HUAWEI TECHNOLOGIES INDIA PRIVATE LIMITED,BENGALURU V. DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE 2(1), BENGALURU, BENGALURU

SA 8/BANG/2025

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Huawei Technologies India Private Limited filed stay petitions against the outstanding demands for the assessment years 2020-21 and 2021-22. The total demand for these years was Rs.105,27,90,106. The company argued that the Revenue's interest was protected by a provisional attachment and requested a stay on the balance amount. The tribunal considered the provisional attachment and the pending refunds for earlier assessment years and decided to adjust the 20% of the outstanding demand with these amounts, staying the remaining demand until further proceedings.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 36815 (ITAT-BANGALORE)
• Appeal Type: Stay Application
• Pronouncement Date: 18-03-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Assessment Year: 2021-2022
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: PARITHIVEL V.; WAY OF PROVISIONAL
• Assessee Lawyers: PADAM KINCHA
• Section: 13; 244A

Judgement Text

"SP Nos.48/Bang/2024 & SP 8/Bang/2025 M/s. Huawei Technologies India Private Limited IN THE INCOME TAX APPELLATE TRIBUNAL “C’’ BENCH: BANGALORE BEFORE SHRI LAXMI PRASAD SAHU, ACCOUNTANT MEMBER AND SHRI KESHAV DUBEY, JUDICIAL MEMBER SP No.48/Bang/2024 (Arising out of IT(TP)A No.1558/Bang/2024) SP No.8/Bang/2025 (Arising out of IT(TP)A No.2282/Bang/2024) Assessment Years: 2020-21 & 2021-22 Huawei Technologies India Private Limited SY No.37, 46, 45/3, 45/4, ETC., KNO 154 Divyashree Technopark Kundalahalli Village Bengaluru 560 037 Karnataka PAN NO : AAACH8599L Vs. DCIT Central Circle-2(1) Bengaluru APPELLANT RESPONDENT Appellant by : Sri Padam Kincha, A.R. Respondent by : Sri Parithivel V., D.R. Date of Hearing : 27.02.2025 Date of Pronouncement : 18.03.2025 O R D E R PER KESHAV DUBEY, JUDICIAL MEMBER: These stay petitions are filed by the assessee seeking stay against the outstanding demand for the assessment years 2020-21 & 2021-22 as follows: AY Demand notice dated Demand raised 20% of demand 2019-20 Final assessment order not received 2020-21 26/06/2024 45,87,97,290/- 9,17,59,458/- 2021-22 27/09/2024 59,39,92,816/- 11,87,98,563/- Total 1,05,27,90,106 21,05,58,021/- SP Nos.48/Bang/2024 & SP 8/Bang/2025 M/s. Huawei Technologies India Private Limited Page 2 of 10 2. Both these stay petitions are clubbed together, heard together and disposed of by this common order for the sake of convenience and brevity. 3. At the outset, ld. Counsel for the assessee drew our attention on proceedings u/s 281B of the Income Tax Act, 1961 (in short “The Act”) i.e. the order extending period of provisional attachment (placed in pages 13 to 14 of the paper book compilation) which are reproduced below for ease of reference and convenience: SP Nos.48/Bang/2024 & SP 8/Bang/2025 M/s. Huawei Technologies India Private Limited Page 3 of 10 3.1 On going through the above, we find that the Principal Commissioner of Income Tax (Central) Bengaluru vide his letter dated 4.8.2023 under the provisions of section 281B (2) of the Act has extended the provisional attachment in the case of the assessee for a period up to 31.1.2025 for the account balance of Rs.19,53,18,408/- held by the assessee in DBS Bank India Ltd. Further, ld. A.R. of the assessee vehemently submitted that on 30.1.2025 the company wrote a letter to the ld. PCIT requesting to further extend the provisional attachment till 31.3.2025 and prayed not to make any further recovery of demand for the aforesaid years. The copy of which is enclosed herewith for ease of reference and record: SP Nos.48/Bang/2024 & SP 8/Bang/2025 M/s. Huawei Technologies India Private Limited Page 4 of 10 SP Nos.48/Bang/2024 & SP 8/Bang/2025 M/s. Huawei Technologies India Private Limited Page 5 of 10 3.2 Further, the ld. A.R. of the assessee also drew our attention on a letter dated 14/02/2025 received by the assessee company from the DBS Bank India Ltd. intimating to the assessee that they have received a notice from Income Tax Department vide DIN & Letter No. ITBA/COM/F17/2024-25/1072776483(1) India dated 31.1.2025 and in reference to the same the maturity instruction for FD account No.8827230811022729 has been changed as renew principal and interest till further notice, the copy of which is reproduced below for ease of reference and record: SP Nos.48/Bang/2024 & SP 8/Bang/2025 M/s. Huawei Technologies India Private Limited Page 6 of 10 SP Nos.48/Bang/2024 & SP 8/Bang/2025 M/s. Huawei Technologies India Private Limited Page 7 of 10 3.3 Lastly, the ld. A.R. of the assessee submitted that the refund for assessment years 2003-04, 2010-11 & 2011-12 are pending before the Department and the assessee has not yet received the said refunds for the above mentioned Asst. years in spite of the fact that OGE/154 petitions are pending before the Revenue Authorities. 4. The ld. D.R. on the other hand vehemently objected the adjustments of refund for the AYs 2003-4, 2010-11 & 2011-12 with the outstanding demands for the Asst. year 2020-21 & 2021-22 and also submitted that even provisional attachment was granted for a period up to 31.1.2025 only and it is yet to be extended. 