M/s Rawmin Mining & Industries Pvt. Ltd., Porbandar V. The Dy. Commr. of Income Tax, Circle-2, Jamnagar

SA 01/RJT/2019

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 6494 (ITAT-RAJKOT)
• Duration Of Justice: 2 month(s) 23 day(s)
• Appeal Type: Income Tax (International Taxation) Appeal
• Pronouncement Date: 04-05-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2010-2011
• Appeal Filed On: 11-02-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: DM RINDANI
• Keywords: Recovery proceedings
• Section: 234B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL RAJKOT BENCH, RAJKOT BEFORE SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER & SMT. MADHUMITA ROY, JUDICIAL MEMBER STAY PETITION NO. 1/RJT/2019-AY 2010-11 ( IN I.T.A. NO. 420/RJT/2018-AY 2010-11 ) M/S. RAWMIN MINING & INDUSTRIES PVT. LTD. EAST KADIA PLOT, PORBANDAR - 360575 / VS. THE DCIT CIRCLE-2, JAMNAGAR / / PAN/GIR NO. : AABCR3228D ( / APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY : SHRI D. M. RINDANI, A.R. / RESPONDENT BY : SHRI JITENDER KUMAR, CIT. D.R. / DATE OF HEARING 15/02/2019 !'# / DATE OF PRONOUNCEMENT 15/02/2019 / O R D E R PER PRADIP KUMAR KEDIA - AM: BY THIS STAY PETITION DATED 08.02.2019, THE ASSESSE E SEEKS STAY OF OUTSTANDING DEMAND OF RS.1,33,04,425/- WHIC H INCLUDES DEMAND OF RS.1,06,80,274/- TOWARDS INTEREST CHARGEA BLE UNDER S.234A, 234B AND 234C OF THE INCOME TAX ACT, 1961 ( THE ACT). 2. WHEN THE STAY PETITION MOVED BY THE ASSESSEE WAS CALLED FOR HEARING, THE LEARNED AR FOR THE ASSESSEE AT THE OUT SET SUBMITTED THAT A TOTAL SUM OF RS.2,39,84,699/- WAS RAISED ON THE ASSESSEE AS S.P. NO. 1/RJT/19 [M/S. RAWMIN MINING & INDUSTRIES PVT. LTD. VS. DCIT] A.Y. 2010-11 - 2 - A RESULT OF ADDITION OF RS.3,46,66,804/- ON ACCOUNT OF ALLEGED UNDER INVOICING OF EXPORT SALES OF BAUXITE. THE LE ARNED AR SUBMITTED THAT THE ADDITIONS SO MADE ARE PRIMA FACIE UNJUSTIFIED ON FACTS. IT WAS CLAIMED THAT THE ASSESSEE HAS A G OOD CASE TO SUCCEED ON MERITS IN ITS APPEAL BEFORE THE ITAT. E XTENDING FURTHER, THE LEARNED AR FOR THE ASSESSEE CONTENDED THAT THE FINANCIAL POSITION OF THE ASSESSEE IS EXTREMELY PRE CARIOUS AND DOES NOT PERMIT THE ASSESSEE TO DISCHARGE THE ONEROUS TA X OBLIGATION SADDLED ON IT AS A RESULT OF THE AFORESAID ADDITION TO THE TOTAL INCOME. THE LEARNED AR POINTED OUT THAT THE BANK A CCOUNT OF THE ASSESSEE HAS ALREADY SLIPPED INTO NPA (NON-PERFORMI NG ASSET) AS MARKED BY THE LENDER BANK AND THE RE-STRUCTURING OF ITS CASH CREDIT FACILITY WITH THE BANK IS UNDER NEGOTIATION. IT WA S FURTHER STATED THAT THERE IS NO TURNOVER OR SALE IN THE CURRENT YE AR DUE TO CONSTRAIN OF FINANCIAL RESOURCES. THIS APART, THE LEARNED AR FOR THE ASSESSEE VEHEMENTLY STRESSED THAT THE ASSESSEE HAS ALREADY PAID NEARLY RS.1,06,80,274/- IN AGGREGATE IN INSTAL LMENTS IN THE PAST WHICH NEARLY COVERS 45% OF THE TOTAL DEMAND AN D 90% OF THE PRINCIPAL DEMAND. IN THE CIRCUMSTANCES, THE LEARNE D AR SUBMITTED THAT THE ASSESSEE IS NO MORE IN A POSITION TO MEET THE REQUEST OF THE DEPARTMENT FOR FURTHER PAYMENT. THE LEARNED AR ACCORDINGLY URGED THAT THE OUTSTANDING DEMAND MAY BE STAYED FRO M RECOVERY PROCEEDINGS BY THE DEPARTMENT AND FURTHER PRAYED FO R FIXATION OF THE CASE FOR OUT OF TURN HEARING IMMEDIATELY. 