2014 (2) TMI 25 - HC - Income Tax

Rejection of stay application - Held that - the Tribunal having once held that the petitioner has a prima facie case while disposing of its stay petition, has taken opposite view when it later dismissed the stay petition - A certain amount of consistency is expected in the working of a statutory tribunal - When the Tribunal had earlier observed that the petitioner had an arguable case, this court deems it appropriate to dispose of the writ petition directing the Tribunal to finally hear and decide the appeal - Decided in favour of petitioner.

Summary

Issues:
Challenge to order by Tax Recovery Officer based on alleged undisclosed income; Delay in hearing appeal before Income-tax Appellate Tribunal; Dismissal of stay application by Tribunal; Inconsistency in Tribunal's decisions; Direction to Tribunal for final hearing and decision of appeal.

Analysis:
The writ petition challenged the order of the Tax Recovery Officer dated August 19, 2003, concerning alleged undisclosed income following a survey at the petitioner's business premises. The Commissioner of Income-tax (Appeals) partially allowed relief, leading to an appeal before the Income-tax Appellate Tribunal. Despite the Tribunal's direction for an expedited hearing in June 2013, the matter was rescheduled for August 19, 2013, where the Tribunal dismissed the stay application and adjournment requests, prompting the writ petition.

The petitioner argued that the Tribunal's initial observation of an arguable case during the stay application contradicted its later decision to dismiss the stay petition, highlighting inconsistency and the need for a final hearing. The respondents contended that the Tribunal had the discretion to reassess the case, considering the excess stock found during the survey, justifying the refusal of interim relief pending the appeal's final determination.

The High Court noted the Tribunal's shift in stance and emphasized the importance of consistency in a statutory tribunal's functioning. It directed the Tribunal to hear and decide the appeal, setting a deadline for final resolution by December 20, 2013, to ensure timely adjudication. The court clarified that its directions did not impact the case's merits, providing a clear directive for the Tribunal to address the appeal promptly.

In conclusion, the writ petition was disposed of, instructing the Tribunal to proceed with the final hearing and decision of the appeal by a specified date, aiming to resolve the matter without further delays.