CORTEVA AGRISCIENCE INDIA PVT. LTD.,GURGAON V. DCIT, CIRCLE- 4(2), NEW DELHI

SA 81/DEL/2025

AI Insights

Corteva Agriscience India Private Limited filed a Stay Application (SA No.81/Del/2025) with the ITAT, seeking a stay on the recovery of an outstanding demand of Rs. 277.07 crores towards income-tax and interest for the Assessment Year 2018-19. The demand was based on various additions made by the Assessing Officer, which the assessee contested. The ITAT had previously granted stays on similar grounds, and the current application sought to extend this relief under similar terms. The Tribunal considered the procedural history, including adjustments and previous stays, and the legal arguments presented regarding the additions made to the assessee's income.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 473540 (ITAT-DELHI)
• Appeal Type: Stay Application
• Pronouncement Date: 21-02-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: I
• Assessment Year: 2018-2019
• Other Referred Cases: CIT v. Brandix Mauritius Holdings Limited, M/s Expeditors International of Washington Inc. v. ACIT, Circle International Tax 1(2)(2), Delhi
• Laws Referred To: Income Tax Act
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SAHIL KUMAR BANSAL
• Assessee Lawyers: HARPREET S. AJMANI
• Keywords: Capital Gains; Rectification of order; Application of stay
• Section: 143(3); 139(1)

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI BENCH: ‘I’ NEW DELHI BEFORE SHRI MAHAVIR SINGH, VICE-PRESIDENT AND SHRI RAMIT KOCHAR, ACCOUNTANT MEMBER S.A. No.81/Del/2025 [Arising out of ITA No.1939/Del/2022] Assessment Year: 2018-19 Corteva Agriscience India Private Limited 17th Floor, Tower-C DLF Cyber Greens Sector-25A, Phase-III Gurugram-122002 Haryana PAN:AAACE2462M v. Dy. CIT, Circle-4(2), Delhi (Appellant) (Respondent) ORDER PER RAMIT KOCHAR, AM: This Stay Application in SA No.81/Del/2025 for Assessment Year 2018-19 is filed by the assessee with ITAT, Delhi Benches, Delhi which has arisen from ITA No.1939/Del/2022 . By way of this Stay Application, the assessee is seeking for stay of recovery of outstanding demand towards income-tax and interest , aggregating to Rs. 277,07,08,404/- , raised by the Revenue vide notice of demand/computation sheet dated 28th July, 2022(DIN & Assessee by Shri Harpreet S. Ajmani,Advocate Department by Shri Sahil Kumar Bansal, Sr. DR Date of hearing 21.02.2025 Date of pronouncement 21.02.2025 S.A.No.81/Del/2025 Arising out of ITA no. 1939/Del/2022 2 | P a g e Document No. ITBA/AST/S/186/2022-23/ 1044275558(1) & ITBA/AST/S/156/2022-23/1044275557(1)). The assessment order was passed by learned Assessing Officer on 28th July , 2022 u/s 143(3) read with Section 144C(3)(DIN & Order No. ITBA/AST/ S/143(3)/2022-23/1044275387(1)). The said computation sheet, notice of demand and assessment order are placed in paper book filed along with stay application at page no. 94-127. 2. At the outset, Ld. Counsel for the assessee submitted that the Division Bench of ITAT, Delhi had earlier granted stay on recovery of outstanding demand towards income-tax and interest to the tune of Rs. 238.07 crores vide Order dated 09.09.2022 in SA No. 281/Del/2022 arising out of ITA No. 1939/Del/2022 , with directions to the learned Assessing Officer to adjust refund of Rs. 39 crores which was stated by learned counsel of the assessee to be due to the assessee towards part recovery of the aforesaid total outstanding demand of Rs. 277.07 crores, and subject to such adjustment as directed, remaining outstanding demand of income- tax and interest to the tune of Rs. 238.07 crores shall remain stayed for recovery by Revenue for a period of 180 days or till the disposal of the appeal, which ever is earlier. It is submitted that the said Rs. 39 crores have not yet been adjusted by the AO, and the demand of Rs. 277.07 crores still remains to be outstanding for recovery. It is averred by ld. Counsel for the assessee that thereafter there is rectification application moved by the assessee for rectification of mistake of Rs. 7,09,96,544/- towards erroneous addition of interest u/s 234A made by the Revenue , while the return of income was originally filed on 29.11.2018 which was filed within due date as prescribed u/s 139(1). It is averred by the S.A.No.81/Del/2025 Arising out of ITA no. 1939/Del/2022 3 | P a g e assessee that addition of Rs. 158.67 crores have been made on account of difference in stock between closing stock as mentioned in ITR for assessment year 2017-18 and the opening stock as mentioned in ITR for assessment year 2018-19. It is averred that the same was owing to disclosure required as per ‘Ind AS-105-non current asset held for sale and discontinued operations’ upon transfer of certain assets to FMC India Private Limited on 01.11.2017. The details were submitted before the authorities, and it was merely owing to classification upon transfer of certain assets to FMC India Private Limited, this income stood added while there is no impact on profitability. It is averred that there were no proper columns in the ITR