3. THE LEARNED DR, ON THE OTHER HAND, STRONGLY OPPO SED THE SAID APPLICATION FILED BY THE ASSESSEE. THE LEARNE D DR SUBMITTED THAT THE TOTAL STAY OF THE OUTSTANDING DEMAND IS NO T JUSTIFIED AT ALL AND DESERVES TO BE REJECTED. S.P. NO. 1/RJT/19 [M/S. RAWMIN MINING & INDUSTRIES PVT. LTD. VS. DCIT] A.Y. 2010-11 - 3 - 4. ON CAREFUL EXAMINATION OF THE RIVAL SUBMISSIONS AS WELL AS MATERIAL ASPECTS OF THE CASE WHICH ARE RELEVANT TO ASCERTAIN THE BALANCE OF CONVENIENCE SUCH AS FINANCIAL CRISIS PLE ADED ON BEHALF OF THE ASSESSEE, PAST CONDUCT IN DISCHARGING SUBSTA NTIAL OUTSTANDING OF THE PRINCIPAL DEMAND, WE ARE OF THE VIEW THAT MITIGATING CIRCUMSTANCES DULY EXIST IN THE PRESENT CASE TO GRANT STAY OF THE OUTSTANDING DEMAND. IN VIEW OF THE OVE RWHELMING FACTS TOWARDS PAYMENT OF NEARLY 90% OF THE PRINCIPA L COMPONENT OF THE TAX DEMAND, WE ARE OF THE VIEW THAT THE REVE NUE WOULD NOT SUFFER ANY IRREPARABLE PREJUDICE IF THE INTERIM REL IEF IS GRANTED TO THE ASSESSEE BY WAY OF STAY OF OUTSTANDING DEMAND T OGETHER WITH OUT OF TURN-HEARING. WE THUS ENTERTAIN THE STAY PE TITION IN AFFIRMATIVE AND EXERCISE OUR DISCRETION IN FAVOUR O F THE ASSESSEE FOR STAY OF RECOVERY OF BALANCE OUTSTANDING DEMAND FOR A PERIOD OF SIX MONTHS OR TILL DISPOSAL OF THE APPEAL OF THE AS SESSEE BY THE TRIBUNAL, WHICHEVER IS EARLIER. THE REGISTRY IS DI RECTED TO FIX THE ASSESSEES APPEAL IN ITA NO.420/RJT/2018 FOR OUT OF TURN-HEARING ON 26.03.2019 AS ANNOUNCED IN THE OPEN COURT AND INFORMED TO THE REPRESENTATIVES OF BOTH SIDES. NO SEPARATE NOTICE OF HEARING WOULD THUS BE REQUIRED. THE PARTIES WILL FILE ALL THE REQUISITE DOCUMENTS, PAPER BOOK ETC. WELL IN ADVANCE FOR EXPE DITIOUS DISPOSAL OF APPEAL. 5. THE STAY GRANTED IS SUBJECT TO THE CONDITION THA T THE ASSESSEE WILL FULLY CO-OPERATE IN SPEEDY DISPOSAL OF THE APP EAL AND WILL NOT SEEK ADJOURNMENT ON ANY PRETEXT FROM PARTICIPATING IN THE APPELLATE PROCEEDINGS BEFORE THE TRIBUNAL. THE STA Y GRANTED HEREINABOVE MAY STAND VACATED FORTHWITH TOGETHER WI TH BENEFIT OF OUT OF TURN HEARING OF THE APPEAL AT THE DISCRETION OF THE TRIBUNAL S.P. NO. 1/RJT/19 [M/S. RAWMIN MINING & INDUSTRIES PVT. LTD. VS. DCIT] A.Y. 2010-11 - 4 - IN THE EVENT OF FAILURE TO COMPLY WITH THE DIRECTIO N SET OUT HEREINABOVE. 6. IN THE RESULT, STAY PETITION FILED BY THE ASSESS EE IS ALLOWED. SD/- SD/- (MADHUMITA ROY) (PRADIP KUMA R KEDIA) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD: DATED 15/02/2019 TRUE COPY S. K. SINHA COPY OF THE ORDER FORWARDED TO:- 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS) 4. THE CIT CONCERNED. 5. THE DR., ITAT, AHMEDABAD. 6. GUARD FILE. BY ORDER DEPUTY/ASSTT.REGISTRAR ITAT, R AJKOT THIS ORDER IS PRONOUNCED IN THE OPEN COURT ON COMP LETION OF HEARING TODAY ON 15/02/2019