5. We have heard the rival submissions and perused the materials available on record. It is undisputed fact that the assessee company on 30.1.2025, wrote a letter to the ld. PCIT requesting to further extend the provisional attachment till 31.3.2025. Further we also take a note of the fact that the assessee company has already received a letter from the DBS Bank intimating that the maturity instruction for FD account No.8827230811022729 has been changed as renew principal and interest till further notice as per the notice received from Income Tax Department vide DIN & Letter No. ITBA/COM/F17/2024-25/1072776483(1) India dated 31.1.2025. Therefore, we agree with the contention of the AR of the assessee that the account balance of Rs.19,53,18,408/- held by the assessee in DBS Bank India Ltd is still with the Department by way of provisional attachment. Now, the total demand outstanding for the assessment years under consideration are Rs.1,05,27,90,106/-. The contention of the ld. Counsel for the assessee is that for granting stay of the disputed demand, even if 20% of the total outstanding demand amounting to Rs.21,05,58,021/- is considered, the Revenue’s interest is already protected by the attachment and hence stay may SP Nos.48/Bang/2024 & SP 8/Bang/2025 M/s. Huawei Technologies India Private Limited Page 8 of 10 be granted for the balance amount for the Asst. year 2020-21 & 2021- 22. 5.1 As per section 254(2A) of the Act, the Tribunal may after considering the merit of the application made by the assessee, pass an order of stay in any proceedings in relation to an appeal under sub-section (1) of section 254 of the Act, for a period of not exceeding 180 days from the date of such order subject to the condition that the assessee deposited not less than 20% of the amount of tax, interest, fee, penalty or any other sum payable under the provisions of this Act or furnishes security of equal amount in respect there of and the appellate tribunal has to dispose of the appeal within the said period of stay specified in the order. In our opinion, once a statutory provision specifically provides that the Tribunal can only grant a stay subject to deposit of not less than 20% of the disputed demand or furnishing of security of equal amount thereof, it is not open to this Tribunal to grant stay in violation of this basic provision as the Tribunal being a creation of the statute and we are not in a position to question the provisions of this section 254(2A) of the Act. 5.2 Coming to the fact of the present case, as rightly pointed out by the ld. Counsel for the assessee that the total outstanding demand for the assessment year 2020-21 as well as 2021-22 are Rs.105,27,90,106/-, whereas the amount with DBS Bank India Ltd amounting to Rs. Rs.19,53,18,408/-is already held as per the provisional attachment u/s 281B of the Act. Further, the refunds receivables with respect to the assessment years in AYs 2003-04, 2010-11 & 2011-12 are reproduced below for ease of reference and convenience placed at page 30 of the paper book compilation: SP Nos.48/Bang/2024 & SP 8/Bang/2025 M/s. Huawei Technologies India Private Limited Page 9 of 10 Details of pending refund Assessment year Refund Amount (Rs.) 2003-04 26,70,380/- & Interest thereon 2010-11 5,16,37,477/-& Interest thereon 2011-12 1,43,81,775/- 5.3 Being so, considering the totality of the facts of the case, it will be unjust for the assessee, if we direct the assessee to pay 20% of the total outstanding demand for the assessment years 2020-21 & 2021- 22 again specially when the amount of Rs.19,53,18,408/- has been held under the provisional attachment by the department and as claimed by the assessee a total amount of Rs.6,86,89,632/- along with the Interest u/s 244A thereon are pending for granting refund for assessment years 2003-04, 2010-11 & 2011-12. Accordingly, it will be just & proper, if we direct the AO that the 20% of total outstanding demand for the assessment years 2020-21 & 2021-22 amounting to Rs.21,05,58,021/- (Rs.105,27,90,106/- x 20%) may be adjusted with the amount lying with the provisional attachment amount of Rs.19,53,18,408/- and balance Rs.1,52,39,613/- may be adjusted with the pending refunds for assessment years 2003-04, 2010-11 & 2011-12 amounting to Rs.6,86,89,632/-. The balance amount of outstanding demand for the assessment years 2020-21 & 2021-22 are stayed for payment till 180 days from the date of issue of this order or till the disposal of appeal, whichever is earlier on the above terms. The AO is also directed to issue refunds for the assessment years 2003-04, 2010-11 & 2011-12 after adjusting the amount of Rs.1,52,39,613/-. The stay petitions are disposed of as per the terms indicated above. We also direct the assessee that if during the period of stay granted, the provisional attachment stands vacated for any reason, then the assessee shall within 7 days from the date of vacation forthwith deposit the amount of SP Nos.48/Bang/2024 & SP 8/Bang/2025 M/s. Huawei Technologies India Private Limited Page 10 of 10 Rs.19,53,18,408/- & thereafter submit the copy of the challan to the Department forthwith. It is ordered accordingly. 6. In the result, stay petitions filed by the assessee for both these years are partly allowed for statistical purposes. Order pronounced in the open court on 18th Mar, 2025 Sd/- (Laxmi Prasad Sahu) Accountant Member Sd/- (Keshav Dubey) Judicial Member Bangalore, Dated 18th Mar, 2025. VG/SPS Copy to: 1. The Applicant 2. The Respondent 3. The CIT 4. The DR, ITAT, Bangalore. 5 Guard file By order Asst. Registrar, ITAT, Bangalore. "