DCIT CIR 2(1), MUMBAI V. FULFORD (INDIA) LTD, MUMBAI

MA 163/MUM/2019

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 8473 (ITAT-MUMBAI)
• Duration Of Justice: 26 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 01-04-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: K
• Assessment Year: 2009-2010
• Appeal Filed On: 06-03-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANISH KUMAR SINGH
• Keywords: Application of stay
• Section: 205

Judgement Text

THE INCOME TAX APPELLATE TRIBUNAL K BENCH, MUMBAI BEFORE SHRI SHAMIM YAHYA ( A M) & SHRI AMARJIT SINGH ( J M) M.A. NO. 163/MUM/2019 ARISING OUT OF S.A. NO. 374 /MUM/ 201 8 (ASSESSMENT YEAR 20 09 - 10 ) M.A. NO. 164/MUM/2019 ARISING OUT OF S.A. NO. 375/MUM/ 2018 (ASSESSMENT YEAR 2011 - 12) DCIT CIRCLE - 2(1) ROOM NO. 561 AAYAKAR BHAVAN M.K. ROAD MUMBAI - 400 020. V S . FULFORD (INDIA) LIMITED PLATINA HOUSE, 8 TH FLOOR C - 59, G - BLOCK BKC MANDRA EAST MUMBAI - 400 051. PAN : AAACF1795L ( APPELLANT ) ( RESPONDENT ) ASSES SEE BY SHRI MADHUR AGARWAL DEPARTMENT BY SHRI MANISH KUMAR SINGH DATE OF HEARING 27 . 3 . 201 9 DATE OF PRONOUNCEMENT 1.4 . 201 9 O R D E R PER SHAMIM YAHYA (AM) : BY WAY OF THESE MISCELLANEOUS APPLICATIONS THE REVENUE SEEKS RECTIFICATION OF S TAY ORDER GRANTED BY THIS TRIBUNAL IN STAY APPLICATION NO. 374/MUM/2018 AND STAY APPLICATION NO. 375/MUM/2018 BY THE ORDER DATED 10.8.2018. 2. IN THE SAID STAY ORDER THE TRIBUNAL HAD GRANTED STAY UPON FINDING THAT ASSESSEE COMPLIED WITH THE TERMS OF STAY GRANTED IN THIS CASE ON EARLIER OCCASION AND SUBSEQUENTLY HEARING OF APPEAL COULD NOT TAKE PLACE DUE TO NO FAULT OF THE ASSESSEE. 3. NOW, BY WAY OF THIS MISCELLANEOUS APPLICATIONS THE REVENUE CONTENDS THAT THE ASSESSEE HAS BEEN GRANTED STAY SUBSEQUENTLY AFTER INIT IAL STAY GRANTED ON 31.1.2014. THAT T HE STAY HAS GRANTED SUBSEQUENTLY ON ELEVEN OCCASIONS FOR MORE THAN 365 DAYS WHICH IS IN CONTRAVENTION OF SECTION 254(2A) OF THE ACT. IT FULFORD (INDIA) LIMITED 2 IS FURTHER SUBMITTED THAT ON GOING THROUGH THE FINANCIALS OF THE ASSESSEE IT IS SEEN THAT THE ASSESSEE IS IN A POSITION TO PAY TAX. IT IS FURTHERMORE SUBMITTED THAT THE REVENUE HAS STRONG CASE ON MERITS HENCE, IT HAS BEEN SUBMITTED THAT THE STAY REQUIRES TO BE REVIEWED. 4. LEARNED COUNSEL OF THE ASSESSEE ON THE OTHER HAND SUB MITTED THAT THERE IS NO CHANGE IN THE FACTS AND CIRCUMSTANCES OF THE CASE S INCE FIRST STAY WAS GRANTED . HE SUBMITTED THAT SUBSEQUENTLY THE HEARING OF THE STAY COULD NOT TAKE PLACE DUE TO NO FAULT OF THE ASSESSEE. HENCE, HE SUBMITTED THAT THERE IS CAUSE FOR REVIEW OF THE STAY GRANTED. 5. UPON CAREFUL CONSIDERATION, WE NOTE THAT IT IS UNDISPUTED FACT THAT THE ASSESSEE HAS COMPLIED WITH TERMS AND CONDITIONS OF THE FIRST STAY IN THIS CASE. SUBSEQUENTLY, STAY HAS BEEN EXTENDED BY THE INCOME TAX APPE L LATE TRIBUN AL. LAST STAY WAS GRANTED ON 10.8.2018. THERE IS NO CASE MADE OUT THAT THERE IS FAILURE ON THE PART OF THE ASSESSEE TO COMPLY WITH THE TERMS AND CONDITION OF THE LAST STAY OR THAT HEARING OF APPEAL COULD NOT TAKE PLACE DUE TO ANY REASONS ATTRIBUTABLE TO THE ASSESSEE. 