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TMI Blog1988 (8) TMI 143X X X X Extracts X X X X X X X X Extracts X X X X ..... preferred by the assessee, it was argued before the Tribunal that substantial demand has been raised by the Assessing Officer amounting to Rs. 11,63,000 and odd. The assessee was apprehensive of the coercive action to be taken by the Department for recovery, pending finalisation of the dispute. This assessee's learned counsel before us had urged that the demand raised by the Assessing Officer may be stayed, so that the assessee my not face irreparable loss. The Tribunal heard both the sides and it was noticed that the application for stay had not been made in the proper form. The Tribunal however, had disposed of the appeal by the assessee mentioned above vide order dt. 2nd Aug., 1988 by which the matter was restored to the file of the CIT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , expenditure on account of salary to employees, income-tax payments etc., could not be effected, and that, in fact, the assessee-Corporation is finding difficulties in meeting the requirements for which the application for stay was made to the CIT who had not accepted the same. It is urged, therefore that the petition for stay of the demand even after the appeal before the Tribunal has since been disposed of, may be considered and dealt with as a mercy petition, so that the assessee may not be ruined. We have heard the learned Departmental Representative also who resists the submissions made on behalf of the assessee. 5. We have gone through the records of the case and the stay petition for our perusal along with the submissions made by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appeal is a substantive right to make the exercise of these powers fully effective." Of course, the Tribunal while dealing with the application for stay pending disposal of the appeal before it, has to exercise its discretion of stay in a judicial manner and not in a mechanical or stereotype order. Reference may be made to the decision in the case of Dolton Printers Private Limited, as reported in (1985) 58 STC 137 (Mad). 6. As indicated earlier, the appeal preferred by the assessee before the Tribunal in the present case, has already been disposed of by Tribunal's order dt. 2nd Aug., 1988. In other words, there is nothing pending before the Tribunal at present stage and that in the circumstances one may say that the Tribunal have beco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncerned can correct the decision of the Tribunal in an appropriate proceedings. 7. Thus, from a short discussion made above, it could be said that the Tribunal has inherent and auxiliary powers to stay recovery proceedings if the party concerned applies before it, even during the pendency of the reference application before the High Court concerned. Again, as mentioned earlier, in the present case of the assessee, the Tribunal on the reasonings given by it has restored the matter to the file of the CIT(A) for fresh disposal after giving a finding on different points narrated by the Tribunal and after giving both the parties adequate opportunity of being heard. In other words, the appeal by the assessee was no longer pending before the Tri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ault in respect of a disputed amount. The power of the ITO under s. 220(6) to treat the assessee as not in default can be availed of and has to be exercised only during the pendency of the appeal before the first appellate authority and such powers would come to an end as soon as the appeal is disposed of by such authority. For such proposition, we may refer to the decisions as reported in the case of Emcete and Sons Private Ltd. vs. ITO (1968) 70 ITR 265 (Mad), also in the case as reported in ITO vs. M.K. Mohammed Kunhi. In exercising judicious discretion of power to stay or treat the assessee as not in default under s. 220(6), it would be useful to take into account the decision of the Hon'ble Andhra Pradesh High Court in the case of Vetc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al in the order as mentioned above. Since in the present case the stake for both the sides is very substantial and the points involved also deserve proper handling by the first appellate authority, we are confident that the Department will look into the matter judiciously. 10. Subject to the above observations, the stay petition which has been filed before us by the assessee, cannot at his stage be conceded in view of the clear position of the case that the appeal before the Tribunal is no longer pending before it as the matter has been restored to the file of the CIT(A) who is first appellate authority, for his fresh disposal. The stay petition, therefore, cannot be allowed. But the assessee is at liberty to approach the departmental aut ..... X X X X Extracts X X X X X X X X Extracts X X X X
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