2019 (2) TMI 1379 - AT - Income Tax

Stay petition - rectification order passed u/s 154 as the total demand outstanding was recomputed at inclusive of interest as charged under section 234B - HELD THAT - It is not in a position to pay any amount towards the outstanding tax demand raised, we are of the view that this is not a fit case for grant of stay on recovery of the outstanding demand of ₹ 9,29,93,360/- and accordingly dismiss the assessee s stay petition. On the request of both the parties, the hearing in this case which was fixed for 28.06.2019, stands preponed and early hearing is granted on 13.03.2019. Since the date of early hearing is pronounced in open court in the presence of both the parties, no notice of hearing the appeal in IT(TP)A No.3282/Bang/2018 for Assessment Year 2014-15 in the present case need be issued.

Summary

Issues: Stay petition for outstanding tax demand for Assessment Year 2014-15.

Analysis:
The case involves a company engaged in real estate business that filed its return of income for Assessment Year 2014-15, declaring a loss. The assessment was completed under section 143(3) r.w.s. 144C(13) of the Income Tax Act, resulting in a significant income determination due to transfer pricing adjustments. The total demand raised was substantial, including interest charges. A rectification order later recomputed the total demand outstanding at a lower amount. The assessee sought a stay on the recovery of the outstanding demand, citing financial hardship and a strong case on merits.

During the hearing, the assessee's representative argued for the stay, emphasizing the financial inability to pay any portion of the outstanding demand. Conversely, the revenue representative opposed the stay, highlighting the absence of any payment towards the tax demand and pointing out the assessee's substantial loans and advances recoverable. After considering the arguments and examining the facts and circumstances, the Tribunal concluded that the case was not suitable for granting a stay on the recovery of the outstanding demand. Consequently, the assessee's stay petition was dismissed. The Tribunal also preponed the hearing date for the appeal, granting an early hearing without the need for a separate notice. The decision was pronounced in open court, and the stay petition for Assessment Year 2014-15 was ultimately rejected.