2018 (3) TMI 1703 - AT - Income Tax

Stay of the balance demand - Penalty demand raised by AO u/s 271AAB which was later on revised u/s 154 - Held that - We find that the assessee has already deposited 1/3rd of the total outstanding demand of ₹ 30,00,000/- and the matter is already listed for hearing on 10th April 2018. The balance demand is stayed for 3 months or till disposal of the appeal whichever is earlier. As further directed that the assessee shall not seek any adjournment in the matter without showing any reasonable cause to the satisfaction of the Bench, otherwise the stay would stand vacated.

Summary

Issues Involved: Stay application against penalty demand under section 271AAB of the Act

Analysis:
1. Issue of Penalty Demand and Stay Application: The judgment deals with a stay application filed by the assessee against a penalty demand raised by the Assessing Officer under section 271AAB of the Act, which was later revised under section 154 of the Act. The total penalty demand amounted to ?30,00,000.

2. Contentions of the Assessee: The Learned Authorized Representative (AR) representing the assessee submitted that the assessee had already paid ?10,00,000 of the total penalty demand and requested the balance demand to be stayed until the appeal's disposal. The AR argued that the penalty had been increased from 10% to 30% due to a slight delay in filing the income tax return by 21 days. The AR further contended that the merits of the case favored the assessee, expressing hope for a favorable decision. Financial hardship was highlighted, stating the lack of liquid funds to pay the balance demand.

3. Revenue's Opposition: The Learned Departmental Representative (DR) opposed the stay petition, suggesting that the assessee should deposit at least 50% of the outstanding demand instead of seeking a stay for the balance amount.

4. Decision and Directions: After hearing both parties and reviewing the records, the Tribunal noted that the assessee had already paid 1/3rd of the total outstanding demand. The Tribunal decided to stay the balance demand for 3 months or until the appeal's disposal, whichever is earlier. Additionally, the assessee was directed not to seek adjournments without a valid reason, failing which the stay would be vacated.

5. Final Disposition: The Tribunal disposed of the stay application with the aforementioned directions, emphasizing that the order was pronounced in open court on 09/03/2018.

This judgment primarily addresses the stay application against a penalty demand under section 271AAB of the Act, outlining the arguments presented by both parties and the Tribunal's decision to partially stay the balance demand pending the appeal's outcome.