1990 (3) TMI 141 - AT - Income Tax

Summary

Issues:
1. Stay petitions preferred by the assessee for assessment years 1984-85 and 1985-86.
2. Discrepancy in tax amounts due for the mentioned assessment years.
3. Interpretation of an agreement between the assessee and the Revenue regarding payment of tax.
4. Legal considerations for granting a stay of proclamation of sale.

Analysis:

1. The stay petitions were filed by the assessee for the assessment years 1984-85 and 1985-86. Initially, interim stay of proclamation of sale was granted by the tribunal. The Revenue raised objections regarding the nature of the petitions, arguing that no appeals were pending before the Tribunal, only cross-objections. The Department contended that the assessee's delay in filing appeals indicated a lack of conviction in the claims made in the cross-objections. However, the tribunal found that the contentions raised in cross-objections should be considered akin to those in an appeal, as per statutory provisions.

2. The dispute revolved around the tax amounts due for the assessment years 1984-85 and 1985-86. The Revenue claimed outstanding amounts of Rs. 11,92,000 and Rs. 10,19,000 respectively. The assessee contested these figures, stating that if relief claimed in cross-objections was allowed, the tax dues would be significantly lower. Detailed computations were presented by both parties, highlighting discrepancies in the calculation of net increase in assets and unexplained assets for the respective years.

3. An agreement between the assessee and the Revenue regarding tax payment was a focal point of contention. The agreement, dated 5-9-1989, outlined a scheme for payment, including a lump sum amount and monthly installments. The Revenue argued that the assessee failed to adhere to the agreement, justifying the issuance of a proclamation for sale. However, the tribunal noted that the agreement was based on the premise that the demand was admitted to be payable, which was disputed by the assessee through filed cross-objections. The tribunal emphasized the statutory right of the assessee to contest the tax demand through legal avenues.

4. The tribunal deliberated on the legal considerations for granting a stay of proclamation of sale. Citing relevant case law, the tribunal emphasized factors such as irreparable injury, public interest, and balance of convenience. It was noted that the proclamation of sale, if enforced, would cause irreparable harm to the assessee. The tribunal considered the merits of the contentions raised in the cross-objections and concluded that the issues warranted further examination. Consequently, the tribunal granted an absolute stay of the proclamation of sale until the appeal was disposed of, subject to a specified payment deadline.

This comprehensive analysis addresses the key issues and legal considerations outlined in the judgment, providing a detailed overview of the tribunal's decision-making process and reasoning.