and hence proper disclosure could not be made in the ITR. It is averred that the ld. DRP directed AO to verify the same , but the AO made the additions. It is averred by the assessee that the transferee company could not do business owing to certain approvals being required to carry out business which were being obtained by the transferee , and till then the assessee continued the business in its own name even after transfer(from Nov-March,2018) till approvals were received by the transferee . Thus, it is submitted that merely due to change in presentation, the amount was added to the income of the assessee while there is no such income which could have been brought to taxation.It is further averred that the income towards long term capital gains to the tune of Rs. 10.85 crores were added which was merely due to multiple reporting of the same transaction in SF-012 by Sub- Registrar i.e. thrice , being sale consideration of properties which were considered thrice owing to multiple reporting in SF-012 by Sub-Registrar. Thus,it is averred by the assessee that the said S.A.No.81/Del/2025 Arising out of ITA no. 1939/Del/2022 4 | P a g e income is added multiple times owing to taking sale consideration of properties sold thrice by the authorities. The ld. DRP directed AO to verify , but the ld. AO made the additions. There were TP additions as well other additions made by authorities , which are contested by the assessee. It was averred that the ITAT originally granted stay on recovery of outstanding demand of income-tax and interest on the condition that Rs. 39 crores be adjusted by the AO against the outstanding demand , from the refund due to the assessee, vide order in Stay Application No.281/Del/2022, dated 09.09.2022. The said stay of recovery of outstanding demand was extended by ITAT in Stay Application No. 125/Del/2023 , vide order dated 17.03.2023 and SA no. 355/Del/2023 vide order dated 22.09.2023. It is further submitted that the assessee has challenged the legality of the order passed by ld. DRP on the ground that the same was issued without a valid Documentation Identification Number (Ground No. 6 and 7), and intimation letter issued by CIT(DRP) is also invalid and bad in law as they do not meet the pre-requisite of Circular No. 19/2019 dated 14.08.2019 issued by CBDT. It was submitted that Revenue had sought adjournment on 07th February, 2024 on the ground that DIN issue is involved in this appeal. It was submitted that the ITAT on 27th November, 2024 adjourned the appeal of the assessee sine-die on the ground that DIN issue is involved in this appeal. The ld. Counsel for the assessee drew our attention to judgment and order of Hon’ble Supreme Court in the case of CIT v. Brandix Mauritius Holdings Limited , SLP(Diary No. 46964/2023). Our attention was drawn by learned counsel for the assessee to order sheet entries in ITA no. 1939/Del/2022 to buttress his arguments that the S.A.No.81/Del/2025 Arising out of ITA no. 1939/Del/2022 5 | P a g e assessee cooperated in the proceedings before ITAT in the appellate proceedings. It was prayed that stay on recovery of the outstanding demand towards income-tax and interest be granted, on the similar terms and conditions , on which the Division Bench of ITAT originally granted stay of outstanding demand vide its order in stay dated 09.09.2022 , which was later extended by orders dated 17.03.2023 and 22.09.2023. The ld. Sr. DR , on the other hand, submitted that recovery of Rs. 39 crores from refund due to the assessee was directed by the ITAT to be adjusted against the outstanding demand of Rs. 277.07 crores which has not been done so far, and since the fact position remaining same, the stay of demand may be granted on similar terms and condition as were originally granted by ITAT on 09.09.2022 which got further extended by SA order’s dated 17.03.2023 and 22.09.2023, and directions may be given to adjust Rs.39 crores against outstanding demand. 3. We have considered rival contentions and perused the material. We are of the considered view that the assessee has made out a prima-facie case for conditional part stay of recovery of outstanding demand of income-tax and interest thereon, on the same terms and conditions, on which originally stay on recovery of outstanding demand was granted by ITAT vide orders dated 09.09.2022 which got extended on 17.03.2023 and 22.09.2023 i.e. subject to recovery/deposit of Rs. 39 crores against the outstanding demand of income-tax and interest thereon. As we have observed , without commenting on the merits of the issues, that out of total additions made to the income of the assessee by the Revenue, it is claimed by the assessee that the addition to the S.A.No.81/Del/2025 Arising out of ITA no. 1939/Del/2022 6 | P a g e tune of Rs. 158.67 crores have been made to the income of the assessee on account of difference in stock between closing stock as mentioned in ITR for assessment year 2017-18 and the opening stock as mentioned in ITR for assessment year 2018-19, which the assessee has claimed was totally unwarranted as there