2021 (9) TMI 1049 - HC - Income Tax

Stay of passing of final/draft assessment order pursuant to the AAR Ruling 2018 (6) TMI 618 - AUTHORITY FOR ADVANCE RULINGS, NEW DELHI - HELD THAT - This Court is of the view that till the present proceedings are disposed of it would not be appropriate to pass assessment orders pursuant to the impugned AAR Ruling dated 06th June, 2018 especially when the tax is being fully deposited by the petitioner. Following the principle of consistency, this Court clarifies that the stay order dated 12th October, 2018 as made absolute on 5th August, 2019 applies to all assessments of the petitioner-applicant which will be consequent to the AAR Ruling supra till the disposal of the present writ petition. It is clarified that by virtue of the present interim order, the respondents shall be entitled to the benefit of Explanation 1(ii) of Section 153 of the Income Tax Act.

Summary

Issues: Stay of final assessment order pursuant to AAR Ruling for Assessment Years 2018-19, 2019-20, and 2020-21 during the pendency of the writ petition.

In the present case, the petitioner sought a stay on the passing of final/draft assessment orders for Assessment Years 2018-19, 2019-20, and 2020-21 following an AAR Ruling. Despite interim orders staying the assessment orders, the Assessing Officer insisted on passing them by a specific date. The court noted the previous stay orders and observed that passing assessment orders during the ongoing proceedings would not be appropriate, especially when the petitioner had fully deposited the tax amount. The court emphasized consistency and clarified that the stay order applied to all assessments related to the AAR Ruling until the disposal of the writ petition. The respondents were granted the benefit of Explanation 1(ii) of Section 153 of the Income Tax Act. Consequently, the court disposed of the application, directing the order to be uploaded on the website and forwarded to the counsel via email.