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TMI Blog2023 (3) TMI 188X X X X Extracts X X X X X X X X Extracts X X X X ..... d, in letter and in spirit, and, on the other hand, it has to be equally ensured that, within this framework, substantial justice is to be rendered to the assessee and the rights of the assessee even to seek the legal remedies against any inappropriate use of power by the field authorities are zealously guarded. What constitutes reasonable security may vary from case to case. That is where a judicious and pragmatic approach by the field authorities is of utmost importance. Still, where their decisions, on this aspect, are less than appropriate, the Tribunal can surely judicially examine the same, or even decide, on its own, as to what is the nature of security to be offered by the assessee. In the present case, for the reasons we will set out in a short while, there is no need for us, as of now, to take a call on the nature of security to be offered by the assessee, even as the ususal precautions to safeguard legitimate rights of the assessee are being taken anyway. Learned counsel hastens to add, at the fag end of the proceedings, that since almost all the issues are covered by the binding judicial precedents in favour of the assessee, a conditional stay may be granted by direc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de by the taxpayer. 2. When this stay application was brought up for hearing, it was noticed that the taxpayer had not paid any part of the disputed tax demands impugned in the appeal before us. In response to our question, learned counsel submits that, in view of the peculiar facts of this case and given the balance of convenience, the assessee does not intend to make payment of any part of the impugned demands even now, as it is not, on the facts and in the circumstances of the case, required either. Learned counsel submits that his prayer is for a blanket stay and that he is not in a position to, nor does he think he is required to, make payment of any part of the disputed tax demands. It is submitted that on the majority of the issues in the appeal, the issues are covered, in favour of the assessee, mostly by the binding judicial precedents in the assessee‟s cases or the cases of the assessee‟s sister concerns. It is submitted that these judicial precedents show that the assessee has a very strong prima facie case in favour of the assessee, and the balance of convenience is in favour of the collection/recovery of the disputed demands being stayed till the disposa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nts, as also the prima facie merits of the case. Learned counsel then painstakingly takes us through the material on record to show the prima facie merits of his case, the balance of convenience being in favour of the disputed demands being kept in abeyance till the appeal before us is disposed of, and to justify that, on merits, facts and circumstances of the case warrant and justify the blanket stay, as prayed for. 4. Learned Departmental Representative, on the other hand, vehemently opposes the stay petition, pointing out that the matter has been examined by the Assessing Officer as also the Dispute Resolution Panel, as also the fact that the assessee has not paid any part of the disputed demand, and submits that given this position, and given the inherent limitations of the powers of the Tribunal, we should decline to grant the stay in this case unless the taxpayer actually pays at least 20% of the outstanding disputed demands. It is submitted that once there is an amendment in the statute itself, and the powers of the Tribunal are restricted to granting a stay only upon satisfaction of a certain condition, it cannot be open to us to grant a blanket stay. It is also submitte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he special nature of taxation and revenue laws. It will only be when a strong prima facie case is made out that the Tribunal will consider whether to stay the recovery proceedings and on what conditions, and the stay will be granted in most deserving and appropriate cases where the Tribunal is satisfied that the entire purpose of the appeal will be frustrated or rendered nugatory by allowing the recovery proceedings to continue during the pendency of the appeal . Be that as it may, that was a situation, as evident from these observations, when the statute did not vest any express powers in the Tribunal for grant of the stay on the collection/recovery of disputed demands during the pendency of the litigation before the Tribunal. As the legal position stands today, the first proviso to Section 254(2A), categorically inter alia provides that . the Appellate Tribunal may, after considering the merits of the application made by the assessee, pass an order of stay in any proceedings relating to an appeal filed under sub-section (1) of section 253, for a period not exceeding one hundred and eighty days from the date of such order subject to the condition that the assessee deposits not l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... termed as ut res magis valeat quam pereat, i.e., to make the statute effective rather than making it redundant. As held by Hon‟ble Supreme Court, in the case of S. Teja Singh (supra) a construction which results in rendering a provision redundant must be avoided. For this reason alone, the interpretation canvassed by the revenue is to be rejected . The view so taken has been affirmed by the Hon‟ble jurisdictional High Court, in the judgment reported as CIT Vs Papillon Investments Pvt Ltd [(2012) 20 taxmann.com 201 (Bom)]. What essentially follows from these discussions is that the powers of this Tribunal, under section 254(1), to grant a stay cannot be so interpreted as to make the first proviso to Section 254(2A) redundant. 7. While elaborating upon the need for harmonious construction of the statutory provisions, the oft-quoted treatise Justice GP Singh on the Principles of Statutory Interpretation (14th paperback edition @ page 159)‟, has these words of advice: ..It has already been seen that a statute must be read as a whole and one provision of the Act should be construed with reference to other provisions in the same Act so as to make a consistent e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to us within the framework of the law as it exists- whether made by the lawmakers or as interpreted by the Hon‟ble judges above. When the statute does not give us the powers to grant a blanket stay, nor the Hon‟ble Courts above hold so, it cannot be open to us to hold that we can grant a blanket stay- clearly contrary to the scheme of the law as visualised under the first proviso to Section 254(2A). We are, thus, not inclined to hold that we have the powers to grant any stay on collection/recovery of demands impugned in the appeal before us, in violation of the first proviso to Section 254(2A). The decisions that the learned counsel for the assessee has sighted before us in the context of the grant of stay under section 220(2), i.e. during the pendency of the first appeal, do not really apply in the present context, as Hon‟ble Supreme Court itself and in Mohd Kunhi‟s case (supra), has observed that It may also be that, as a matter of practice prevailing in the department, the Commissioner or the Inspecting Assistant Commissioner, in exercise of administrative powers, can give the necessary relief of staying recovery to the assessee but that can hardly be pu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and in spirit, and, on the other hand, it has to be equally ensured that, within this framework, substantial justice is to be rendered to the assessee and the rights of the assessee even to seek the legal remedies against any inappropriate use of power by the field authorities are zealously guarded. What constitutes reasonable security may vary from case to case. That is where a judicious and pragmatic approach by the field authorities is of utmost importance. Still, where their decisions, on this aspect, are less than appropriate, the Tribunal can surely judicially examine the same, or even decide, on its own, as to what is the nature of security to be offered by the assessee. In the present case, for the reasons we will set out in a short while, there is no need for us, as of now, to take a call on the nature of security to be offered by the assessee, even as the ususal precautions to safeguard legitimate rights of the assessee are being taken anyway. 9. Learned counsel hastens to add, at the fag end of the proceedings, that since almost all the issues are covered by the binding judicial precedents in favour of the assessee, a conditional stay may be granted by directing the A ..... X X X X Extracts X X X X X X X X Extracts X X X X
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