2015 (8) TMI 867 - AT - Income Tax

Revision u/s 263 - deduction under section 80-IA - Held that - The argument of the assessee that a perusal of the original order passed under section 143(3) of the Act on December 30, 2011, prima, facie demonstrates that the Assessing Officer had granted deduction under section 80-IA of the Act, after obtaining certain details and documents and hence the order passed under section 263 is against law has some force, which has to be examined at the final hearing. We make it clear that this is only a prima facie observation and shall not have any precedence value. Hence we are of the view that the assessee has demonstrated that, it has a prima facie case. At the same time we also notice that the time limit for completing the assessment under section 143(3) in pursuance of the order under section 263 dated March 30, 2014, will expire on March 31, 2015. The time left is a little over two months from today. Thus, it will not be correct to grant stay of assessment proceedings, which are a consequence to the impugned section 263 order, as any such order, may result in the order to be passed under section 143(3) read with section 263, becoming time barred. Hence we refrain from staying the said assessment proceedings. Be it as it may, as we are convinced that the balance of convenience is in favour of the assessee, we stay the operation of the order to be passed under section 143(3) read with section 263 of the Act for the assessment year 2009-10 for a period of 60 days, from the date of passing of such an order under section 143(3) read with section 263 or disposal of the appeal. Stay application is partly allowed.

Issues Involved:
1. Stay of proceedings arising from an order under section 263 of the Income-tax Act, 1961 for the assessment year 2009-10.
2. Stay of collection of taxes for the assessment year 2011-12.
3. Attachment of bank accounts for the assessment year 2011-12.

Issue-wise Detailed Analysis:

1. Stay of proceedings arising from an order under section 263 for the assessment year 2009-10:
The assessee sought a stay on the proceedings arising from an order passed under section 263 of the Income-tax Act, 1961 by the Commissioner of Income-tax, Noida, for the assessment year 2009-10. The original order under section 143(3) was passed on December 30, 2011, and was later revised by invoking section 263, which the assessee claimed was illegal. The Tribunal acknowledged the prima facie case, noting that the Assessing Officer had granted deduction under section 80-IA after obtaining necessary details and documents. However, the Tribunal refrained from staying the assessment proceedings due to the impending time limit for completing the assessment under section 143(3) read with section 263, which would expire on March 31, 2015. Instead, the Tribunal stayed the operation of the order to be passed under section 143(3) read with section 263 for a period of 60 days from the date of passing such an order or until the disposal of the appeal, whichever is earlier.

2. Stay of collection of taxes for the assessment year 2011-12:
The assessee also sought a stay on the collection of taxes for the assessment year 2011-12, arguing that the Assessing Officer had raised huge demands under the influence and direction of the Commissioner of Income-tax, Noida. The assessee's appeal against this order was pending before the Commissioner of Income-tax (Appeals). The Tribunal clarified that it did not have jurisdiction over the assessment year 2011-12 as the appeal for that year was not before it. The Tribunal cited precedents, including the case of Maharashtra Housing and Area Development Authority, to emphasize that each assessment year and proceeding is separate and independent. Consequently, the Tribunal rejected the prayer to stay the entire proceedings for the assessment year 2011-12.

3. Attachment of bank accounts for the assessment year 2011-12:
The assessee contended that the Assessing Officer had attached all its bank accounts without notice, resulting in damage to its business. The Departmental representative argued that the assessee had been declared in default for not complying with the conditions of a stay notice and that the attachment of bank accounts was a lawful measure to recover government dues. The Tribunal noted that the power to grant stay should be exercised in accordance with legal propositions and that the assessee had not demonstrated a direct link between the assessment order for 2011-12 and the appeal for 2009-10. Thus, the Tribunal did not grant any stay related to the attachment of bank accounts for the assessment year 2011-12.

Conclusion:
The stay application was partly allowed. The Tribunal granted a limited stay on the operation of the order under section 143(3) read with section 263 for the assessment year 2009-10, while rejecting the stay requests related to the assessment year 2011-12 and the attachment of bank accounts. The case was directed to be posted on an out-of-turn basis on February 9, 2015, with instructions for the assessee to avoid seeking adjournments except under exceptional and bona fide circumstances.

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