M/s Hotel Woodside, Mangalore V. Assistant Commissioner of Income Tax, Circle-1(1)., Mangaluru

SA 214/BANG/2018

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 6071 (ITAT-BANGALORE)
• Duration Of Justice: 2 year(s) 8 month(s) 7 day(s)
• Appeal Type: Income Tax (Transfer Pricing) Appeal
• Pronouncement Date: 01-05-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2006-2007
• Appeal Filed On: 24-08-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SIDDAPPAJI BENGALURU
• Keywords: Recovery proceedings; Extension of stay

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH : BANGALORE BEFORE SHRI N.V. VASUDEVAN, JUDICIAL MEMBER AND SHRI A.K. GARODIA , ACCOUNTANT MEMBER SP NO.214/BANG/2018 [IN I TA NO. 1270/BANG/2016] ASSESSMENT YEAR : 2006 - 07 M/S. HOTEL WOODSIDE, C/O. MOHTISHAM COMPLEXES P. LTD., 6 TH FLOOR, EMPIRE MALL, M.G. ROAD, MANGALURU 562 162. PAN: AAAFH 8517P VS. THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 1(1), MANGALORE. APPL IC ANT RESPONDENT APPL IC ANT BY : SHRI NARENDRA SHARMA, ADVOCATE RE SPONDENT BY : SHRI SIDDAPPAJI, ADDL .CIT(DR)(ITAT), BENGALURU. DATE OF HEARING : 03 .0 9 .201 8 DATE OF PRONOUNCEMENT : 03 .09.2018 O R D E R PER N.V. VASUDEVAN, JUDICIAL MEMBER THIS IS AN APPLICATION FILED BY THE ASSESSEE PR AYING FOR AN ORDER EXTENDING THE ORDER OF STAY OF RECOVERY OF OUTSTAND ING DEMAND OF RS.8,30,92,838 FOR A PERIOD OF SIX MONTHS FROM 04.0 9.2018 OR TILL THE DISPOSAL OF THE APPEAL. 2. IT HAS BEEN STATED IN THIS APPLICATION THAT THE APPEALS WERE POSTED FOR HEARING BEFORE THE CIRCUIT BENCH OF THE TRIBUNA L AT MANGALORE ON 02.02.2017 AND THE CASE WAS HEARD AND RESERVED FOR ORDERS. LATER THE APPEAL SO HEARD AND RESERVED FOR ORDERS WAS RELEASE D AND LISTED TO BE SP NO.214/BANG/2018 PAGE 2 OF 3 POSTED FOR FRESH HEARING. SINCE THE DEPARTMENT HA D ATTACHED ALL THE RENTALS RECEIVABLE AND THE ASSESSEE HAD NO FUNDS TO PAY THE OUTSTANDING DEMAND, THEREFORE A STAY PETITION WAS FILED BEFORE THE TRIBUNAL AND THE TRIBUNAL VIDE ITS ORDER DATED 01.09.2017 IN SP NO.1 47/BANG/2017 GRANTED STAY AGAINST RECOVERY OF THE OUTSTANDING DEMAND FOR A PERIOD OF THREE MONTHS. THEREAFTER THE APPEAL WAS HEARD ON 08.11.2 017 AND RESERVED FOR ORDERS. THE STAY EXPIRED ON 30.11.2017, UPON WHICH THE DEPARTMENT ISSUED GARNISHEE NOTICES U/S. 226(3) OF THE INCOME- TAX ACT, 1961 [THE ACT] TO THE BANKS/TENANTS. THEREAFTER, ANOTHER ST AY PETITION WAS FILED BEFORE THE TRIBUNAL IN SP NO.66/BANG/2018 AND THE T RIBUNAL VIDE ITS ORDER DATED 09.03.2018 GRANTED STAY FOR A PERIOD OF 180 D AYS WHICH EXPIRES ON 04.09.2018. THE LD. COUNSEL FOR THE ASSESSEE SUBM ITTED THAT THE AO VIDE LETTER DATED 08.08.2018 HAS INTIMATED ABOUT INITIAT ION OF RECOVERY PROCEEDINGS AGAINST THE ASSESSEE ON EXPIRY OF THE S TAY ON 04.09.2018 AND HENCE THE PRESENT STAY PETITION. 3. IT WAS FURTHER SUBMITTED THAT THE ASSESSEE HAS PAID MORE THAN 50% OF THE DISPUTED TAXES AND IT IS HARD PRESSED FOR FU NDS TO PAY THE OUTSTANDING DEMAND. ON MERITS, IT IS SUBMITTED THAT THE ASSESS EE IS CONFIDENT OF SUCCEEDING IN ITS APPEAL BEFORE THE TRIBUNAL. THE N ON-DISPOSAL OF THE APPEAL BEFORE THE TRIBUNAL IS NOT ATTRIBUTABLE TO T HE ASSESSEE. THEREFORE, IT IS PRAYED FOR AN ORDER OF EXTENSION OF STAY. 4. WE HAVE HEARD THE RIVAL SUBMISSIONS. FROM THE FACTS NARRATED ABOVE, IT IS CLEAR THAT THE DELAY IN NON-DISPOSAL O F THE APPEAL IS NOT ATTRIBUTABLE TO THE ASSESSEE. THE LAW IS BY NOW WE LL SETTLED THAT IF THE DELAY IN NON-DISPOSAL OF THE APPEAL IS NOT ATTRIBUTABLE T O THE ASSESSEE, THEN THE TRIBUNAL HAS POWER TO EXTEND THE PERIOD OF STAY BEY OND THE TIME LIMIT LAID DOWN IN THIRD PROVISO TO SECTION 254(2A) OF THE ACT . REFERENCE MAY BE MADE TO THE DECISION OF THE HONBLE DELHI HIGH COUR T IN THE CASE OF PEPSI SP NO.214/BANG/2018 PAGE 3 OF 3 FOODS (P) LTD. V. ACIT, 376 ITR 87 (DEL) WHICH WAS FOLLOWED BY THE ITAT BANGALORE BENCH IN THE CASE OF M/S. SAP LABS (I) PVT. LTD. V. ACIT, 67 TAXMANN.COM 78. WE THEREFORE EXTEND THE ORDER OF STAY OF RECOVERY O F OUTSTANDING DEMAND FOR A PERIOD OF SIX MONTHS FROM THE DATE OF THIS ORDER, OR TILL THE DISPOSAL OF THE APPEAL, WHICHEVER IS EA RLIER. 5. IN THE RESULT, THE STAY PETITION IS ALLOWED. PRONOUNCED IN THE OPEN COURT ON THIS 3 RD DAY OF SEPTEMBER, 2018. SD/- SD/- ( A.K. GARODIA ) ( N.V. VASUDEVAN ) ACCOUNTANT MEMBER JUDICIAL MEMBER BANGALORE, DATED, THE 3 RD SEPTEMBER, 2018. / D ESAI S MURTHY / COPY TO: 1. T HE APP L IC ANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) 5. THE DR, ITAT, BANGALORE. 6. GUARD FILE BY ORDER SENIOR PRIVATE SECRETARY ITAT, BANGALORE.