DGS TECHNICAL SERVICES PRIVATE LIMITED,HYDERABAD V. DCIT., CIRCLE-8(1), HYDERABAD

SA 23/HYD/2025

AI Insights

The case involves DGS Technical Services Private Limited, which filed a stay application against the collection of an outstanding tax demand of Rs.7,33,24,229. The assessee argued that the tax demand was based on incorrect transfer pricing adjustments made by the Assessing Officer, which significantly altered their declared loss into a taxable income. The Revenue opposed the stay, emphasizing the need for the assessee to pay at least 20% of the disputed amount to qualify for a stay. The tribunal dismissed the stay application due to the assessee's failure to comply with the payment requirement and their preference for an early hearing over making the required payment.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 716839 (ITAT-HYDERABAD)
• Duration Of Justice: 11 day(s)
• Appeal Type: Stay Application
• Pronouncement Date: 22-08-2025
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB-A
• Assessment Year: 2021-2022
• Appeal Filed On: 11-08-2025
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: BOSU BABU ALLI
• Assessee Lawyers: H. SRINIVASULU
• Keywords: Application of stay

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD “A” BENCH: HYDERABAD BEFORE SHRI MANJUNATHA G, ACCOUNTANT MEMBER AND SHRI RAVISH SOOD, JUDICIAL MEMBER Stay Application No.23/Hyd./2025 Arising out of ITA.No.1095/Hyd./2024 - Assessment Year 2021-2022 DGS Technical Services Private Limited, Hyderabad – 500 034. Telangana. PAN AACCD0741Q vs. The DCIT, Circle-8(1), Hyderabad. (Applicant) (Respondent) For Assessee : Sri H. Srinivasulu, Advocate For Revenue : Sri Bosu Babu Alli, Sr. AR Date of Hearing : 22.08.2025 Date of Pronouncement : 22.08.2025 ORDER PER MANJUNATHA, G. By this stay application, the assessee seeks to stay of collection of outstanding demand of tax and interest amounting to Rs.7,33,24,229/-. 2. Sri H. Srinivasulu, Advocate-Learned Counsel for the Assessee referring to the stay application filed by the assessee along with affidavit dated 06.08.2025 submitted Printed from counselvise.com 2 SA.No.23/Hyd./2025 that, the assessee has filed it’s return of income declaring loss of Rs.7,19,87,240/-, whereas the Assessing Officer determined the total income of the assessee at Rs.17,34,22,310/- by making addition of Rs.24,54,09,549/- in terms of TP adjustment u/sec.92CA of the Income Tax Act, 1961 vide order dated 18.09.2024 passed u/sec.143(3) of the Income Tax Act, 1961. The assessee has prima facie case on merits because, the Assessing Officer has made adjustment by incorrect computation of PLI and also comparables and if the assessee succeeds in the appeal on these issues, the TP adjustment made by the Assessing Officer reduced to the loss and question of making payment of tax does not arise. Further, the is assessee having financial difficulty and even facing problems to pay salaries to staff. Therefore, he submitted that, the stay may be granted to the outstanding demand till the disposal of the appeal. 3. Sri Bose Babu Alli, Sr. AR for the Revenue, on the other hand, strongly opposed application filed by the assessee for stay of collection of outstanding demand and Printed from counselvise.com 3 SA.No.23/Hyd./2025 submitted that, for granting stay, the assessee need to pay 20% of the disputed tax and, therefore, the assessee may be directed to pay atleast 20% of the disputed amount before granting any stay. 4. We have heard both the parties, considered the relevant submissions of the assessee in their application filed for stay of outstanding demand and we find that, although, the assessee has made various arguments on the issue of prima facie merits of the case and balance of convenience, but when the Bench posed a specific question to the Counsel for the Assessee on the issue of statutory requirement of making 20% payment for disputed tax demand before granting any stay, the Learned Counsel for the Assessee expressed his inability to make any payment and further requested for an early hearing of the matter, so that, he can argue the appeal on the next date of hearing. Since the appellant not willing to pay the required amount of tax for granting stay and also expressed his willingness to argue the appeal on the next date of hearing, in our considered view, the stay application filed by the assessee Printed from counselvise.com 4 SA.No.23/Hyd./2025 needs to be dismissed. Thus, we dismiss the stay application filed by the assessee. The appeal of assessee will come-up for hearing on 08.09.2025 and we direct the Registry to list the appeal on the date of hearing as ‘first on board’. Since the next date of hearing is announced in the open Court, no separate notice will go to the parties. Accordingly, stay application of the assessee is dismissed. 5. In the result, stay application of the assessee is dismissed. Order pronounced in the open Court on 22.08.2025. Sd/- Sd/- [RAVISH SOOD] [MANJUNATHA G] JUDICIAL MEMBER ACCOUNTANT MEMBER Hyderabad, Dated 22nd August, 2025 VBP Copy to 1. DGS Technical Services Private Limited, 3rd Floor, Shiv Shakti Towers, H.No.8-2-700/A, Road No.12, Khairatabad, Hyderabad – 500 034. Telangana. 2. The DCIT, Circle-8(1), Signature Towers, Sy.No.6(P), Sy.No.37(P), Kothaguda, Opp. Botanical Gardens, Serilingampally (M), Hyderabad – 500 084. Telangana. 3. The Pr. CIT, Hyderabad. 4. The DR ITAT “A” Bench, Hyderabad. 5. Guard File. //By Order// //True Copy// Printed from counselvise.com "