2019 (10) TMI 551 - HC - Income Tax

Rejection of stay application - dis-allowance of the commission paid - HELD THAT - The present matter deserves to be remitted back to the learned Tribunal for passing a reasoned and a speaking order on the stay application filed by the Assessee. For arriving at the conclusion whether the Assessee has a prima facie case or not, at least, the case facts should have been discussed by the Tribunal in some detail. Whether such dis-allowance has been made for the earlier assessment years or not was a relevant fact, which appears to have escaped the notice of the Tribunal, though raised in the stay application filed before the learned Tribunal. Matter restored before the ITAT.

Summary

Issues:
Interlocutory order rejecting stay application for Assessment Year 2009-10.

Analysis:
The appeal was filed by the assessee against an interlocutory order passed by the Income-Tax Appellate Tribunal rejecting the stay application for the Assessment Year 2009-10. The appellant argued that despite success in previous years on a similar issue, the Tribunal did not consider this fact and concluded that the assessee did not have a prima facie case. The appellant contended that the Tribunal's observations were self-contradictory, and interim relief should have been granted based on the facts presented. The appellant had already paid a significant amount against the demand for the said assessment year. The respondent department supported the impugned order.

The High Court noted the contradictory observations in the Tribunal's order and the lack of detailed discussion on case facts. The Court emphasized that tribunals must consider three key aspects in stay applications: the existence of a prima facie case, irreparable injury, and the balance of convenience. It was highlighted that the Tribunal's order did not meet these requirements as it did not provide reasoning on the mentioned aspects. The Court stressed that tribunals must give findings and reasons, even if tentative, regarding these aspects when dealing with stay applications.

Given the deficiencies in the Tribunal's order, the High Court allowed the appeal, set aside the impugned order, and remitted the matter back to the Tribunal for a reasoned and speaking order on the stay application. The Tribunal was directed to hear the parties again and pass a fresh order expeditiously, preferably within three months. The parties were instructed to appear before the Tribunal on a specified date without further notice. No costs were awarded, and the connected miscellaneous petition was closed.