WILLIAM SERTO,MANIPUR, IMPHAL V. INCOME TAX OFFICER W-3-IMPHAL, IMPHAL

SA 10/GTY/2024

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William Serto, a tribal resident of Manipur, filed a stay petition against a demand of Rs. 2,76,27,078, which included tax and interest, asserting that his income from LPG gas cylinder distribution was exempt under section 10(26) of the Income Tax Act. The Income Tax Officer (ITO), Ward-3, Imphal, had assessed his income under section 144 and issued a notice under section 148 for the assessment year 2017-18. Serto contended that he was unaware of the proceedings and did not receive notices due to his lack of familiarity with e-proceedings and the faceless assessment system. His appeal to the Commissioner of Income Tax (Appeals) was rejected for non-payment of advance tax, which he argued was not applicable to him. The tribunal considered the merits of his case and the provisions of section 254(2A) of the Income Tax Act, deciding to grant a stay on the condition of partial payment.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 46723 (ITAT-GUWAHATI)
• Appeal Type: Stay Application
• Pronouncement Date: 05-02-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2017-2018
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Application of stay
• Section: 148; 144

Judgement Text

"आयकर अपीलीय अधिकरण गुवाहाटी पीठ, कोलकाता में IN THE INCOME TAX APPELLATE TRIBUNAL GUWAHATI BENCH AT KOLKATA [वर्ुुअल कोटु] [Virtual Court] श्री मनमोहन दास, न्याधयक सदस्य एवं श्री राक ेश धमश्रा, लेखा सदस्य क े समक्ष Before SHRI MANOMOHAN DAS, JUDICIAL MEMBER & SHRI RAKESH MISHRA, ACCOUNTANT MEMBER S.A. No.: 10/GTY/2024 In I.T.A. No.: 230/GTY/2024 Assessment Year: 2017-18 William Serto Vs. ITO, Ward-3, Imphal (Appellant) (Respondent) PAN: DMEPS6590G Appearances: Assessee represented by : Babulal Jain, FCA. Department represented by : Kausik Ray, JCIT Date of concluding the hearing : January 31st, 2025 Date of pronouncing the order : February 5th, 2025 ORDER PER RAKESH MISHRA, ACCOUNTANT MEMBER: The assessee has filed the present Stay Petition SA No. 10/GTY/2024 in ITA No. 230/GTY/2024 dated 13.11.2024 requesting for stay of demand of Rs. 2,76,27,078/- which comprises of tax of Rs. 1,27,90,330/- and interest of Rs. 1,48,36,748/-. Along with the Page | 2 S.A. No.: 10/GTY/2024 In I.T.A. No.: 230/GTY/2024 Assessment Year: 2017-18 William Serto. petition, the assessee has also filed an affidavit which is reproduced as under: “I, William Serto S/o. Late Khopes Serto resident of RIMS Doctor's Colony- Type-IV, No.11, Lamphelpat- Lamphel- Imphal West-795001 Pan No.:- DMEPS6590G. I am resident Tribal of Manipur and I have earned income from distribution of LPG Gas Cylinder of I.O.C. in Mantripukhuri area of Imphal (Manipur) as such I have earned income in notified area. Therefore as per provision of 10(26) my income is exempt and not included in my total income. My Jurisdiction Assessing Officer I.T.O. Ward-3-Imphal started proceeding u/s. 147 and issued notice u/s. 148 for the Asst. Year: 2017-2018. I am tribal so I am not aware about e-proceeding and I was in belief that as my income is exempt so I do not require to file return of income and net my Pan was registered on e-portal of Income Tax, therefore I have not received all notices issued by A.O. and Faceless Authority therefore I could not file proper reply to A.O. and Income Tax Faceless Authority completed assessment u/s. 144 and computed income Rs.1,65,57,061/- and determine tax of Rs.2,76,27,078/-. I have filed appeal before Commissioner of Income Tax (Appeals) against order passed by Income Tax Faceless Assessment Unit against my appeal National Faceless Appeal Centre, New Delhi passed order reject my appeal on ground that I have not paid an amount equal to the amount of advance tax. Whereas my income were exempt u/s. 10(26). Therefore, I am not liable to pay Income Tax. I have filed appeal before Income Tax Appellate Tribunal, Guwahati Bench on 04/11/2024 online and appeal no.238/GTY 2024 which is pending before you. I feel that I have fair chance of succeeding in appeal before the Tribunal. I have no liquidity or bank balance to make the payment of tax in dispute. I say that whatever is stated here in above and in stay petition is true to the best of my knowledge and belief the same to be true.” 2. We have heard the rival contentions and examined the facts of the case. It is stated that the assessment order was made u/s 144 of the Act and the appeal was dismissed by the Ld. CIT(A) on account of non- Page | 3 S.A. No.: 10/GTY/2024 In I.T.A. No.: 230/GTY/2024 Assessment Year: 2017-18 William Serto. payment of advance tax but the assessee is not liable to pay advance tax. In this respect it is imperative to examine the petition under sub- section (2A) of section 254 of the Income Tax Act, 1961 (in short the 'Act') read with the first proviso thereof which is as under: “In every appeal, the Appellate Tribunal, where it is possible, may hear and decide such appeal within a period of four years from the end of the financial year in which such appeal is filed under sub-section (1) or sub-section (2) of section 253: Provided that the Appellate Tribunal may, after considering the merits of the application made by the assessee, pass an order of stay in any proceedings relating to an appeal filed under sub-section (1) of section 253, for a period not exceeding one hundred and eighty days from the date of such order subject to the condition that the assessee deposits not less than twenty per cent 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 thereof and the Appellate Tribunal shall dispose of the appeal within the said period of stay specified in that order:” 3. The relevant provisions were brought to the notice of the Ld. AR and it was enquired whether the assessee was willing to pay 20% of the outstanding demand for which he expressed his inability. The assessee was advised to file an application for early hearing of the case and the stay petition is allowed subject to the following conditions: (i) The assessee shall pay 20% of the outstanding demand of Rs. 2,76,27,078/- (i.e. Rs. 55,25,416/-) within a period of one month. (ii) Subject to the payment of the demand as at (i), the rest of the demand shall be stayed for a period of 180 days or till the disposal of the appeal, whichever is earlier. (iii) No adjournment shall be sought by the assessee in the appeal before the Tribunal unless it is absolutely necessary on account of any exigency or unavoidable circumstances. Page | 4 S.A. No.: 10/GTY/2024 In I.T.A. No.: 230/GTY/2024 Assessment Year: 2017-18 William Serto. 4. In the result, the Stay Application filed by the assessee is allowed as above. Order pronounced on 5th February, 2025 under Rule 34(4) of the Income Tax (Appellate Tribunal) Rules, 1963. Sd/- Sd/- [Manomohan Das] [Rakesh Mishra] Judicial Member Accountant Member Dated: 05.02.2025 Bidhan (P.S.) Page | 5 S.A. No.: 10/GTY/2024 In I.T.A. No.: 230/GTY/2024 Assessment Year: 2017-18 William Serto. Copy of the order forwarded to: 1. William Serto, RIMS Doctors Colony Type IV No 11 Lamphelpat Lamphel, Manipur, 795001. 2. ITO, Ward-3, Imphal. 3. CIT(A)- 4. CIT- 5. CIT(DR), Guwahati Benches, Guwahati. 6. Guard File. //True copy // By order Assistant Registrar ITAT, Kolkata Benches Kolkata "