Taxpayer granted relief from demand by ITAT Chennai, directed to pay in installments

The Appellate Tribunal ITAT Chennai partially allowed the Stay Petitions filed by the assessee, granting relief from an outstanding demand of Rs. 9,33,16,430 resulting from incorrect income computation by the Assessing Officer. Despite no clear prima facie case, the Tribunal acknowledged the assessee's hardships due to bank account attachments and directed payment of installments to lift the attachments. The assessee was required to pay Rs. 50.00 lakhs monthly starting by 31.12.2018, with bank attachments lifted upon each installment receipt. Failure to comply or seek unjustified adjournments would result in cessation of the stay.

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Issues:
Stay of outstanding demand arising from wrong methodology in computing taxable income.

Analysis:
The judgment delivered by the Appellate Tribunal ITAT Chennai pertains to Stay Petitions filed by the assessee to stay an outstanding demand of Rs. 9,33,16,430. The demand arose due to the Assessing Officer's incorrect methodology in computing taxable income under section 143(3) r.w.s.153A of the Income Tax Act, 1961. The assessee argued that there is a strong prima facie case in their favor and requested the balance demand to be stayed, along with lifting the Garnishee Order attaching bank accounts. The Department, represented by the Ld.DR, opposed the Stay Petitions.

Upon considering the submissions and evidence, the Tribunal found that the additions made in the assessments were based on disputed facts, indicating no clear prima facie case in favor of the assessee. Despite this, acknowledging the hardships faced by the assessee due to the bank account attachments, the Tribunal granted a partial stay of demand. The assessee was directed to pay installments of Rs. 50.00 lakhs by the 30th/31st of each calendar month, with the first installment due by 31.12.2018. Upon receipt of each installment, the AO would lift the bank attachments. The Tribunal specified that the stay would cease if the assessee sought adjournment from the appeal hearing without a justifiable cause.

In conclusion, the Stay Petitions were partly allowed by the Tribunal, providing relief to the assessee while also ensuring compliance with the payment schedule. The order was pronounced on 21st December 2018 in Chennai.

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