was no difference in closing stock of the last year vis-à-vis opening stock of the current year. The assessee has also claimed that additions to the tune of Rs. 10.85 crores were added to the income of the assessee which was again totally unwarranted as this addition has arisen owing to multiple reporting of the same transaction in SF- 012 by Sub-Registrar i.e. thrice , being sale consideration of properties which were considered thrice owing to multiple reporting in SF-012 by Sub-Registrar. It is also claimed by the assessee that a rectification application is moved by the assessee for rectification of mistake of Rs. 7,09,96,544/- towards erroneous addition of interest u/s 234A made by the Revenue , while the return of income was originally filed on 29.11.2018 which was filed within due date as prescribed u/s 139(1) and no such interest ought to have been charged by the Revenue. At this stage we are concerned with the question of grant of stay and it will be totally undesirable for us to comment on the merits of the issues arising in the appeal filed by the assessee, and we refrain to do so. Proceeding further, We have observed that despite earlier directions given by ITAT while granting conditional part stay of outstanding demand of income-tax and interest to recover and adjustment of Rs. 39 crores from the refund due to the assessee against outstanding demand of income-tax and interest due thereon , the said recovery and adjustment of Rs.39 crores has S.A.No.81/Del/2025 Arising out of ITA no. 1939/Del/2022 7 | P a g e not been done by the Revenue. The AO shall take immediate steps to recover and adjust Rs. 39 crores from the refund due to the assessee, otherwise the assessee is directed to deposit the said amount of Rs. 39 crores if no refund is due and payable to the assessee. The AO shall adjust the same against the outstanding demand of income-tax and interest thereon. The assessee on its part shall also co-operate with the AO to submit relevant information w.r.t. adjustment of refunds claimed to be due to the assessee to the tune of Rs. 39 crores , or otherwise the assessee shall make payment/deposit of Rs. 39 crores with Revenue/Government if no refund is found to be due and payable to the assessee . We have observed from the order sheet entries that the assessee has co-operated in the proceedings before the ITAT in appellate proceedings in ITA no. 1939/Del/2022. We have observed that the ld. CIT-DR sought adjournment on 07.02.2024 on the ground that the appeal in ITA No. 1939/Del/2022 involves issue of DIN, keeping in view of judgment and order of Hon’ble Supreme Court in the case of Brandix(supra). The appeal later got adjourned sine-die by ITAT on 27.11.2024 on the grounds that the appeal involves issue of DIN. The assessee has challenged the legality of the order passed by ld. DRP before ITAT on the ground that the same was allegedly issued without a valid Documentation Identification Number (Ground No. 6 and 7), and it is also challenged by the assessee that the intimation letter issued by CIT(DRP) is also allegedly invalid and bad in law as they do not meet the pre-requisite of Circular No. 19/2019 dated 14.08.2019 issued by CBDT. Thus, keeping in view the entire facts and circumstances and in the interest of justice and without S.A.No.81/Del/2025 Arising out of ITA no. 1939/Del/2022 8 | P a g e commenting on the merits of the issue, we stay recovery of remaining outstanding demand towards income-tax and interest thereon of Rs. 230.97 crores vide this order in stay application, for a period of 180 days or till the disposal of the appeal in ITA no . 1939/Del/2022 , which ever is earlier, with the condition that Rs. 39 crores be adjusted/deposited towards the outstanding demand. The stay on recovery of aforesaid outstanding demand will become effectively operational on recovery and adjustment of Rs. 39 crores, either by adjustment of refund or deposit by assessee, as directed by us as above. The AO will take immediate steps towards the same. The appeal was adjourned sine-die as the issue involved in this appeal concerns issue of DIN, and the same shall continue to be so, till application for fixation of hearing is moved. We clarify that we have not commented on the merits of the issues arising in the appeal. It will be relevant to refer here to the order of Hon’ble Delhi High Court dated 29th July, 2022 in M/s Expeditors International of Washington Inc. v. ACIT, Circle International Tax 1(2)(2), Delhi in WP(C) 11032/2022 & C.Mo. No. 32314/2022. The terms and conditions of this stay order was announced in open court in the presence of both the parties. We order accordingly. 4. In the result, Stay Application is partly allowed in the manner as indicated above. Order pronounced in the open court on 21st February, 2025. - Sd/- d/- Sd/- (MAHAVIR SINGH) (RAMIT KOCHAR) VICE PRESIDENT ACCOUNTANT MEMBER Dated: 21st February, 2025. S.A.No.81/Del/2025 Arising out of ITA no. 1939/Del/2022 9 | P a g e Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A)/DRP 5. DR Asst. Registrar, ITAT, New Delhi "