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2017 (3) TMI 1855 - AT - Income TaxExtension of the stay originally granted - HELD THAT - The Hon ble Delhi High Court in Pepsi Foods Pvt. Ltd 2015 (5) TMI 655 - DELHI HIGH COURT has held that the third proviso to section 254(2A) is constitutionally invalid. The net effect of this judgment is that if the appeal could not be disposed of by the Tribunal for no fault of the assessee, then the power vests with the Tribunal to extend the stay beyond the aggregate period of 365 days. On merits, it is indisputably found that the terms of stay originally granted have been duly complied with. The appeal could not be finally heard for one reason or the other, but, for no fault of the assessee. Considering the entirety of the facts and circumstances of the instant case, we are inclined to grant extension of stay for a further period of six months from today or till the disposal of the appeal, whichever is earlier. Stay application allowed.
Issues:
1. Extension of stay application for assessment year 2011-12. Analysis: The judgment pertains to a stay application seeking an extension originally granted by the Tribunal for the assessment year 2011-12. The Assessee, represented by Shri Rohit Garg, Advocate, requested the extension, stating that the conditions of the original stay were met, and the delay in appeal disposal was not due to their fault. On the other hand, the Revenue, represented by Shri A.K. Sharma, Sr. DR, opposed the extension. The Tribunal considered the arguments and referred to a precedent set by the Hon’ble Delhi High Court in Pepsi Foods Pvt. Ltd vs. ACIT, which declared the third proviso to section 254(2A) as constitutionally invalid. This ruling allowed the Tribunal to extend the stay beyond 365 days if the appeal delay was not the assessee's fault. On the merits, the Tribunal found that the terms of the original stay were complied with by the Assessee. The appeal delay was not attributed to the Assessee's fault. Considering the circumstances, the Tribunal decided to grant an extension of stay for a further six months from the date of the judgment or until the appeal's disposal, whichever is earlier. Ultimately, the Tribunal allowed the stay application, and the order was pronounced in the open court on 03.03.2017.
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