2016 (3) TMI 861 - AT - Income Tax

Stay petion - Delay in disposal of the appeal - Held that - On due consideration of the facts and circumstances, we are of the view that the assessee was always willing and ready to get its appeal disposed off on an early date. The issues involved in the appeal are dependent and interlinked with A.Ys. 2006-07, 2007-08 & 2008-09. Hearings in those assessment years have already been completed. The order is awaited. Considering these facts, we allow the application of the assessee and stay the recovery of outstanding demand for a period of 180 days from today or till the disposal of the appeal, whichever event occurs first. The assessee shall not seek adjournment unless unavoidable circumstance warrants so. In the result, Stay Application filed by the assessee is allowed.

Summary

Issues:
Stay of recovery of outstanding demand amounting to Rs. 52,95,70,660.

Analysis:
The Stay Application was filed by the assessee seeking to halt the recovery of the outstanding demand. The Tribunal had previously allowed a Stay Application for a period of 180 days. The dispute arose from the assessment order passed by the AO under section 143(3) r.w.s. 144C r.w.s. 92CA(3) of the Income Tax Act, which computed the income of the assessee to be Rs. 105,23,58,650. The major addition to the income was based on the recommendation of the Transfer Pricing Officer regarding international transactions with associated enterprises. The assessee contended that if GMDAT was selected as the tested party, the demand would be reduced, citing previous Tribunal decisions in favor of such methodology.

The assessee argued that following the Tribunal's decisions in the Asstt. Years 2006-07 and 2007-08 would eliminate the demand due to significant brought forward losses for adjustment. On the other hand, the AO and DR opposed the assessee's claims, emphasizing the AO's considerations in rejecting the previous stay application and the lack of complete financial data regarding GMDAT. The Tribunal noted the debatable nature of the issue and the favorable precedent from previous years, leading to a decision to stay the outstanding demand subject to certain conditions.

The Tribunal directed the assessee to pay Rs. 1,00,00,000 on or before a specified date, submit necessary documents before the appeal hearing, and avoid seeking adjournments without valid reasons. The appeal was listed for an expedited hearing along with similar cases involving identical issues. The Tribunal found merit in the assessee's case and granted the stay of recovery for 180 days or until the appeal's disposal, whichever occurred first.

In a subsequent application, the assessee sought an extension of the stay, highlighting the history of hearings and adjournments due to the Tribunal's scheduling issues. The Tribunal acknowledged the assessee's readiness for early disposal and the interlinked nature of issues across multiple assessment years. Consequently, the Tribunal allowed the extension of the stay for 180 days or until the appeal's finalization, with a directive for the assessee not to seek adjournments without valid reasons.

In conclusion, the Tribunal granted the Stay Application, considering the complexities of the case, the previous Tribunal decisions, and the assessee's compliance with procedural requirements and readiness for early disposal of the appeal.