High Court found that the stay order had already expired and ruled that no further adjudication was necessary. The court disposed of the appeal while leaving open the substantial questions of law for future consideration, clarifying that it did not express an opinion on the case’s merits.
FULL TEXT OF THE JUDGMENT/ORDER OF MADRAS HIGH COURT
Heard both sides and perused the materials available on record.
2. This tax case appeal is filed by the Revenue challenging the order dated 29.04.2022 passed by the Income Tax Appellate Tribunal, Madras “D” Bench, Chennai in SP No.35/Chny/2022 in I.T(TP) A No.15/Chny/2020 relating to the assessment year 2015-16 formulating the following substantial questions of law:
“1. Whether on the facts and in the circumstances of the case, the Tribunal was right in law granting stay beyond a period of 365 days especially when the delay in disposal of appeal is attributable to the Assessee which is contrary to the Section 254(2A) of the Income Tax Act, 1961?
2. Is not the finding of the Tribunal bad by extending the stay periodically upto 718 days especially when the statue prohibits granting of stay beyond 365 days and without disposing of the appeal and by not protecting the interest of the revenue adequately?”
3. By the order impugned herein, the Tribunal allowed the stay application filed by the assessee, after having found thus:
“… We find that the assessee has complied with the conditions of earlier stay orders and paid the demand as directed by the Tribunal. It could also be noted that refunds for various years have also been adjusted which has further reduced the outstanding demand. It could also be noted that delay in disposal of appeal could not be attributed to any fault on the part of the assessee since the fate of the appeal hinges on constitution of Special Bench. Under these circumstances, considering the ratio of Hon’ble Delhi High Court in the case of Pepsi Foods Pvt. Ltd. v. ACIT (376 ITR 87), we extend the stay of demand for a further period of 180 days from the date of this order or till the disposal of the quantum appeal, whichever is earlier. The conditions as stipulated in earlier stay order shall remain intact.”
5. The stay application stands allowed in terms of our above order.”
4. We find that the order under challenge merely extends the stay of demand for a further period of 180 days from the date of receipt of the copy of the order or till the disposal of the quantum appeal whichever is earlier. The said order dated 29.04.2022 extending the stay has also expired, after a long ago. Hence, we are of the opinion that no further adjudication is required in this appeal.
5. In such view of the matter, this tax case appeal stands disposed of, keeping the substantial questions of law raised herein open to be adjudicated in an appropriate proceedings. It is made clear that we are not expressing any opinion on the merits of the case. No costs.
Author Bio