6. WE FURTHER NOTE THAT THE REVENUES CONTENTION IS MISPLACED AND IT IS CONTENDED THAT THE STAY CANNOT BE GRANTED BY THE TRIBUNAL BEYOND A PERIOD OF 365 DAYS AS IT IS CLAIM ED THAT IT COULD BE IN CONTRAVENTION OF SECTION 254(2A) OF THE ACT. IN THIS REGARD, WE NOTE THAT HON'BLE HON'BLE JURISDICTIONA L HIGH COURT IN THE CASE OF CIT VS. TATA TELESERVICE (MAHARASHTRA) LTD. (W.P.NO. 3437/2015 AND OTHERS JUDGEMENT DATED 16.12.2015) HAS EXPOUNDED THAT EVEN AFTER INTRODUCTION OF THE THIRD PROVISO TO SECTION 254(2A), THE TRIBUNAL CAN GRANT STAY BEYOND A PERIOD OF 365 DAYS. HON'BLE BOMBAY HIGH COURT HAS REFERRED TO THE DECISION OF HON'BLE DELHI HIGH COURT IN THE CASE OF PEPSI FOODS PVT. LTD. (376 ITR 87) IN WHICH THE SAID THIRD PROVISO TO SECTION 254 HA S BEEN STRUCK DOWN. HON'BLE APEX COURT HAS ALSO DISMISSED THE SLP BY THE DEPARTMENT AGAINST THE ABOVE DECISION OF HON'BLE DELHI HIGH COURT . HENCE, SUBMISSION OF FULFORD (INDIA) LIMITED 3 THE REVENUE THAT THE STAY HAS BEEN GRANTED FOR MORE THAN 365 DAYS IN CONTRAVENTION OF SECTION 254(2A) OF THE ACT IS DISMISSED. 7. FURTHER AS REGARDS PRIMA FACIE CASE IS CONCERNED, WE FIND THAT THE FIRST STAY WAS GRANTED ON 31.1.2014. IT IS NOT THE CASE OF THE REVENUE THAT THERE IS CHANGE IN THE CIRCUMSTANCES OR LAW, WHICH MAY MANDATE VARIATION IN THE TERMS OF STAY. IN THIS REGARD, HON'BLE BOMBAY HIGH COURT IN THE CASE OF VODAFONE INDIA LTD. VS. UNION OF INDIA (WRIT PETITION NO. 2425 OF 2013 VIDE ORDER DATED 23.6.2014) HAS EXPOUNDED THAT THE ITAT CANNOT VARY TERMS OF INITIAL STAY UNLESS THERE IS CH ANGE IN THE FACTS AND CIRCUMSTANCES OF THE CASE. FURTHER AS REGARDS REVENUES RELIANCE ON HON'BLE APEX COURT DECISION IN THE CASE OF ASIAN RESURFACING OF ROAD AGENCY PVT LTD (SUPRA) IS CONCERNED, WE FIND SAME IS MISPLACED IN AS MUCH AS THE SAME IS NOT APPL ICABLE TO PROCEEDINGS U/S. 254 OF THE I.T. ACT BEFORE THE ITAT. IN THIS REGARD HON'BLE BOMBAY HIGH COURT IN THE CASE OF ORACLE FINANCIAL SERVICES SOFTWARE LTD., HAS HELD AS UNDER : 4. WE ARE PRIMA FACIE OF THE VIEW THAT THE REVENUE AUTHORITIES COMMITTED SERIOUS ERROR. AGAINST THE TOTAL DEMAND ARISING OUT OF THE ORDER OF ASSESSMENT OF RS. 205 CRORE, THE ASSESSING OFFICER HAS ALREADY RECOVERED A TOTAL OF RS. 140 CRORES BY NOW THROUGH DIFFERENT MEANS. THERE IS NO ALLEGATION THAT THE PETITIONER IS RESPONSIBLE FOR DELAY IN DISPOSAL OF THE APPEAL BEFORE THE COMMISSIONER. MERELY RELYING UPON THE DECISION OF THE SUPREME COURT IN THE CASE OF ASIAN RESURFACING OF ROAD AGENCY PVT LTD (SUPRA), REVENUE AUTHORITIES NOW HELD A BELIEF THAT ANY STAY AGAINST THE RECOVERY GR ANTED WOULD AUTOMATICALLY LAPSE AFTER SIX MONTHS. THIS IS NEITHER THE PURPORT OF THE JUDGMENT OF THE SUPREME COURT, NOR THE OBSERVATIONS MADE IN THE SAID JUDGMENT IN THE CONTEXT OF CIVIL AND CRIMINAL LITIGATION CAN BE IMPORTED IN PRESENT SET OF QUASI JUDIC IAL PROCEEDINGS. THE POWER OF THE ASSESSING OFFICER TO REVIEW THE SITUATION EVERY SIX MONTHS, WOULD NOT AUTHORIZED HIM TO LIFT THE STAY PREVIOUSLY GRANTED AFTER FULL CONSIDERATION AND INSIST ON FULL PAYMENT OF TAX WITHOUT THE ASSESSEE BEING RESPONSIBLE FOR DELAY IN DISPOSAL OF THE APPEAL OR ANY OTHER SUCH SIMILAR MATERIAL CHANGE IN CIRCUMSTANCES. 8. IN THE BACKGROUND OF THE AFORESAID DISCUSSION, WE DO NOT FIND ANY REASON TO REV IEW THE STAY GRANTED IN THIS CASE BY THE ITAT. FULFORD (INDIA) LIMITED 4 9. IN THE RESULT, MISCELLANEOU S APPLICATIONS STAND DISMISSED. ORDER HAS BE EN PRONOUNCED IN THE COURT ON 1 . 4 . 201 9 . SD/ - SD/ - (AMARJIT SINGH ) (SH A MIM YAHYA ) J U DICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; DATED : 1 / 4 / 20 1 9 COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. BY ORDER, //TRUE COPY// ( SENIOR P RIVATE S ECRETARY ) PS ITAT, M UMBAI